DraftKings/FanDuel File Lawsuits In Response To Schneiderman Decision

“We are asking the NY Supreme Court to rule that the attorney general’s cease-and-desist letter is unconstitutional, an abuse of discretion, and simply wrong”, the company said in a statement. However two of the nation’s biggest sites are proactively filing a lawsuit in New York NY to forestall the state from shutting them down. In NY, the criteria for determining what is considered skill-based is much more rigorous than in other states, and the NY Attorney Genreral’s office has determined that in their state, DFS play falls under their determination as “gambling”.

Schneiderman gave DraftKings and FanDuel five days to respond to his letter before initiating legal proceedings against them in an attempt to shut them down in NY.

Schneiderman says both sites have acted in violation of state gambling laws.

Meanwhile, Jim Baumbach of Newsday noted around 300 people rallied in front of Schneiderman’s Manhattan office Friday morning in support of DFS games.

“Anyone who asks us about the legality of online sports betting will be told exactly what we wrote in our letters”, attorney general’s spokesman Matt Mittenhal said Friday.

While Pate said the average player likely won’t be prosecuted the operators could face heavy penalties – especially considering there are two federal criminal investigations ongoing in NY and Florida. The industry has long argued that daily fantasy sports are games of skill, not games of chance like those on a casino floor.

The lawsuits contend that an order this week by state attorney general Eric Schneiderman is an improper use of administrative authority against legal businesses.

The protest was organized by Fantasy Sports For All, a group that was created by leading providers to “protect the rights” of daily fantasy sports players.

NY is one of seven states in the country that ban the contests.

As these lawsuits move through the legal system, we’re likely to see both companies try to recruit users to advocate on their behalf.

The fantasy sports industry found itself in the spotlight in September, after DraftKings employee Ethan Haskell, won $350,000 at FanDuel shortly after releasing game line-up data before the start of the third week of the National Football League (NFL) season.