Daily fantasy sports contests such as those run by FanDuel and DraftKings are now faced with an uncertain future in New York – this, after an appellate court ruled on Thursday that a 2016 law legalising these games violated a constitutional ban on gambling.
The court endorsed a 2018 lower court’s ruling that the Legislature unlawfully authorised the activity by categorising it as a game of skill, not chance.
The ruling is now expected to head to the state’s top court, the Court of Appeals. It is not yet clear if the players will be able to continue to participate in the contests pending the next appeal. The contests have been ongoing since the last ruling.
Companies like DraftKings and FanDuel were allowed to operate and be regulated in New York in 2016 when Governor Andrew Cuomo signed a bill for this into law. The 2 fantasy sports companies had consented to suspend their operations in New York earlier that year in a settlement with then-Attorney General Eric Schneiderman, who said their businesses amounted to illegal gambling.
The constitutionality of the law was challenged by a lawsuit brought forward by the group Stop Predatory Gambling, acting on behalf of 4 plaintiffs who had suffered personal or family harm from gambling debts.
Les Bernal, national director of Stop Predatory Gambling, said on Thursday, “The reason New York state has a constitutional prohibition on commercialised gambling promoted by the state is because it’s a form of consumer financial fraud. This isn’t about people having a Super Bowl office pool. This is about state government cheating and exploiting people, contributing to the huge debt culture in the state.”
Letitia James, a spokesman for Attorney General, said, “We believe the legislative action authorising fantasy sports in New York was constitutional and in the best interests of taxpayers and fantasy sports fans.”
Rob Rosborough of nysppeals.com, an expert on state courts, believes the games can continue while the state appeals the latest court ruling.
“Much to unpack here, but most immediately, the State will undoubtedly appeal as of right to the NY Court of Appeals based on the substantial constitutional question and will get an automatic stay of the order. So #DFS can continue in NY, for now. The future is much less certain,” Rosborough tweeted today.
Source – Igaming world