FanDuel and DraftKings Daily Contests Ruled Illegal

The daily fantasy contests such as those operated by FanDuel and DraftKings are seen as illegal after an appellate court in New York ruled that a 2016 law that legalized such games violated a constitutional prohibition on gambling.

The court upheld a lower court’s ruling that the legislature illegally authorized the activity, which was classified as a game of skill, not a game of chance.

“We’re very gratified by the decision. We think the integrity of the New York state Constitution has been upheld,” said attorney Neil Murray, representing the group that brought the lawsuit.

In 2016, Gov. Andrew Cuomo signed a bill into law that allowed companies like DraftKings and FanDuel to operate and be regulated in New York. Also in 2016, then-Attorney General Eric Schneiderman, accused the two companies of being illegal gambling companies, and DraftKings and FanDuel settled, agreeing to suspend their business operations in the state.

Challenged

The Stop Predatory Gambling group coordinated the lawsuit that challenged the constitutionality of the law on behalf of four plaintiffs who had suffered personal or family harm for gambling debts.

“The reason New York state has a constitutional prohibition on commercialized gambling promoted by the state is because it’s a form of consumer financial fraud. This isn’t about people having a Super Bowl office pool. This is about state government cheating and exploiting people, contributing to the huge debt culture in the state,” said Les Bernal, national director of Stop Predatory Gambling.

A spokesman for Attorney General Letitia Lames said that the staff are reviewing the decision and that it hasn’t been decided whether it will be appealed to the state’s highest court, the Court of Appeals.

“We believe the legislative action authorizing fantasy sports in New York was constitutional and in the best interests of taxpayers and fantasy sports fans,” DraftKings said in a statement.

About the Fantasy Sports Provider

As a global sports technology and entertainment company, this brand’s mission is to bring fans closer to the games they love. That is achieved via a unique combination of daily fantasy sports, sports betting and median platforms.

The company was founded in 2012, and has headquarters in Boston, Massachusetts. Across 13 professional sports in 8 countries including the U.S., Canada, Australia and U.K., it offers daily fantasy sports contests. Operating under the regulation of the states of New Jersey and Mississippi, the provider allows players in the states to engage in betting for major U.S. and international sports.

Source:

“Court Rules Fantasy Sports Contests Are Illegal Gambling”, time.com, February 7, 2020.