Back and forth
An executive for Fanatics Betting and Gaming has hit back at allegations that he had a secret plan to steal a competitor’s customer information. DraftKings filed a lawsuit on Monday alleging that former employee Michael Hermalyn formed this scheme over a year ago with Fanatics CEO Michael Rubin. Hermalyn joined Fanatics about a week ago as the president of VIP operations and labeled the complaint’s allegations as “completely false and fabricated.”
he expected DraftKings to target him after leaving the job
Hermalyn filed a declaration in the US District Court of Massachusetts in which he explained that he expected DraftKings to target him after leaving the job as it allegedly did so with other people in the past. He is shocked that the operator went so far as making these claims and accusations.
Serious claims
DraftKings alleges that Hermalyn said that he needed two days off work last month following the death of a close friend, but instead flew to Los Angeles to visit the Fanatics head office. It also claims that its former employee downloaded confidential Super Bowl business plans while in its competitor’s office. He denies that he “falsely claimed to be mourning the death” of his friend and noted that he was trying to advance his career.
Hermalyn said he only received the job offer two days after taking time off and he went to Pennsylvania to meet with Rubin and not Los Angeles. He officially accepted the job on February 1 and denied having any conversations with Fanatics last year.
claims that Hermalyn is violating his 12-month global non-compete
DraftKings claims that Hermalyn is violating his 12-month global non-compete, while the former employee contests that this clause is very restrictive and not enforceable in California where he now lives and works. Hermalyn was at DraftKings for over three years.
Talking about the complaint, a spokesperson for Fanatics said that the attempts to ruin its new executive’s reputation “sheds some light on why employees may be choosing to leave that organization.”
Protecting trade secrets
Sportsbook operators closely guard information about their VIP operations as they don’t want competitors poaching their best-paying customers. Companies often offer bonuses, cashback on losses, and tickets to high-profile sporting events to keep their VIP clients happy.
In his previous role at DraftKings, Hermalyn had access to many trade secrets and knew the identities of the big bettors and their preferences. He also knows the strategies that the Boston-based operator deploys to keep these people happy. The complaint says that Hermalyn also had access to employee lists, salary information, and performance reviews that could lead to Fanatics poaching DraftKings talent.
Other allegations include possible workplace misconduct from female co-workers and a claim that he used a corporate credit card for his personal gain. Hermalyn says nothing ever came of these investigations.