Why DraftKings won’t be stopping New York operations

Why DraftKings won’t be stopping New York operations

Thursday, November 12, 2015 Totally Gaming
DraftKIngs described Eric Schneiderman's decision as "hasty and uninformed"

DraftKings is ready to battle for its estimated $100m (€93.3m) New York customer base after telling TotallyGaming.com that it intends to continue operating in the US state.

The daily fantasy sports (DFS) operator and rival FanDuel were told to cease trading in New York – believed to be 10 per cent of the sector’s market - by Attorney General Eric Schneiderman on Tuesday after an investigation found that both companies were effectively offering illegal gambling.

However, while DraftKings immediately stopped operating in Nevada after the state announced that gambling licences were required for DFS operators last month, a company spokesperson told TotallyGaming.com that Schneiderman acted without legal authority in New York and that the operator will fight the decision through international law firm Gibson, Dunn & Crutcher.

"By its plain terms, the Attorney General's letter, which was provided without notice, provides us five days to respond,” the spokesperson said. “Under applicable law, the Attorney General cannot and should not shut down daily fantasy sports through fiat and heavy-handed threats, without first seeking a court order."

FanDuel also said that it planned a legal challenge, with both companies still accepting entries from New York-based players.

The DraftKings spokesperson added: “We believe this was a hasty and uninformed decision by the New York Attorney General.

"Fortunately, there is a process by which DraftKings can challenge it in a court of law in an effort to prevent us from having to cease operations in the state of New York.

“We intend to pursue this fight to the fullest to ensure that hundreds of thousands of New York fantasy sports fans can continue to play the games they love.”

The Attorney General’s office, responding to DraftKings' legal opinion, told TotallyGaming.com that “we will file a lawsuit if the companies don’t cease and desist”.

The office also confirmed that it is only pursuing DraftKings and FanDuel among DFS operators at present. While Amaya-owned StarsDraft exited New York in October, Yahoo! does not include New York among the US states from which it will not accept cash players.

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