Fantasy sports sites fight back against cease and desist letters

“Our investigation has found that, unlike traditional fantasy sports, daily fantasy sports companies are engaged in illegal gambling”, NY Attorney General Eric Schneiderman said in a press release.

“Players can certainly still bet on FanDuel”, added Nigel Eccles, the company’s chief executive officer. “We’re going to use every avenue we can to stay open”. Both companies say they have large numbers of clients in NY, including business deals with the National Football League, Major League Baseball, the National Basketball Association and other professional sports that are headquartered in the state.

“We will have a big presence at the conference this weekend”, a FanDuel spokesperson said. A smaller operator, DraftPot, announced Tuesday that it would remain operating in NY, tweeting the hashtag #FantastForAll alongside a link to Jay Z’s song “Empire State of Mind”.

Federal law exempts fantasy sports from online gambling statutes, classifying it as a game of skill. He threatened legal action unless they stop accepting play from NY. “At the end of the day, you had two companies develop a near oligopoly and now we have a bit of a crisis on our hands”. That law makes it federally illegal to run a gambling business that operates in violation of state law.

TSN has learned the CGA commissioned Don Bourgeois, former general counsel for the Alcohol and Gaming Commission of Ontario, to examine the legal standing of fantasy sports.

Congressman Chris Collins says fantasy sports are a legal operation under state law, and new laws would have to be passed to change that.

At least one politician took the side of daily fantasy companies on Wednesday.

“We will pursue this fight to the fullest to ensure that NY fantasy sports fans do not need to stop playing the games they love”.

The decision of DailyMVP officials signals the uncertainty of fantasy sports in NY State, despite the fact that FanDuel and DraftKings say they plan to take legal action to keep their services legal in NY State.

That could be irrelevant – if Minnesota’s Attorney General Lori Swanson follows New York’s lead.

But whether or not daily fantasy sports requires strategy is at the heart of its controversy. The attorney general gave the companies five days to respond.

In the advent of football season, many fans participate in fantasy football in hopes of winning a few money or earning bragging rights over their friends.

New England Patriots owner Kraft also called for more industry regulation while defending his equity purchase in DraftKings.

Although Schneiderman’s letter asserted that daily fantasy games was a game of chance not skill, and therefore constitutes illegal gambling, Eccles challenged that interpretation. Joe Negron and Rep. Matt Gaetz would declare that fantasy sports were games of skill and not forms of gambling.

In the meantime, doing a big grandstanding rush job to shut these sites down to get all the headlines, without the benefit of a careful review and thoughtful understanding of the issues at play just seems like Schneiderman, once again, reminding innovative startups that NY is not welcoming for such innovation.