Daily fantasy sports continues to stew in a pot of controversy, but progress is being made as lawmakers sort through the legal details of the highly popular online activity. States like Virginia and Indiana have just signed DFS bills into law, but the differences in these laws could leave the fate of DFS uncertain.
Daily Fantasy Sports Legalized In Indiana and Virginia
On the surface, new laws created by Indiana and Virginia look similar. Both laws set a minimum age limit of 18, both laws institute a $50,000 registration fee for DFS companies, but the difference in these bills won’t help other states figure out how they are going to treat the gaming sensation.
What Do These DFS Bills Mean?
In Virginia, DFS will be regulated by the Department of Agriculture and Consumer Services because the bill says that DFS is a skill-based hobby. However, Indiana seems to be calling DFS a gambling activity, and so DFS will be regulated by a new department within the Indiana Gaming Commission. This could mean that DFS is considered gambling only in certain states, which could serve to further complicate the issue and leave DFS companies in a strange limbo.
What If DFS Be Considered Gambling?
In Texas, the Attorney General Ken Paxton declared that DFS was illegal gambling and he believes the Texas courts will agree with him. If this is true, then DFS companies could be fined and required to refund Texas users’ every cent spent on their site. In New York, a similar battle is being waged between the AG, DraftKings and Fanduel. New York AG Eric Schneiderman filed an injunction against these DFS companies to ban them from operating in the state because his office considers paid DFS gambling. Now the state and two companies have reached a settlement that will exempt the companies from paying any fines if they are found guilty of gambling charges in the state.
What About Allegations About DFS Cheating?
The FBI is also investigating these daily fantasy sports leagues over allegations of insider trading, and here in Florida, our firm Colson Hicks Eidson is pursuing a class action suit against FanDuel and DraftKings for using “sniping software” and “shark bettors” to rig their games. It’s still not clear where Florida will land on the legalization issue of DFS. Some want to ban the online games as betting, and others want to make it a part of Florida’s gaming regulations, but we will stay on top of the issue and let you know what the Florida courts decide.