What now for DFS after Nevada rules it to be 'gambling'?

What now for DFS after Nevada rules it to be 'gambling'?

Friday, October 16, 2015 Totally Gaming

FanDuel said it is “examining all options” after being forced to cease its operations in Nevada following the US state’s ruling that daily fantasy sports (DFS) games are ‘gambling’.

The Nevada Gaming Control Board (NGCB) told operators such as FanDuel and DraftKings that they must apply for a state gaming license to operate a sports pool, thus opposing the sector’s claim that its games fall under the definition of ‘games of skill’ as defined by the Unlawful Internet Gambling Enforcement Act (UIGEA) 2006.

NGCB chairman A.G. Burnett said Nevada sports book operators could offer DFS, however the existence of a sector that has more than 50 million active players would be under threat should other states where gambling is not legal follow Nevada’s lead.

In response, FanDuel said: “On behalf of our users in Nevada, FanDuel is terribly disappointed that the NGCB has decided that only incumbent Nevada casinos may offer fantasy sports.

“This decision stymies innovation and ignores the fact that fantasy sports is a skill-based entertainment product loved and played by millions of sports fans. This decision deprives these fans of a product that has been embraced broadly by the sports community including professional sports teams, leagues and media partners.

“We are examining all options and will exhaust all efforts to bring the fun, challenge and excitement of fantasy sports back to our Nevada fans.  In the interim, because we are committed to ensuring we are compliant in all jurisdictions, regrettably, we are forced to cease operations in Nevada.”

Last month, TotallyGaming.com reported that Rep Frank Pallone had called for a congressional hearing “examining the relationship between professional sports and fantasy sports to review the legal status of fantasy sports and sports betting”.

While the major DFS operators could apply for a gambling licence in Nevada – after all, DraftKings has such a permit in the UK – that could be considered a risky venture considering they are claiming to not be gambling operators in other jurisdictions. Nevada is the US’s biggest land-based gambling zone but, in considering legal online turnover, it has just 2.8 million residents – 0.8 per cent of the country’s total population.

DraftKings - which states on its website that "daily fantasy sports is a skill game and is not considered gambling" - suggested that Nevada’s decision was related to parochial support of its gaming industry.

The company said: “We understand that the gaming industry is important to Nevada and, for that reason, they are taking this exclusionary approach against the increasingly popular fantasy sports industry.

“We strongly disagree with this decision and will work diligently to ensure Nevadans have the right to participate in what we strongly believe is legal entertainment that millions of Americans enjoy.”

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