The founders of FanDuel are suing the site’s new owners, Paddy Power Betfair, for $120m alleging that the company was purposefully undervalued during the transaction.

“Nigel Eccles created the fantasy sports site FanDuel back in 2009, and when it was acquired by European gambling company Paddy Power Betfair earlier this year, FanDuel was valued at $465 million,” reports Recode’s Kurt Wagner.

“It’s the kind of deal you would assume would make Eccles a very rich man. Apparently that wasn’t the case.

“Eccles, who stepped down as CEO about six months before Paddy Power took a controlling stake in FanDuel, didn’t make a dime on the deal thanks to a ‘waterfall’ financial arrangement in which some of the company’s early investors were paid out first.

“FanDuel’s $465 million valuation wasn’t large enough that people who owned non-preferred shares — mostly regular employees, including founders — actually made any money.”

Recode has posted the petition submitted to Scotland’s Court of Session.

“The decision of the board (whose interests are aligned with preference shareholders), not to seek and act upon a new market valuation in the face of a material event, which is likely to have significantly increased the market valuation of FanDuel, is a breach of its fiduciary duties,” the petition reads.

Current FanDuel executives – including Eccles’s replacement as chief executive, Matt King – are set to make millions on the merger.

“The petition is simply not rooted in facts or reality,” a FanDuel spokesperson told Recode . “In preparation for this deal, an exhaustive process was undertaken with the anticipation of PASPA’s likely repeal.

“The deal was consummated consistent with the corporate governance rules and cap table established under the former founders’ leadership. The facts are that this was a sound business transaction that achieved the highest valuation possible for shareholders and was the right strategic move for the company’s future.”

Eccles’s petition is the latest saga in what has been years of drama for FanDuel, writes Wagner.

“First the company spent massive amounts of money on advertising while competing with rival DraftKings in the U.S. That advertising ultimately caught the attention of U.S. regulators, some of which thought FanDuel should be considered sports gambling, which was illegal. That led the company to spend massive amounts of money fighting legal battles.

“Then FanDuel and DraftKings finally decided to merge in late 2016, a decision that many on both sides believed should have happened years earlier. That deal was essentially blocked by the Federal Trade Commission, so the companies dropped the merger.

“Now, after years of arguing that daily fantasy sports should not be considered sports gambling, Eccles is hoping that new laws paving the way for sports gambling may finally bring him his payday.”