N.Y. AG: Daily Fantasy Sports Violate State Law; FanDuel and DraftKings Fight Back

On November 17th, New York State Attorney General Eric Schneiderman filed an enforcement action in New York State Supreme Court in the County of New York, seeking a preliminary injunction against DraftKings and FanDuel. Schneiderman argues that because daily fantasy sports (DFS) sites allow wagering based on one day’s outcomes and not an entire season, it is gambling and not a game of skill, and therefore is illegal in New York. New York State issued an enforcement action prohibiting the DFS sites from accepting wagers from its citizens.

The regulations governing the Unlawful Internet Gambling Enforcement Act (UIGEA) allow banks to block all customer payments for the purposes of online wagering whether it is lawful or not. For more information on bank obligations under UIGEA, see the ABA UIGEA Resource Page.

The Attorney General’s memorandum of law and complaint against DraftKings can be found here and here. A copy of the memorandum of law and complaint against FanDuel can be found here and here.