Ex-DraftKings Executive Challenges Non-Compete Restrictions at Fanatics

Former DraftKings executive is fighting against their non-compete agreement.

Michael Hermalyn, who used to work for DraftKings, is challenging a court decision that is stopping him from starting a new job at Fanatics. He wants the court to remove or at least ease these restrictions, saying that in California, where he is, employment contracts that stop people from moving to new jobs are often not allowed.

What Happened

DraftKings sued Hermalyn for not following their agreements about not competing and not taking customers, and for using secret company information. A judge in Boston decided Hermalyn did these things and said he has to follow certain rules at his new job at Fanatics. But Hermalyn and his lawyers argue that the laws in California should be used, not the ones from Massachusetts.

Why This Matters

This situation shows that businesses often use non-compete agreements to look after their own interests. What happens here could affect how easily workers in the sports betting market can change jobs.

The Appeal Details

• Hermalyn’s job at Fanatics now has serious limits.
• His lawyers argue California’s laws should govern, favoring fewer restrictions on Hermalyn.

The appeal argues that the law in Massachusetts should not apply because Hermalyn lives and has a job in California. It asks to cancel or change the court order to not cover California.

Fanatics and DraftKings Respond

Fanatics didn’t agree with everything the Boston court decided, but were happy that Hermalyn could still work for them. They think DraftKings is just trying to frighten the workers by suing. DraftKings, however, is satisfied with the court’s choice, claiming that Hermalyn took secret information to help Fanatics.

What's Next

DraftKings has to fight to keep a court order in place in California. The hearing is scheduled for June 4. Hermalyn will keep working at Fanatics with strict rules while the legal proceedings go on.

The court case shows strong competition between companies to win customers and keep important business secrets in the sports betting industry.