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 BioFanDuel has avoided a courtroom fight in California—for now. The plaintiff in a class action lawsuit, filed in July, which accused the company of operating illegal daily fantasy sports (DFS) contests in the state, has had the lawsuit voluntarily dismissed without prejudice, even as California Attorney General Rob Bonta declared DFS unlawful gambling under state law.
In the case filed in the US District Court for the Northern District of California, plaintiff Martin Beltran alleged that FanDuel’s DFS functions identically to sports betting, which is banned in California.
The complaint sought monetary restitution for players and an injunction halting FanDuel’s operations in the state.
‘Unlawful Gambling’ Allegations
In its introduction, the July 2 complaint claims:
“Since at least 2015, FanDuel, the self-described ‘#1 Sportsbook and the premier mobile sports betting operator in the U.S.,’ has been operating mobile gambling applications and websites within California … representing to customers and the public that its daily fantasy sports contests, often branded as ‘FanDuel Fantasy,’ are legal forms of gambling in California. They are not.”
It framed FanDuel’s DFS contests as indistinguishable from sports betting:
“Users place bets with FanDuel regarding the expected future actual performance of athletes … FanDuel collects the sums bet and wagered by users and pools the bets and wagers together into a ‘prize pool’ … FanDuel pays out the winners from the prize pool. And finally, FanDuel determines the share of the prize pool of bets that it keeps.”
Beltran claimed that he lost over $200 on FanDuel DFS. The complaint also states that FanDuel’s marketing misled him into believing they were legal:
“FanDuel intentionally and strategically leads—in fact, misleads—consumers into believing that its operation of the Gambling Websites in California is legal. It is not.”
The lawsuit alleges that FanDuel has violated numerous California laws. They include Penal Code Sections 319, 320, 321, 330, 330a, 337a, and 337j. It argues that “no person in this state has a right to operate a gambling enterprise except as may be expressly permitted by the laws of this state.”
Dropped, But Not Dead
On September 8, Beltran’s attorneys filed a Notice of Voluntary Dismissal Without Prejudice, stating:
“Pursuant to Federal Rule of Civil Procedure 41(a)(1)(A)(i), and subject to the terms of the separately executed tolling agreement with defendants, Plaintiff Martin Beltran hereby gives notice that this action is voluntarily dismissed without prejudice.”
“Without prejudice” is a key phrase, as it means Beltran can refile the case. There’s also a tolling agreement, which pauses the statute of limitations. That allows the class to revive the lawsuit later.
DFS’s Uncertainty in California
The voluntary dismissal comes amid increased legal pressure on DFS in California. In July, Bonta issued a formal opinion in which he declared that all DFS, including the controversial, pick ‘em-style and peer-to-peer, is “illegal gambling” under California law.
He highlighted that DFS involves wagering on “the performance of athletes in future sporting events”, which makes them no different than sports betting, which remains prohibited in California.
Several major DFS operators, including PrizePicks and Underdog Fantasy, pivoted their strategies and replaced their pick ‘em contests with peer-to-peer contests. The change comes as they believe peer-to-peer contests hold better legal defenses. That’s because they remove the house as a participant, and they claim it’s a skill contest.
Bonta’s opinion does not change the law. Still, it carries significant weight for courts and enforcement agencies. A few weeks after releasing his opinion, he warned operators that enforcement action was forthcoming.
California regulators or district attorneys have yet to follow up with lawsuits or cease-and-desist orders. Still, Beltran could use those developments to revive the case, a possibility afforded by the tolling agreement.
For now, the lawsuit is off the docket, but the legal fight over DFS in California is far from settled.
