New York Judge Manuel Mendez granted the New York State Attorney General a preliminary injunction that bans DraftKings and FanDuel from operating in New York. Both sites will appeal, but for now daily fantasy sports (DFS) is gone from the Empire State.
As for legislative solutions, there’s an additional issue raised by attorney Daniel Wallach this morning: The Professional and Amateur Sports Protection Act of 1992. This act banned traditional sports betting in all but four states. Mr. Wallach believes that the law could be read to ban DFS, too:
Why PASPA applies to DFS: plain language of statute plus legislative history makes clear that it is intended to have broad application
— Daniel Wallach (@WALLACHLEGAL) December 11, 2015
This decision shouldn’t be a surprise, and I expect it to be upheld on appeal. (Note that I am not an attorney, so please don’t take what I write as legal advice.) As I wrote back in mid-November, I expect more states to ban DFS while some will move to explicitly allow it (by regulating it). Remember that the first instinct of any regulator is to ban anything that’s new. With DFS not only is that an issue, there’s also the dubious legality of it.
UPDATE: DraftKings and FanDuel filed appeals. Both sites received temporary stays against the original injunction until January 4th.
Tags: DFS