Nearly a month after Nevada ruled daily fantasy sports games constituted gambling and were illegal in the state, New York followed suit Tuesday with a declaration from state Attorney General Eric T. Schneiderman.
According to the New York Times' Walt Bogdanich, Joe Drape and Jacqueline Williams, daily fantasy websites DraftKings and FanDuel were ordered "to stop accepting bets from New York residents," as the attorney general said "their games constituted illegal gambling under state law."
On Wednesday, FanDuel CEO Nigel Eccles said he plans to fight the attorney general's decision, per ESPN's Darren Rovell. "We are going to use every avenue to stay open," said Eccles.
The legality of daily fantasy sports has come under scrutiny in recent months following an explosion of activity within the industry, and a primary point of contention has revolved around a loophole in the Unlawful Internet Gambling Enforcement Act of 2006.
McCollum and the Blazers Snapped Postseason Losing Streak for "Jennifer"
Spencer Is the Real Winner of the Boston Marathon
Stars Invest in Plant-Based Food as Vegetarianism Sweeps NBA
The NBA Got Some Wild Techs This Season
Jarrett Allen Is One of the NBA’s Hottest Rim Protectors
Wade's Jersey Swaps Created Epic Moments This Season
NBA Squads Brought the Heat with Bench Reactions This Year
Westbrook Makes History While Honoring Nipsey Hussle
Nation’s Top-Ranked H.S. Teams Will Play for a National Title
Is 20-Year-Old Undefeated Ryan Garcia Boxing's Next Superstar?
Devin Booker Makes History with Scoring Tear
29 Years Ago, Jordan Dropped Career-High 69 Points
MLB Players Are Getting Wild Inspiration for Their Cuts
Bosh Is Getting His Jersey Raised to the Rafters in Miami
Carsen Edwards Put on a Show vs. the Defending Champs
Gabe Kalscheur Is Early Breakout Star of March Madness
Barrett, Brazdeikis Lead Canadian Hoops Revolution to March Madness
UM's Ignas Brazdeikis Is the Villain of March Madness
OBJ's Trade to Cleveland Has the Browns Hyped
Steph Returns to Houston for 1st Time Since His Moon Landing Troll
Games of skill were exempt from the legislation, and as a result, daily fantasy websites have been clear to operate freely within the confines of the law. However, states like New York and Nevada have challenged the law recently by banning bets and investigating the games as gambling.
"Fantasy sports is a game of skill and legal under New York state law," FanDuel said in a statement, according to the New York Times. "This is a politician telling hundreds of thousands of New Yorkers they are not allowed to play a game they love and share with friends, family, co-workers and players across the country."
Similarly, DraftKings spokeswoman Sabrina Macias released a statement, saying, "We’re disappointed he hasn’t taken the time to meet with us or ask any questions about our business model before his opinion," according to the New York Times.
The daily fantasy industry has also been in the crosshairs of the FBI after a DraftKings employee was investigated following allegations of possible insider trading. Drape and Williams reported on Oct. 14 that an employee "admitted to inadvertently releasing data before lineups for the start of the third week of NFL games were locked in."
The employee in question, Ethan Haskell, won $350,000 on FanDuel that week but was later cleared of wrongdoing, per Drape, after an outside law firm concluded he did not use the lineup information to his advantage.