Nearly a year after Mike Hermalyn abruptly left his post at DraftKings to go run the VIP program at Fanatics the two parties have settled the matter in court.
The day after Christmas DraftKings voluntarily dismissed its lawsuit against its former employee. The dismissal comes just a few weeks before Hermalyn’s one-year non-compete agreement expired.
Hermalyn left DraftKings with no notice on Feb. 1 and immediately began working as the new Head of VIP for Fanatics. DraftKings sued Hermalyn, saying he violated his non-compete and took company secrets to the competitor just days before the 2024 Super Bowl.
Over the course of the year, the two parties sparred back and forth, with Hermalyn calling DraftKings a toxic workplace and alleging that CEO Jason Robins was jealous of his relationships. DraftKings claimed that Hermalyn stole several confidential documents, including VIP customer information, before defecting to Fanatics.
A February court order limited the scope of Hermalyn’s role with Fanatics to not include interactions with former DraftKings customers or partners but did not force him to cease working with the operators. A second order in April further limited the nature of his work.
“DraftKings, Fanatics, and Mr. Hermalyn engaged in multi-jurisdiction litigation related to Mr. Hermalyn’s departure from DraftKings and commencement of employment with Fanatics. All litigation between them has been settled and dismissed on confidential terms, and Mr. Hermalyn will abide by his contractual commitments to DraftKings,” a Fanatics spokesperson told SBC Americas.
The case was still moving forward with the injunction in place after Hermalyn’s motion to dismiss was denied in April. The parties were still in the discovery process when they reached the agreement to settle.
While the drama in the courtroom drew headlines, Fanatics has quietly made quite a dent in sports betting market share over the course of 2024 and is starting to rival BetMGM and Caesars in several key markets such as New York.
