Connect with us

Entertainment

Ex DraftKings exec claims it ‘torched his reputation’ for leaving, as 186 apply to rival Fanatics in three years

Published

on

/ 3743 Views

A former DraftKings exec is accusing the betting platform in legal documents of making “brazen attempts to torch [his] reputation,” and having a “long history of aggressively smearing employees.”

Former DraftKings vice president of growth Michael Hermalyn alleges in bombshell court papers filed on Thursday in Massachusetts federal court that employees at DraftKings (DK in court papers) are “attempting to flee a culture of retribution,” and that the company is trying to make an example out of him to “instill fear in other DK employees looking to jump ship and halt lawful recruiting activity by Fanatics.”

In fact, the papers allege, a staggering 186 DraftKings employees have applied for positions at Fanatics since 2021.

Michael Hermalyn
Michael Hermalyn is firing back at DraftKings in court. LinkedIn

Hermalyn’s lawyers argue that DraftKings’ allegations that the exec improperly left the firm for a rival are a losing bet because Hermalyn did nothing wrong when he became president of Fanatics VIP and the head of the sports firm’s Los Angeles office.

DraftKings is suing Hermalyn for allegedly downloading its business plans, and alleges that he secretly met with Fanatics CEO Michael Rubin at the Super Bowl before he went from one company to the other.

But Hermalyn’s lawyers say in their latest filing that what “DK now spins is a fabrication. And key pieces of the story that DK originally concocted when it first filed this lawsuit have now evaporated.”

The papers add that DraftKings “have now completely abandoned what was once the heart of its salacious narrative — and with good reason: they are fabrications designed to malign and destroy the reputation of a senior employee who had the audacity to seek out a better opportunity.”

An initial filing by DraftKings claimed Hermalyn even “falsely claimed to be mourning the loss of a friend from Pennsylvania,” when he, “instead secretly traveled to Fanatics offices in Los Angeles” to exit DraftKings, sources said.

But a subsequent filing backed down on the claim by stating instead that the exec simply “sent an email to his DK colleagues saying his friend had died, and canceled meetings scheduled for January 29 and 30.”

DraftKings
DraftKings is seeking an injunction against its former vice president of growth, Hermalyn. SOPA Images

The newly filed papers asking a judge to shoot down DraftKings’ request to bar Hermalyn from working at Fanatics say that “before he accepted his offer from Fanatics, Hermalyn went above and beyond to ensure that he no longer possessed any DK property, documents, or information.”

DraftKings is seeking to keep the exec from working in the Sports, betting and gaming industries, worldwide, for an entire year, the court papers say.

The papers also say that, “DK accuses Hermalyn of ‘introducing’ one of its customers to a Fanatics VIP employee at the Super Bowl. But DK doesn’t tell the Court that this customer was already a long-time customer of Fanatics well before Hermalyn joined Fanatics — since 2018.”

DraftKings
DraftKings and Fanatics were once planning to merge. AP

The papers add that, “this customer had attended a dinner with Fanatics’ Chairman and CEO months earlier, in October 2023, well before Hermalyn even began discussions about moving to Fanatics
earlier this year. Simply put, the customer needed no introduction.”

As evidence the papers include a pic of the customer in question with Fanatics founder Michael Rubin back in 2023, plus an Instagram post in 2022 of the same customer promoting the betting service.

While DraftKings “claims that Hermalyn ‘downloaded’ documents to a ‘non-DK device’ while still a DK employee,” Hermalyn responds that, “DK doesn’t tell the Court that the ‘non-DK device’ was Hermalyn’s personal phone, which he was authorized to use and routinely used for DK work during his entire time with DK.”

DraftKings
The legal battle is playing out in Massachusetts federal court. SOPA Images/LightRocket via Getty Images

The papers also claim, “DK also ignores that it does not even issue company phones to employees, and therefore all DK employees are authorized to and routinely use their personal devices for DK work,” and that, “DK’s very own Chief Information Security Officer, Brian Harris, conceded that he himself uses his personal phone to conduct work for DK.”

Hermalyn’s team also alleges that he didn’t download any info, but simply viewed files in the course of his normal work — and that DraftKings is defining downloading as simply viewing a document to do his job.

Hermalyn’s lawyers say that DraftKings’ claims he stole data are false, and that Hermalyn was “simply migrating files between DK-issued devices in the normal course [of Business] working with DK IT,” since, “DK issued Hermalyn a new work laptop and Hermalyn was completing the migration… from the old computer before returning it to DK.”

DraftKings
The papers say that nearly 200 DraftKings employees applied for Fanatics jobs. AP

Also in the court docs, Hermalyn defends himself against accusations that he solicited two DK employees to Fanatics, but says that, “these DK employees repeatedly reached out to Hermalyn, not the other way around, less than 24-hours after Hermalyn had started at Fanatics, or, consistent with that, that Hermalyn only responded to questions.”

The papers state that the DraftKings employees who contacted Hermalyn even devised the plan to contact him from one of their wives’ phones to “concoct a DIY conference call to cover their own tracks, and to avoid detection and retaliation by DK — which has a well-known history of aggressively pursuing employees who leave.”

The papers even say that one of the employees had already applied for a job at Fanatics back in 2022, as one of the “high volume of DK employees [who] have applied for a position with Fanatics since 2021.”

The docs say that DraftKings “failed to show that it suffered any actual harm that would warrant the extraordinary injunctive relief it seeks,” and that, “this is not a case in which an employee was hired to move a book of Business from one company to another: Fanatics already has 100 million customers in the U.S., each of DK and Fanatics have tens of thousands of VIP customers, and it is well known that many if not all those customers overlap.”

The docs also say that, “DK does not even allege any ongoing solicitation of employees or customers by Hermalyn. DK has not offered any evidence that Hermalyn actually used or disclosed DK’s confidential information or so-called ‘trade secrets.'”

Fanatics and DraftKings were once in discussions about a merger, with each company valued at about $24 billion, sources previously told The Post. But Fanatics reportedly opted to not go through with the deal.

When we reached out for comment, Orin Snyder, Gibson Dunn’s lead lawyer for DraftKings, said in a statement: “The evidence against Mr. Hermalyn is open-and-shut,” and, “We look forward to the upcoming hearing.”

Trending