Why FanDuel is agreeing to quit Texas

Why FanDuel is agreeing to quit Texas

Monday, March 7, 2016 Totally Gaming
The daily fantasy sports operator will stop offering real money contests in May

A chasm has developed between daily fantasy sports (DFS) giants FanDuel and DraftKings after the former agreed a deal to cease offering its real money contests in Texas in May.

While DraftKings is currently suing Texas Attorney General Ken Paxton - who declared in January that DFS is illegal in the US’s second most populous state - to continue its operations there, FanDuel announced on Friday it will stop accepting entry fees from May 1.

The New York-based company said it will push for legislation in Texas next year that will allow the company to return.

Texas becomes the ninth state in which FanDuel will not offer its paid contests because of state gambling laws, not including New York and Illinois, where it continues to operate while it fights for its survival in court.

“We believe FanDuel has always been legal in Texas and strongly disagree with the recent advisory opinion of the Attorney General, but understand that the laws surrounding fantasy sports require clarity,” FanDuel said in a statement.

“As such, we have worked with the Texas Attorney General to map out our plan to wind down our operations in Texas, suspending paid contests on May 1st. The Texas legislature will be in session in 2017 and we will work to pass legislation that protects fantasy sports and consumers so that we can bring our paid contests back to Texans as soon as possible.”

In its suit, DraftKings states that FanDuel's agreement with Texas "evidences the Attorney General’s intent to scuttle (daily fantasy sports) operators in the State of Texas, and illustrates the imminent harm that DraftKings could itself face without this Court’s intervention."

As in New York, DraftKings’ suit in Texas claims that DFS contests are “skill-based games and perfectly legal”.

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