Fantasy sports sites allowed to operate in NY during appeal

In news first reported by ESPN’s Darren Rovell, the five-judge panel opted to allow for daily fantasy companies to continue operating in the state until the larger court appeal on the industry’s legality is decided.

Another DraftKings lawyer, Randy Mastro, said the decision means “hundreds of thousands of New Yorkers who love fantasy sports can continue the contests they love”.

David Boies, counsel to DraftKings and Chairman, Boies, Schiller and Flexner LLP released a statement soon after the ruling saying, “We are pleased with the Court’s ruling today”.

The cases are FanDuel Inc. v. Schneiderman, 161691/2015; DraftKings Inc. v. Schneiderman, 102104/2015; People v. DraftKings Inc., 453054/2015; and People v. FanDuel Inc., 453056/2015, New York State Supreme Court, New York County (Manhattan).

State Supreme Court Justice Manuel Mendez issued a temporary injunction in December, ruling that they are likely in violation of the state’s gambling law and ordering them to shut down during their trial.

“As our litigation continues, we expect an appellate court to see what we have known since the outset: Daily Fantasy Sports is a game of knowledge and Skill”, Boies said.

There was no immediate reaction from Schneiderman’s office.

Massachusetts’ attorney general on Monday said it would hold a public hearing regarding its proposed consumer protection regulations for daily fantasy sports contest operators in that state on Tuesday.

Of course, NY isn’t the only state that both sites are fighting to operate in.

Editor’s Note: CBS has an investment in FanDuel of less than 1 percent of that company’s value.

In daily fantasy sports games, a player assembles a roster of athletes and wins or loses based on their real-life performances on a game day, with some contests offering prizes in the millions of dollars. Now they’ll be allowed to open their paid services up again to New Yorkers.

Both sites have asserted that their fantasy games are not gambling, but rather are games of skill.

Claims that the high-profile DFS sites conduct illegal gambling practices were topped off when Schneiderman served the two sites cease-and-desist letters back in November.