“Regardless, our claims against the companies for false advertising and consumer fraud are not affected by the agreement and will continue”.
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In statements, spokespeople for both companies said they would seek to clarify state law to allow their ny customers to play without ambiguity.
They had been allowed to operate while they appealed an injunction.
He added that the deal with the two companies will create room to resolve the issue in court of whether their fantasy sports competitions are legal or whether they need a change in the law to become so. According to the Legal Sports Report, the most promising bill is now in the state Senate, and among other provisions levies a 15% tax on daily fantasy revenue, bans horse racing or college sports contests, and exempts daily fantasy from the gambling code.
Though the sites argue they are games of skill and Schneiderman says the leagues amount to gambling, since players are “placing bets on events outside of their control or influence”.
At a press conference Monday, Schneiderman said he is “hopeful” that other sites that run daily games will pull out of NY.
In a statement, FanDuel said: “We are announcing that as of today (Monday), FanDuel will cease offering paid contests in the state of NY per the terms of a settlement reached with the Attorney General on certain aspects of the ongoing litigation”.
The deal comes amid an effort by the attorney general to force the companies to stop accepting money from New Yorkers and pay restitution to contestants who lost money playing on the sites.
The sites can still offer New York-based customers free games. The sites had been using a 2006 law, which protects traditional fantasy sports, to get by. If a new law isn’t enacted, the state’s appeals court would rule on the legality of the contests this fall.
But Schneiderman disagreed and in November sent the companies cease-and-desist letters, arguing the businesses were essentially illegal gambling operations based on chance.
“FanDuel is headquartered in Manhattan, where we employ more than 170 smart, young, passionate fans who are dedicated to innovating and providing the best fantasy experience possible”.
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FanDuel said the decision to halt business in NY was “disheartening” but was in the “best interest of our company, the fantasy industry and our players while we continue to pursue legal clarity in NY”.
