Fansided

FanDuel and Draftkings must halt business in the state of New York

By Jabari LeGendre

Sep 12, 2015; Dallas, TX, USA; A general view of the DraftKings sign board during the match with FC Dallas playing against New York City FC at Toyota Stadium. Mandatory Credit: Matthew Emmons-USA TODAY Sports
Sep 12, 2015; Dallas, TX, USA; A general view of the DraftKings sign board during the match with FC Dallas playing against New York City FC at Toyota Stadium. Mandatory Credit: Matthew Emmons-USA TODAY Sports /
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On Friday New York Supreme Court Justice Manuel Mendez granted an preliminary injunction against daily fantasy sports companies FanDuel and Draftkings. Both companies will have to halt all business in New York state.

Since the beginning of the NFL season, daily fantasy giants FanDuel and Draftkings have been employing an aggressive advertising style. By blitzing  commercial air space and forging partnerships between major sports leagues, FanDuel and Draftkings have drawn a hefty amount of attention to themselves. In November the Attorney General of New York Eric Schneiderman, set his sights on bringing down the multi-billion dollar companies within the Empire State, and now it seems that the first major shot has been fired.

On Friday, New York Supreme Court Justice Manuel Mendez ruled in favor of Schneiderman, stating that the websites were operating  illegally in regards to New York’s penal law. An injunction against Draftkings and FanDuel has been levied, which means both companies are barred from accepting entry fees, “wagers or bets”, per Forbes. Mendez’s ruling stems from the interpretation of section 225.00[1] of the New York gambling law,  which defines:

"“Contest of Chance” to mean, “. . . any contest, game, gaming scheme, or gaming device in which the outcome depends in a material degree upon an element of chance, notwithstanding that skill of the contestants may also be a factor therein.”"

The major argument at the moment, depends on whether or not these daily fantasy contests are seen more as games of skill or chance. Right now it seems that Justice Mendez believes that there are far too many factors outside of the players control, for daily fantasy to based more upon skill rather than chance.

Both the attorneys of FanDuel and Draftkings are planning on appealing this decision. as Both companies will seek to drum up enough evidence in order to deny the motion for injunction. FanDuel and Draftkings may continue their business on a nationwide scale but must cease all operations in New York for the time being. This will of course start a domino effect across the country, as there are eight other states with gambling regulations similar to New York’s, according to Reuters.