Chavdar Vasilev is a journalist covering the casino and sports betting market sectors for CasinoBeats. He joined CasinoBeats in May 2025 and reports on industry-shaping stories across the US and beyond, including legislative debates, market...
Read Full BioSleeper has become the latest daily fantasy sports (DFS) operator to be hit with a class action lawsuit in California. On October 2, a state resident filed a proposed class action, Holyk v. Blitz Studios, Inc., in the US District Court for the Southern District of California, accusing the defendant of “platforming illegal gambling” in violation of state law.
The lawsuit adds to a growing list of DFS operators that have been sued in California since July, when the state’s Attorney General, Rob Bonta, issued a legal opinion declaring DFS unlawful.
DFS Class Actions: A Growing List
California’s now home to at least eight class actions against leading DFS platforms, all alleging that they are conducting illegal gambling in the state.
Filed in July 2025
- Head v. Underdog Sports, LLC (Underdog Fantasy) — Filed July 1, 2025, in the Northern District of California before Judge Charles R. Breyer. The proposed class challenges Underdog’s DFS contests under California gambling law.
- Four lawsuits by the Almeida Law Group – On July 3, the Almeida Law Group stated in a press release that a coalition of law firms has filed four class actions against FanDuel, DraftKings, PrizePicks, and Underdog Fantasy.
- Beltran v. FanDuel — Filed in early July 2025 in the Northern District of California by plaintiff Martin Beltran, alleging FanDuel’s DFS constitutes illegal gambling. The case was voluntarily dismissed without prejudice on September 8, 2025, leaving the possibility of refiling open.
Filed in August 2025
- Koning v. Underdog Sports, LLC (Underdog Fantasy) – Filed on August 26, in the Northern District of California, alleging that Underdog did not disclose the “true nature” of its daily fantasy sports games, which were actually “illegal sports bets.”
- Huynh v. Boom Shakalaka, Inc. (Boom Fantasy) — Filed August 28, 2025, in the Central District of California, alleging the operator misrepresented the legality of its contests. Plaintiffs seek restitution for losses.
Outside California, Boom Fantasy faces a similar suit in Illinois, filed on October 1.
Bonta’s Opinion & Enforcement Pledge
In his legal opinion, Bonta declared that all DFS, including the controversial, pick ‘em-style and peer-to-peer, is “illegal gambling” under California law. He emphasized that DFS involves wagering on “the performance of athletes in future sporting events.” That makes the contests no different than sports betting, which remains illegal in California.
Although it does not change the law, the opinion has been cited by plaintiffs to bolster their claims. Despite the lawsuits and Bonta’s stance, no DFS operator has left the state, as it’s the largest market in the US.
Most have switched to the peer-to-peer DFS format, which operators claim complies with California law by emphasizing competition between users rather than the house.
Still, Bonta has warned that enforcement would follow, saying that “laws are meant to be enforced.” It has been over two months since then, with no public enforcement actions taken.
Sleeper’s Parallel Fight with the CFTC
The California class action is not Sleeper’s only legal challenge. The company is also suing the US Commodity Futures Trading Commission (CFTC), claiming the agency is illegally blocking its path to becoming a futures commission merchant (FCM).
Sleeper also claims that “similarly situated companies” have obtained approvals. Those include rivals PrizePicks and Underdog, which have already entered or are preparing to enter the prediction market segment.
These developments suggest that DFS operators are exploring new verticals as their traditional model comes under fire. In Sleeper’s case, defending itself in California while suing a federal regulator highlights how gaming startups are testing every angle to stay relevant in a tightening regulatory landscape.
Sweepstakes Casinos: Another Target in CA
DFS isn’t the only unregulated gambling format under threat in California. Last month, the state’s Legislature passed Assembly Bill 831 (AB 831), which bans online sweepstakes casinos using dual-currency models. The bill is now on Governor Gavin Newsom’s desk, awaiting signature.
If enacted, AB 831 will take effect January 1, 2026. It imposes fines of up to $25,000 and potential jail time for each violation.
Tribal gaming associations have strongly backed the bill. They argue that sweepstakes casinos threaten the exclusivity of tribal gaming and expose consumers to unregulated risk. Meanwhile, proponents of sweepstakes casinos say that the measure would destroy a billion-dollar digital sector and criminalize legitimate business relationships.
California’s Message: DFS & Sweeps Not Welcome
In the last few months, California has seen at least eight proposed class actions against major DFS operators, an attorney general’s opinion branding DFS illegal, and a pending legislative ban on sweepstakes casinos.
Together, these moves paint California as a key battleground for unregulated gambling formats. Platforms like Sleeper, Underdog, and PrizePicks now face a crossroad: defend their DFS contests in court, rework their products into new formats, or pivot entirely into emerging segments like prediction markets.
