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LeBron James of the Los Angeles Lakers reacts during the second half against the Memphis Grizzlies, and he was involved in a decision by the Massachusetts Gaming Commission due to incorrectly priced player props for James at DraftKings.
LeBron James of the Los Angeles Lakers reacts during the second half against the Memphis Grizzlies. Photo by Justin Ford/Getty Images via AFP.

DraftKings managed to avoid serious damage to its reputation and bottom line with a ruling Thursday by the Massachusetts Gaming Commission.

DraftKings requested that 178 bets taken on an Oct. 24 NBA contest between the Los Angeles Lakers and Denver Nuggets be voided. Incorrect, bettor-friendly odds posted by a third-party vendor led to some lucrative wins for a number of customers.

Thanks to the commission's decision Thursday, DraftKings ultimately voided the bets, though it will provide some compensation to those who placed a wager with the mistaken odds.

The issue in question

Incorrect odds were posted by one of the best Massachusetts sports betting apps, DraftKings, on a same-game parlay on Oct. 24. The odds were set by third-party vendor Sportcast, a company no longer associated with one of the best sportsbooks. Sportscast has had similar problems with bettor-friendly odds in the past.

Miscommunication led to incorrect odds on a wager involving LeBron James, among others, and prop bets for the Oct. 24 game between the Lakers and Nuggets. For LeBron, his totals were listed at 8.5 points, 2.5 rebounds, and 6.5 assists.

DraftKings said those numbers were meant to reflect first-quarter totals rather than the whole game. James finished with enough points and rebounds to clear both incorrect lines.

The odds in question were live for only 13 minutes during the day, but 138 bettors and 178 wagers took advantage of the mistake. A total handle of $4,182.36 resulted from the parlays, and DraftKings lost $575,436.

The ruling

The Massachusetts Gaming Commission met Thursday and ultimately voted in favor of DraftKings by a margin of 3-2. It means that DraftKings will not have to pay the $575,336 in total winnings.

However, regulators in the Massachusetts sports betting industry didn't completely let the American sports betting behemoth off the hook. DraftKings, one of the best sports betting apps, will have to pay 300% of the original bet stake to the involved bettors.

It was a compromise suggested by Massachusetts Gaming Commissioner Nakisha Skinner. Another Commissioner, Jordan Maynard, said following the ruling: “I can't stomach the fact of enriching a group of people that were taking advantage of the system.”

The ruling was not unanimous, with two commission members voting against one of the best sports betting sites.

Lessons learned?

Along with the explosion of the U.S. legal sports betting industry, an increasingly sophisticated sports betting public has emerged. Bettors are shopping odds and taking advantage of the ones that suit them best.

Mistakes by sportsbooks and sports betting providers are not slipping under the radar, as the DraftKings snafu has further emphasized.

The most recent incident isn't the only such situation on the books. The same Massachusetts Gaming Commission intervened in a similar player props incident with Barstool. Props were posted for a game that was already decided.

Meanwhile, a bettor using one of the best New York sports betting apps had a $300,000 bet with DraftKings recently voided after incorrect odds were posted by, you guessed it, Sportcast in January.

As long as sportsbooks continue to offer the volume of sports bets currently available, and as long as third-party vendors are such a huge part of the overall wagering scene in the American market, mistakes will likely continue.