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New York State lawmakers vote to legalize fantasy sports

Insider BuzzInsider Buzz: New York State lawmakers vote to legalize fantasy sports
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ALBANY, N.Y. — Months after being halted by the New York attorney general, daily fantasy sports won a major victory early Saturday as state lawmakers moved to legalize the online games.

Gov. Andrew M. Cuomo, a Democrat, has not yet indicated that he will sign the bill, but the final legislation included proposed modifications from his staff, suggesting at least some degree of support.

Eric T. Schneiderman, the attorney general who first declared war on the industry last fall, declaring fantasy sports to be illegal gambling, had laid the groundwork for a deal in March when he suggested a June 30 deadline for the Legislature to act to address the games' legal status.

Mr. Schneiderman was neutral on the Legislature's action on Saturday, calling it "a law that it will be my job to enforce and defend," but he added that his office would continue to pursue claims against DraftKings and FanDuel, the industry's two biggest companies, over allegations of consumer fraud and false advertising.

The businesses' legislative backers in New York have insisted that fantasy sports is not gambling, which is mostly barred by the state's Constitution,but rather is "based upon the skill and knowledge of the participants." Indeed, the widely advertised games — in which players create imaginary teams using real players and win or lose depending on the players' statistics — would be classified as games of skill, not chance, a distinction under a 2006 federal law governing online wagering.

Under the deal agreed to by lawmakers, highly skilled and high-volume players will have to be clearly identified on the sites, a provision intended to protect casual players from being targeted and taken advantage of by more sophisticated players, something that some class-action suits have alleged takes place and that law enforcement has investigated.

Companies will pay the state the equivalent of 15.5 percent of their revenue to operate, an amount that supporters have estimated to be nearly $6 million a year. Funds collected by the state would be directed to an education fund run by the state lottery.

The battle over daily fantasy sports has been fought hard in Albany, the state capital, culminating in a protracted wait — stretching past midnight — as supporters of the legislation cemented enough support for the bill to pass the State Senate. It had passed the State Assembly on earlier Friday.

The New York deal is a lifeline for an industry so battered that its two major players, FanDuel and DraftKings, once bitter rivals, are in merger talks, according to two people familiar with the negotiations. Both companies declined to comment about the talks.

New York had more than 10 percent of the nation's daily fantasy players at the time the businesses were barred by the state, and the companies' bottom lines have taken a beating since they pulled out under the March agreement with Mr. Schneiderman.

"There have been meaningful reductions as well as difficulty raising capital," said Adam Krejcik of Eilers & Krejcik Gaming, a financial research firm that covers fantasy sports.

He added that "the hope is New York could serve as proxy or benchmark" as to how attorneys general and legislators proceed.

When DraftKings and FanDuel blitzed broadcasts with hundreds of millions of dollars in commercials last fall at the beginning of the N.F.L. season, daily fantasy sports appeared to be a virtual cash machine. Each company was valued at more than $1 billion, and their investors included Major League Baseball, the N.B.A., and the N.F.L. owners Jerry Jones and Robert K. Kraft, as well as major media companies like NBC.

New York is the eighth and most important market to pass legislation legalizing the games, which are under scrutiny in other player-rich states, such as Illinois, Florida and Texas.

"The lobbying and litigation expenses show no signs of abating," said Dan Wallach, a gaming and sports lawyer at the commercial law firm Becker & Poliakoff, adding that while more than two dozen states had introduced daily fantasy sports legislation, only a handful had passed laws. "How many more years of this can both companies withstand?"

Such concerns did not seem to affect the enthusiasm of State Senator John J. Bonacic, the chairman of the Racing, Gaming and Wagering Committee.

"Football season is around the corner," Mr. Bonacic said. "We're going to make a lot of football fans very happy."

NY Times

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9 comments. Last comment 7 months ago by Tatototman65.
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South Carolina
United States
Member #18322
July 9, 2005
1744 Posts
Offline
Posted: June 18, 2016, 5:49 pm - IP Logged

Months after being halted by the New York attorney general, daily fantasy sports won a major victory early Saturday as state lawmakers moved to legalize the online games.

Gov. Andrew M. Cuomo, a Democrat, has not yet indicated that he will sign the bill, but the final legislation included proposed modifications from his staff, suggesting at least some degree of support.

Eric T. Schneiderman, the attorney general who first declared war on the industry last fall, declaring fantasy sports to be illegal gambling, had laid the groundwork for a deal in March when he suggested a June 30 deadline for the Legislature to act to address the games' legal status.

Mr. Schneiderman was neutral on the Legislature's action on Saturday, calling it "a law that it will be my job to enforce and defend," but he added that his office would continue to pursue claims against DraftKings and FanDuel, the industry's two biggest companies, over allegations of consumer fraud and false advertising.

The businesses' legislative backers in New York have insisted that fantasy sports is not gambling, which is mostly barred by the state's Constitution,but rather is "based upon the skill and knowledge of the participants." Indeed, the widely advertised games — in which players create imaginary teams using real players and win or lose depending on the players' statistics — would be classified as games of skill, not chance, a distinction under a 2006 federal law governing online wagering.

Under the deal agreed to by lawmakers, highly skilled and high-volume players will have to be clearly identified on the sites, a provision intended to protect casual players from being targeted and taken advantage of by more sophisticated players, something that some class-action suits have alleged takes place and that law enforcement has investigated.

Companies will pay the state the equivalent of 15.5 percent of their revenue to operate, an amount that supporters have estimated to be nearly $6 million a year. Funds collected by the state would be directed to an education fund run by the state lottery.

The battle over daily fantasy sports has been fought hard in Albany, the state capital, culminating in a protracted wait — stretching past midnight — as supporters of the legislation cemented enough support for the bill to pass the State Senate. It had passed the State Assembly on earlier Friday.

The New York deal is a lifeline for an industry so battered that its two major players, FanDuel and DraftKings, once bitter rivals, are in merger talks, according to two people familiar with the negotiations. Both companies declined to comment about the talks.

New York had more than 10 percent of the nation's daily fantasy players at the time the businesses were barred by the state, and the companies' bottom lines have taken a beating since they pulled out under the March agreement with Mr. Schneiderman.

"There have been meaningful reductions as well as difficulty raising capital," said Adam Krejcik of Eilers & Krejcik Gaming, a financial research firm that covers fantasy sports.

He added that "the hope is New York could serve as proxy or benchmark" as to how attorneys general and legislators proceed.

When DraftKings and FanDuel blitzed broadcasts with hundreds of millions of dollars in commercials last fall at the beginning of the N.F.L. season, daily fantasy sports appeared to be a virtual cash machine. Each company was valued at more than $1 billion, and their investors included Major League Baseball, the N.B.A., and the N.F.L. owners Jerry Jones and Robert K. Kraft, as well as major media companies like NBC.

New York is the eighth and most important market to pass legislation legalizing the games, which are under scrutiny in other player-rich states, such as Illinois, Florida and Texas.

"The lobbying and litigation expenses show no signs of abating," said Dan Wallach, a gaming and sports lawyer at the commercial law firm Becker & Poliakoff, adding that while more than two dozen states had introduced daily fantasy sports legislation, only a handful had passed laws. "How many more years of this can both companies withstand?"

Such concerns did not seem to affect the enthusiasm of State Senator John J. Bonacic, the chairman of the Racing, Gaming and Wagering Committee.

"Football season is around the corner," Mr. Bonacic said. "We're going to make a lot of football fans very happy."

How exactly do you play a Fantasy Sport Football game ??  Do you join with other online players to create 2 imaginary teams, and then do you play the game like an online roll playing game, which players place $$$ wagers on ???

    TheMeatman2005's avatar - lightening
    Brooklyn, NY
    United States
    Member #169723
    October 29, 2015
    887 Posts
    Offline
    Posted: June 18, 2016, 6:15 pm - IP Logged

    Whether you use real teams or made-up ones, if there's money bet, it's gambling!

    The Meatman

    “The quickest way to double your money is to fold it in half and put it in your back pocket.” Will Rogers

    Winning happens in a flash, Like A Bolt Of Lightning!  Patriot

      LiveInGreenBay's avatar - driver
      Green Bay
      United States
      Member #169391
      October 15, 2015
      1280 Posts
      Offline
      Posted: June 18, 2016, 7:07 pm - IP Logged

      I wonder if we can't start a fantasy lottery game.  A game where everyone hits the jackpot!

      Never give up.  Banana

        TheMeatman2005's avatar - lightening
        Brooklyn, NY
        United States
        Member #169723
        October 29, 2015
        887 Posts
        Offline
        Posted: June 18, 2016, 7:36 pm - IP Logged

        I wonder if we can't start a fantasy lottery game.  A game where everyone hits the jackpot!

        You're too late Green Bay...Eddie Tipton came up with that idea first.

        Good idea though.

        ROFL

        The Meatman

        “The quickest way to double your money is to fold it in half and put it in your back pocket.” Will Rogers

        Winning happens in a flash, Like A Bolt Of Lightning!  Patriot

          Coin Toss's avatar - shape barbed.jpg
          Zeta Reticuli Star System
          United States
          Member #30470
          January 17, 2006
          10392 Posts
          Offline
          Posted: June 18, 2016, 7:51 pm - IP Logged

          destinycreation.

          From the OP:

          "Indeed, the widely advertised games — in which players create imaginary teams using real players and win or lose depending on the players' statistics —"

          It's al about statistics.

          Those who run the lotteries love it when players look for consistency in something that's designed not to have any.

          Lep

          There is one and only one 'proven' system, and that is to book the action. No matter the game, let the players pick their own losers.

            Bondi Junction
            Australia
            Member #57242
            December 24, 2007
            1102 Posts
            Offline
            Posted: June 19, 2016, 7:46 am - IP Logged

            Months after being halted by the New York attorney general, daily fantasy sports won a major victory early Saturday as state lawmakers moved to legalize the online games.

            Gov. Andrew M. Cuomo, a Democrat, has not yet indicated that he will sign the bill, but the final legislation included proposed modifications from his staff, suggesting at least some degree of support.

            Eric T. Schneiderman, the attorney general who first declared war on the industry last fall, declaring fantasy sports to be illegal gambling, had laid the groundwork for a deal in March when he suggested a June 30 deadline for the Legislature to act to address the games' legal status.

            Mr. Schneiderman was neutral on the Legislature's action on Saturday, calling it "a law that it will be my job to enforce and defend," but he added that his office would continue to pursue claims against DraftKings and FanDuel, the industry's two biggest companies, over allegations of consumer fraud and false advertising.

            The businesses' legislative backers in New York have insisted that fantasy sports is not gambling, which is mostly barred by the state's Constitution,but rather is "based upon the skill and knowledge of the participants." Indeed, the widely advertised games — in which players create imaginary teams using real players and win or lose depending on the players' statistics — would be classified as games of skill, not chance, a distinction under a 2006 federal law governing online wagering.

            Under the deal agreed to by lawmakers, highly skilled and high-volume players will have to be clearly identified on the sites, a provision intended to protect casual players from being targeted and taken advantage of by more sophisticated players, something that some class-action suits have alleged takes place and that law enforcement has investigated.

            Companies will pay the state the equivalent of 15.5 percent of their revenue to operate, an amount that supporters have estimated to be nearly $6 million a year. Funds collected by the state would be directed to an education fund run by the state lottery.

            The battle over daily fantasy sports has been fought hard in Albany, the state capital, culminating in a protracted wait — stretching past midnight — as supporters of the legislation cemented enough support for the bill to pass the State Senate. It had passed the State Assembly on earlier Friday.

            The New York deal is a lifeline for an industry so battered that its two major players, FanDuel and DraftKings, once bitter rivals, are in merger talks, according to two people familiar with the negotiations. Both companies declined to comment about the talks.

            New York had more than 10 percent of the nation's daily fantasy players at the time the businesses were barred by the state, and the companies' bottom lines have taken a beating since they pulled out under the March agreement with Mr. Schneiderman.

            "There have been meaningful reductions as well as difficulty raising capital," said Adam Krejcik of Eilers & Krejcik Gaming, a financial research firm that covers fantasy sports.

            He added that "the hope is New York could serve as proxy or benchmark" as to how attorneys general and legislators proceed.

            When DraftKings and FanDuel blitzed broadcasts with hundreds of millions of dollars in commercials last fall at the beginning of the N.F.L. season, daily fantasy sports appeared to be a virtual cash machine. Each company was valued at more than $1 billion, and their investors included Major League Baseball, the N.B.A., and the N.F.L. owners Jerry Jones and Robert K. Kraft, as well as major media companies like NBC.

            New York is the eighth and most important market to pass legislation legalizing the games, which are under scrutiny in other player-rich states, such as Illinois, Florida and Texas.

            "The lobbying and litigation expenses show no signs of abating," said Dan Wallach, a gaming and sports lawyer at the commercial law firm Becker & Poliakoff, adding that while more than two dozen states had introduced daily fantasy sports legislation, only a handful had passed laws. "How many more years of this can both companies withstand?"

            Such concerns did not seem to affect the enthusiasm of State Senator John J. Bonacic, the chairman of the Racing, Gaming and Wagering Committee.

            "Football season is around the corner," Mr. Bonacic said. "We're going to make a lot of football fans very happy."

            Next they should legislate to give winners the option to remain anonymous. It can be very dangerous to require winners to be publicly identified.

            We all get a lot out of lotteries!

              jimjwright's avatar - Yellow 3.png
              Park City, UT
              United States
              Member #69864
              January 18, 2009
              995 Posts
              Offline
              Posted: June 19, 2016, 10:18 am - IP Logged

              The real money to be made in daily fantasy sports games for the experienced player is playing the heads up or 50/50 Double up games.  I play these games exclusively on baseball and basketball using software I wrote.

              Jimmy

                sully16's avatar - sharan
                Ringleader
                Michigan
                United States
                Member #81740
                October 28, 2009
                42186 Posts
                Online
                Posted: June 20, 2016, 9:09 am - IP Logged

                The real money to be made in daily fantasy sports games for the experienced player is playing the heads up or 50/50 Double up games.  I play these games exclusively on baseball and basketball using software I wrote.

                Jimmy

                That's cool, do you plan on writing some for Hockey?

                 HyperBe Happy.

                  Tatototman65's avatar - Lottery-009.jpg

                  United States
                  Member #138729
                  February 4, 2013
                  2875 Posts
                  Offline
                  Posted: June 23, 2016, 6:25 am - IP Logged

                  It's too bad NY couldn't also pass the online poker bill even when the senate passed it 53-5. #Fight4Poker

                  Smile