FanDuel Announces Arbitration Filing Against Co-Founder Nigel Eccles

All is not well in the FanDuel family.

FanDuel, the sportsbooks giant has announced it is seeking arbitration with co-founder and former CEO Nigel Eccles. The company accuses him of repeatedly breaching his operation agreement from 2017. 

The disagreement revolves around a lawsuit Eccles is pursuing against FanDuel. He believes that private equity firms conspired to squeeze out FanDuel’s founders and many of the original stockholders by undervaluing the platform before a 2018 sale.

FanDuel believes that Eccles has gone out to hunt down more plaintiffs to help buffer the suit. This qualifies as a breach of the founder’s separation agreement, which means he should be forced to return the money he was paid as a part of the deal.

Eccles didn’t take long to respond after FanDuel’s announcement. 

“KKR, Shamrock, and FanDuel’s former board are clearly fearful of confronting their misdeeds that our lawsuit has brought to light.” Eccles shared in an interview with Next.io. “Instead of confronting the allegations in court, they have now decided to sue me for bringing the lawsuit in the first place!”

FanDuel is looking to reclaim around $8 million from Eccles through arbitration. 

FanDuel Claims Eccels is Rewriting History

Nigel Eccles has been insisting he was squeezed out of the company, but FanDuel claims the former CEO is trying to save face.

A filing in Eccles's lawsuit documented that he was mismanaging the company, leading to $232 million in accumulated losses in 2017. 

“The reality, as their new documents show, is that after Lead Plaintiff Nigel Eccles mismanaged [FanDuel Limited] into the ground, the Director Defendants were forced to step in, pursue a buy-out that Plaintiffs had facilitated, and accept the highest available offer—indeed, the only lifeline that would save FDL from collapse,” the filing says. “As a result, Plaintiffs’ claims all fail.”

This forced the private equity firms and many board members to view a sale as their only option to survive. This led to a low valuation when the company was sold the following year.