New York State's Attorney General rules fantasy sports illegal

Daily fantasy sports industry’s leaders FanDuel and DraftKings have both received a cease-and-desist order from New York State’s Attorney General Eric Schneiderman, who ruled the games to be illegal gambling under state law.

FanDuel and DraftKings have both been served with cease-and-desist orders with Attorney General Eric Schneiderman commenting the pair had “intended to evade the law and fleece sports fans across the country”. The letter from New York Attorney General also said DFS constitutes illegal gambling because a person stakes or risks something of value upon the outcome of a future contest of chance or contingent event not under his control or influence. “DraftKings’ customers are clearly placing bets on events outside of their control or influence, specifically on the real-game performance of professional athletes,” the letter to DraftKings said. “Further, each DraftKings wager represents a wager on a 'contest of chance' where winning or losing depends on numerous elements of chance to a 'material degree'," it added.

The Attorney General’s ruling is similar to that of the Nevada Gaming Control Board, which recently ruled that DFS met the definition of gambling under state law and thus operators were required to apply for a sports betting license.

FanDuel contested the attorney general’s verdict and reiterated its belief that fantasy sports was legal under New York state law. “Fantasy sports is a game of skill and legal under New York state law,” the statement from the company said. “This is a politician telling hundreds of thousands of New Yorkers they are not allowed to play a game they love and share with friends, family, co-workers and players across the country.” The company also sent an email to its customers, stating, “that the Attorney General of New York wants to take away your right to play fantasy sports in New York. Yep, you read that right: Eric Schneiderman wants to make them illegal in your state. We need to make sure he knows how many of his constituents love this game before he tries to ban it.” The FanDuel also asked them to send an email to Attorney General Schneiderman using its online tool to tell him they support daily fantasy sports. “Eric Schneiderman should be focusing on the real problems facing this state, instead of a hobby that makes watching your teams more fun. This is something all New York sports fan, regardless of allegiance, can agree on. But he is determined to make daily fantasy sports a thing of the past here, so he needs to hear from New Yorkers like you who know this is a game of skill and passion, not chance. If enough of us make our voices heard, he will not be able to ignore us. Tell Attorney General Schneiderman that you are a constituent demanding the right to continue playing daily fantasy sports now”, the message added. New York is one of the DFS industry’s most lucrative markets boasting more than half-a-million registered players and the ruling could well have ramifications in a number of other states currently reviewing the activity.

Meanwhile a spokesperson for DraftKings said it disagreed with the judgment and would “examine and vigorously pursue all legal options available”. 

Source: eGR Magazine