Illinois bans Daily Fantasy Sports | Draftkings Fanduel

Illinois Bans Draftkings & Fanduel

The Illinois Attorney General has decided that DraftKings and FanDuel are conducting illegal gambling operations in that state and wants the companies to shut down there unless and until the state legislature legalizes them.

The opinion was issued Wednesday by Illinois Attorney General Lisa Madigan, striking another gut punch to the daily fantasy sports industry after New York made a similar decision last month.

“Absent legislation specifically exempting daily fantasy sports contests from the gambling provisions, it is my opinion that daily fantasy sports contests constitute illegal gambling under Illinois law,” Madigan wrote.

Officials in Texas and California have been considering this issue, too, while New York has taken its case to court in an effort to shut them down.

FanDuel and DraftKings dominate the daily fantasy sports industry, a growing new business phenomenon in the digital age with high-profile partners and investors in pro sports and media, including the NBA, which owns a stake in FanDuel.

The companies have argued that they are games of skill and not chance like traditional gambling. They also cite a 2006 federal law that cracked down on online gambling but exempted paid fantasy sports games played under certain conditions.

That law, however, doesn’t give it protection from state laws that might prohibit such games.

Her opinion didn’t directly address the legality of traditional, season-long fantasy sports games, which also are played for money but are played over the course of a season instead of a day or a week. As FanDuel noted, her legal reasoning could apply to traditional fantasy sports games, too, possibly threatening a popular pastime that’s been around for decades.

By contrast, Schneiderman of New York distinguished between traditional fantasy sports and daily fantasy sports and only has tried to shut down the latter, declaring it to be illegal gambling. Traditional sports gambling is largely illegal in the U.S. outside of Nevada. But New York lawmakers also have indicated they might change the law there to protect fantasy sports.

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