After being banned in New York by the state attorney general, DraftKings is taking its fight to the state Supreme Court to have the ruling overturned.
The New York attorney general struck a huge blow against online, daily fantasy sports on Tuesday, ruling the operations to be nothing more than illegal online gambling and issued a cease and desist order. Now, the two biggest names in the business are fighting back.
While FanDuel opted to go the fan route, putting together an online petition from fans to have the ruling overturned, the larger of the two giants decided to go legal. According to Darren Rovell of ESPN, DraftKings has sent a petition of its own directly to the state Supreme Court asking them to rule against the attorney general and declare the cease and desist order unconstitutional.
DraftKings has filed a petition to the NY Supreme Court to rule that the Attorney General’s cease-and-desist letter is unconstitutional
— Darren Rovell (@darrenrovell) November 13, 2015
Daily fantasy sports is a mult-billion dollar industry and there is a lot at stake by shutting it down in one of the nations largest user bases. In its filing, DraftKings was adamant that their game differs from that of poker or other forms of online gambling, noting that the game requires skill. However, they focused their attack on the powers of the attorney general’s office and whether he had the ability to make sure a ruling.
"“Today, we have taken decisive legal action to prevent a unilateral, misinformed and legally misguided attempt by the New York attorney general to act as ‘judge, jury, and executioner’ for daily fantasy sports in New York.” (h/t Boston Globe)"
New York is not the first state to ban the games, with Nevada having done so in October. Including New York, there are now seven states where daily fantasy sports are no longer allowed, with neither FanDuel or DraftKings currently operating in Iowa, Louisiana, Arizona, Montana, and Washington.
The investigations into the practices began in earnest earlier this year, when in October the FBI became aware of an employee from DraftKings won a $350,000 pot at FanDuel, prompting allegations of insider information. That investigation is still ongoing, and the Bureau is also looking into the practices of both companies in the states where they are prohibited.
By petitioning to be reinstated in New York, both companies are hoping to regain access to over half a million subscribers who partake in the games. Whether or not the ruling is overturned will be in the hands of the courts, but there is a decidedly large amount of money at play here.