Intrigue. Clandestine meetings. Your typical spy novel? Nope, just attempts to lure employees from DraftKings to Fanatics. Similar episodes occur between casino companies when a new firm arrives in town where an existing company has already laid down roots.
The center of this caper is one Michael Hermalyn, a former DraftKings senior vice president now with Fanatics. In filings, DraftKings says Hermalyn spilled confidential info. And to make matters worse he contacted high-value bettors. The Boston-based sportsbook seeks a preliminary injunction instead of a temporary restraining order, according to Legal Sports Report.
Hermalyn joined Fanatics a week before the Super Bowl. The District Court of Massachusetts did not step in to prevent the new arrangement.
Hermalyn wants the case and non-compete agreements dismissed because he relied on California state court where such agreements are not permitted. He also wants DraftKings to pay his legal fees as well.
DraftKings recently filed new information about the solicitation of two employees Hermalyn tried to bring to Fanatics. Andrew Larracey and Hayden Metz phoned Hermalyn from a DraftKings conference room. Hermalyn asked the two to scan the room to prove they were alone. He told them which positions to seek: a senior director for Larracey and a vice president for Metz.
The three discussed income and relocation to Los Angeles to avoid the non-compete clause. Hermalyn promised Fanatics would cover legal fees tied to non-compete violations.
DraftKings said this alone was using confidential information because Hermalyn relied on salary figures he knew the men made, which he only knew because of his access to confidential information.
During his deposition, Hermalyn stated he never connected to the internet at a Fanatics office, as DraftKings previously thought. But he did admit he used a Fanatics IP address while staying at the home of Fanatics CEO Michael Rubin.
