NY AG Clashes With DraftKings and FanDuel Over Legality of Online Fantasy Sports Gaming Sites

Fantasy Football Fans Attempted To Sack NY Attorney General Schneiderman

Photo credit: Jacob Pramuk | CNBC

Photo credit: Jacob Pramuk | CNBC

Earlier today, 200 supporters of daily fantasy sports sites FanDuel and DraftKings gathered outside New York State Attorney General Eric T. Schneiderman’s New York City office at 120 Broadway  to protest the state attorney general’s order that they cease operations in New York. Hours later, DraftKings and FanDuel sued AG Schneiderman arguing that his interference with their business operations and actions that would cause irreparable harm.

The two DFS companies asked the court to provide it with the means to conduct their business in the state as the legal battle proceeds. FanDuel, however, stopped accepting new deposits in New York as of Friday, yielding to the state attorney general’s order.

In its petition, DraftKings called Schneiderman’s order to cease taking business from customers in New York a “shocking overreach.”

Later in the day, the Attorney General released this statement:

“The Attorney General’s job is to enforce New York State law, and the law here is clear. Online sports gambling sites are illegal in New York. DraftKings and FanDuel are operating illegal sports betting websites under New York law, causing the same kinds of social and economic harms as other forms of illegal gambling. As a result, our office issued a cease and desist letter to stop them from violating state law by accepting bets from people in New York. Because both companies have refused to follow the law in our state, we will take action to enforce state law.”

On Tuesday, Attorney General Eric Schneiderman issued cease-and-desist letters to daily fantasy sports (“DFS”) wagering sites DraftKings and FanDuel, ordering both companies to immediately stop accepting wagers inside New York. Schneiderman’s action follows an investigation by his office that found DraftKings and FanDuel to be in violation of New York State law against illegal gambling. Traditional, season-long fantasy sports are not implicated by the AG’s action.

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