On Tuesday, New York’s attorney general ordered daily fantasy sports companies DraftKings and FanDuel to stop accepting bets in the state, calling their operations illegal.
In two separate letters sent to both companies, Attorney General Eric Schneiderman said that following a one-month investigation, his office had concluded that daily betting contests are games of chance and not skill.
He also drew a sharp line between the operations of daily fantasy sports sites and traditional fantasy leagues. Schneiderman says that operations of such websites are legal because these sites rely on months of smart play over the course of an extensive period. However, he says that the likes of DraftKings and FanDuel are more about “instant gratification” and do not require a long-term strategy.
The attorney general also discussed advertisements by the two companies including one from Draft Kings where the site was promoted as “the simplest way of winning life changing piles of cash.” Schneiderman says that the punch-line misled players about their chances of winning before revealing that most of the prizes are won by the top 1 percent of players.
“Daily fantasy sports is neither victimless nor harmless, and it is clear that DraftKings and FanDuel are the leaders of a massive, multibillion-dollar scheme intended to evade the law and fleece sports fans across the country,” Schneiderman said in a statement issued after the letters were sent.
However, it is clear that both companies are not going to go down without a fight with representatives from both betting sites stating that the games are legal and based on skill set before informing press that they are currently reviewing their legal options. According to the attorney general’s letter, both companies have only five days to respond and prove why he should not initiate legal action.
In a statement, FanDuel lashed out at Schneiderman, calling him a politician who can now have a lot of press coverage at the expense of a business that has been followed by so many people for such a long time.
“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,” FanDuel said in a statement. “The game has been played — legally — in New York for years and years, but after the attorney general realized he could now get himself some press coverage, he decided a game that has been around for a long, long time is suddenly now not legal.”
DraftKings was equally disappointed in the attorney general’s actions and said that Schneiderman did not even both to take some time out to understand the betting business and find out why fantasy sports are a game of skill before revealing that the company will explore every legal avenue to seek justice.
“We will vigorously pursue all legal options available to ensure our over half a million customers in New York state can continue to play the fantasy sports games they love.”
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