Eric Schneiderman

FanDuel hits back after being told to ‘cease & desist’ in New York State

Eric Schneiderman
Eric Schneiderman

DraftKings and FanDuel have been dealt another regulatory blow in the US after New York Attorney General Eric Schneiderman sent the two Daily Fantasy Sports (DFS) operators cease-and-desist letters demanding that they stop ‘illegally accepting wagers in New York State’.

Schneiderman’s actions come after his office conducted a one-month investigation into DFS which concluded that the daily contests are essentially games of chance, not skill.

However FanDuel has responded with a strongly worded statement accusing Schneiderman of chasing publicity. It said: “Fantasy sports is a game of skill and legal under New York State law. 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, coworkers and players across the country.

“The game has been played — legally — in New York for years and years, but after the Attorney General realised 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. We have operated openly and lawfully in New York for several years. The only thing that changed today is the Attorney General’s mind.”

DraftKings also expressed its disappointment with Schneiderman. “We strongly disagree with the reasoning in his opinion and will examine and 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.

“We continue to see a number of other officials, including Senator Negron in Florida, Representative Zalewski in Illinois and the Federal Trade Commission, take a reasoned, informed and measured approach to the daily fantasy sports business. We hope this trend continues along with due consideration for over 56 million sports fans across the country who enjoy playing fantasy sports. We remain committed to working with all relevant authorities to ensure that our industry operates in a manner that is transparent and fair for all consumers.

“New York’s actions today are an unfortunate example of a state government stifling innovation, technology and entrepreneurship and acting without full and fair consideration of the interests of consumers.”

Schneiderman had even accused the operators of willingly evading the law. He said: “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.”

New York is not alone in its posituion however. Nevada regulators have already told DFS operators that that they need a gambling licence to operated in the state and New Jersey, Pennsylvania, Massachusetts and Georgia have reportedly all considered enacting their own rules.

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