State Of New York Vs Draftkings And Fanduel - 2314 Words

State of New York vs DraftKings and FanDuel Introduction Since the inception of fantasy sports companies, very few industries have grown this significantly in such a short time span. Since the surge in popularity of daily fantasy betting FanDuel and DraftKings have launched aggressive efforts to expand in order to reach the 51 million current fantasy sports users in the US and Canada alone. Although approximately 38% of Americans admitted to betting on sports in 2008, fantasy sports companies are also experiencing increased scrutiny from state regulators. Criticism stems from the belief that daily fantasy sports betting is considered to be online gambling and therefore should be illegal or heavily regulated at the state level. Multiple†¦show more content†¦FanDuel and DraftKings specialize in allowing clients to select sports teams or players to place in a lineup. Contestants then pay a participation fee to compete with other customers in order to win a large prize. The fantasy sports providers make a profit by taking a 9% margin of initial fees collected from costumers and awarding the rest of the funds to the winners. Although the federal government does not consider the activities of fantasy sports betting as gambling, 11 states currently deem it illegal and 20 more states are currently evaluating the legality of daily fantasy betting. The significance of this case stems from the fact that New York state is the largest market for both FanDuel and DraftKings. With 600,000 customers in the state and $200 million in entry fees last year alone, both daily fantasy companies are extremely vested in winning this case and have appealed the injunction. Daily fantasy sports companies argue that the attorney general hasn’t properly evaluated the assertion that fantasy betting requires a material degree of skill rather than luck. Legal Case Arguments Based on the attorney general’s accusations, the verdict of the ongoing case will largely be determined by the definition of gambling in the state of New York Law and whether the service provided by Draftkings and FanDuel constitute gambling. According to New York Penal Law 225.00: â€Å"A person engages in gambling when he stakes or risks