Fansided

5 things to know about Daniels vs. FanDuel

By Derek Helling

A sign hangs on the wall in the reception area at Fanduel Inc.'s offices in Edinburgh, U.K., on Tuesday, Feb. 7, 2017. More coders are choosing to live in Edinburgh over London, according to a report by developer community Stack Overflow, reported the Scotsman in Dec. 2017. Photographer: Chris Ratcliffe/Bloomberg via Getty Images
A sign hangs on the wall in the reception area at Fanduel Inc.'s offices in Edinburgh, U.K., on Tuesday, Feb. 7, 2017. More coders are choosing to live in Edinburgh over London, according to a report by developer community Stack Overflow, reported the Scotsman in Dec. 2017. Photographer: Chris Ratcliffe/Bloomberg via Getty Images /
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A lawsuit involving former professional athletes, the First Amendment and daily fantasy sports giants DraftKings and FanDuel could have serious implications for DFS players.

A question about a lawsuit currently before the state of Indiana’s Supreme Court could make the cost of playing fantasy sports in the state – and others – more expensive if it is successful.

Here are five things to know about Daniels vs. FanDuel.

1. The lawsuit was brought against DraftKings and FanDuel by three former college American football players.

In May 2016, Akeem Daniels, Cameron Stingily and Nicholas Stoner filed their suit against the DFS operators alleging that under Indiana law DraftKings and FanDuel had infringed upon their rights of publicity by using their names and likenesses without written permission. Daniels and Stingily played American football at Northern Illinois and Stoner did the same at Indiana. They sought $5 million in damages.

In Sept. 2017, the district court granted a motion by FanDuel to dismiss the case. The plaintiffs appealed the case to the Indiana 7th Circuit, which has asked the state’s Supreme Court for clarification of whether the First Amendment to the US Constitution protects the DFS game operators using athletes images, likenesses and names or whether such usage violates state law.

2. All the major professional players’ unions have weighed in on the case in support of the plaintiffs.

On Thursday, the MLBPA, MLSPA, NBAPA, NFLPA, NHLPA, the USWNTPA and the WNBAPA all filed a brief with the state Supreme Court arguing that the First Amendment does not protect such usage of players’ NILs and that such usage does violate Indiana’s state laws.

If the Supreme Court does direct the appeals court that in its opinion, such usage does indeed violate Indiana law, that would greatly enhance the chances of victory for the plaintiffs. Conversely, if the Supreme Court deems such usage is protected by the First Amendment, that makes victory for the defendants more likely.

3. Even if the Supreme Court produces an interpretation favorable to the plaintiffs, this case may still not have significant ramifications for the DFS industry in Indiana.

In this case, like in any civil lawsuit, a settlement is always a possibility. The filing of the amicus brief by the PAs enhances the likelihood of DraftKings and FanDuel offering the plaintiffs a settlement, as would the Supreme Court determining that their usage of athletes’ NILs violates Indiana law.

One of the reasons why Indiana was likely chosen for this suit is because the state has one of the broadest and sweeping rights of publicity laws in the nation. Put more simply, if this case had a chance to succeed in any state, Indiana represented the best opportunity.

It’s ultimately the job of the plaintiffs’ lawyers to get them the best deal possible. If a settlement represents that, it’s likely they will settle.

4. If the plaintiffs win this trial, it could change how DraftKings and FanDuel operate in Indiana.

If this lawsuit is successful, DraftKings and FanDuel would be barred from using athletes’ images, likenesses and names in their fantasy games without written consent from those players. That’s not necessarily difficult to get, especially for corporations which already have such close ties to these leagues. All it would require is for them to purchase new licenses from the several PAs whose games the fantasy games are based upon.

That would represent a new cost to DraftKings and FanDuel in terms of operating in Indiana, however. DraftKings and FanDuel would have to re-evaluate whether it worth the cost of operating games in the state and if so, how to negotiate that new expense. It’s possible that part of the cost could get passed on to the end consumer.

5. If the plaintiffs win this trial, it could prompt similar lawsuits by athletes in other states with laws similar to Indiana.

Most states have right of publicity laws on the books, though some aren’t as broad as Indiana’s. Regardless, a victory in this case by the plaintiffs would set a precedent that athletes in other states could make arguments on in courts in other states.

DraftKings and FanDuel could avoid those cases by purchasing licenses from the PAs, and that’s probably the most likely reaction to a defeat in this lawsuit. It’s worth speculating in that scenario whether or not costs for DFS players in all states where it’s currently legal would go up.

Next: Each State's Sports Mt Rushmore

Right now everything hinges on the interpretation of Indiana law by the state’s Supreme Court. When that decision is made, the future of DFS in Indiana and around the United States can become more concrete.