Judge Orders DraftKings and FanDuel To Cease Doing Business in NY State

[TheGardener]

NEW YORK — Daily fantasy sports giants DraftKings and FanDuel were ordered Friday to stop operating in New York, dealing a severe blow that is likely to reverberate across the industry.

https://www.washingtonpost.com/news/business/wp/2015/12/11/draftkings-fanduel-lose-big-ordered-to-shut-down-in-new-york/?hpid=hp_hp-more-top-stories_draftkings_1055am%3Ahomepage%2Fstory

If you have ever watch one of their commercials, and how could you not, their business is clearly gambling. Today a NY state judge confirmed that the NY AG is right. How the companies could testify that it is a game of skill and not be found guilty of perjury is beyond me. Here are a few commercials.

https://www.youtube.com/watch?v=Y9QpSkwr878

https://www.youtube.com/watch?v=pnvTXsqLxoE

https://www.youtube.com/watch?v=p2lmIY8YE2U

Great Parody Commercial

https://www.youtube.com/watch?v=Xh-jygzzmK4

Does this news upset you? Other states may start banning them as well.

 

[SunnyD]

I don't know why this is a big deal. They already have been ordered to stop doing business in several other states, particularly Nevada (should come as no surprise there).

 

[GagHalfrunt]

Technically, it most definitely is a game of skill. Something like 95% of the money is won by 1.5% of the players. It's serious computer geeks who have written their own custom algorithms cleaning up on a bunch of fish.

But they're in a catch-22 situation because if their defense is that only a small percentage of skillful players have a chance and everyone else is throwing money away against professional fantasy nerds it doesn't really help them.

 

[CraKaJaX]

Does this mean I'll finally not have to see their commercials every 2 minutes?

 

[SunnyD]

Technically, it most definitely is a game of skill. Something like 95% of the money is won by 1.5% of the players. It's serious computer geeks who have written their own custom algorithms cleaning up on a bunch of fish.

But they're in a catch-22 situation because if their defense is that only a small percentage of skillful players have a chance and everyone else is throwing money away against professional fantasy nerds it doesn't really help them.

I haven't played the daily fantasy sites at all, but if they follow the standard fantasy leagues in any form they are just as much a game of chance, or a lottery if you will as one could consider them a game of skill.

Even if they don't follow the same format, is essentially is a lottery and New York State's law is written as such that only the State of New York can administer lotteries within the state of New York.

Does this mean I'll finally not have to see their commercials every 2 minutes?

Yeah, I miss seeing the Viagra and Cialis commercials every 30 seconds instead.

 

[waggy]

I don't see how anyone can say it's not gambling. but meh if idiots want to throw away money

 

[CraKaJaX]

Yeah, I miss seeing the Viagra and Cialis commercials every 30 seconds instead.

My TV is on ESPN 99% of the time I'm home. I don't necessarily watch it, but I can hear it.

"GO TO DRAFTKINGS NOW. ENTER PROMOTIONAL CODE: BEER. THAT'S.... BEER"

Among the other 78 "promotional codes" they have.

Where is the gun to the forehead emoji??????

 

[Stopsignhank]

Does this mean I'll finally not have to see their commercials every 2 minutes?

Exactly. I could not care less about these sites, I just got so sick about hearing how you could win $2,000,000 with only a $6 buy in. STFU!!

 

[TheGardener]

I don't know why this is a big deal. They already have been ordered to stop doing business in several other states, particularly Nevada (should come as no surprise there).

Interesting. Though I've read a dozen articles about their doing business in NY and Mass, the local articles never mentioned that other states had already restricted their residents from playing. A search led me to a confirmation of what you stated. Some other states include Washington, Iowa, Louisiana and Arizona.

 

[TheGardener]

Does this mean I'll finally not have to see their commercials every 2 minutes?

Yes, but they will be filled by more Jeb Bush commercials.

 

[GagHalfrunt]

I haven't played the daily fantasy sites at all, but if they follow the standard fantasy leagues in any form they are just as much a game of chance, or a lottery if you will as one could consider them a game of skill.

Even if they don't follow the same format, is essentially is a lottery and New York State's law is written as such that only the State of New York can administer lotteries within the state of New York.

Is there a language barrier problem? They are not a game of chance, they are not anything even close to a lottery. They're like you playing golf against Jordan Spieth, Rory McIlroy and Bubba Watson at the same time with your own money on the line. You're betting, but you have no chance.

https://www.washingtonpost.com/news...-wont-win-money-playing-daily-fantasy-sports/

The top 1 percent of players, they found, paid 40 percent of the entry fees but reaped 91 percent of the profits.

That is not a lottery.

 

[midwestfisherman]

Is there a language barrier problem? They are not a game of chance, they are not anything even close to a lottery. They're like you playing golf against Jordan Spieth, Rory McIlroy and Bubba Watson at the same time with your own money on the line. You're betting, but you have no chance.

https://www.washingtonpost.com/news...-wont-win-money-playing-daily-fantasy-sports/

The top 1 percent of players, they found, paid 40 percent of the entry fees but reaped 91 percent of the profits.

That is not a lottery.

+1

 

[Brainonska511]

Is there a language barrier problem? They are not a game of chance, they are not anything even close to a lottery. They're like you playing golf against Jordan Spieth, Rory McIlroy and Bubba Watson at the same time with your own money on the line. You're betting, but you have no chance.

https://www.washingtonpost.com/news...-wont-win-money-playing-daily-fantasy-sports/

The top 1 percent of players, they found, paid 40 percent of the entry fees but reaped 91 percent of the profits.

That is not a lottery.

Under NYS law, things like poker and daily fantasy are still gambling.

"A person engages in gambling when he stakes or risks something of value upon the outcome of a contest of chance or a future contingent event not under his control or influence, upon an agreement or understanding that he will receive something of value in the event of a certain outcome."
N.Y. Penal Law §§ 225.00-225.40

From the NYAG's initial cease & desist letter to FanDuel:
"[E]xcept as hereinafter provided, no lottery or the sale of lottery tickets, pool-selling, book-making, or any other kind of gambling, except lotteries operated by the state . . ., except pari-mutuel betting on horse races . . . , and except casino gambling at no more than seven facilities. . . shall hereafter be authorized or allowed within this state; and the legislature shall pass appropriate laws to prevent offenses against any of the provisions of this section.
N.Y. Const. Art. I, § 9 (emphasis added)."

 

[TheGardener]

Is there a language barrier problem? ... That is not a lottery.

The NY AG disagrees, as does the state judge.

 

[kranky]

Technically, it most definitely is a game of skill. Something like 95% of the money is won by 1.5% of the players. It's serious computer geeks who have written their own custom algorithms cleaning up on a bunch of fish.

But they're in a catch-22 situation because if their defense is that only a small percentage of skillful players have a chance and everyone else is throwing money away against professional fantasy nerds it doesn't really help them.

I don't really understand how the experts use algorithms to win nearly all the money, but knowing that should be enough to keep Joe Sixpack from playing. I guess you'd narrow down the picks to 2-3 in each category, then play every combination. Probably would win something unless every top player in the league gets injured in the first quarter.

If that's the concept, could the companies spread out the money across more winners by introducing more "things" to select for each entry? In other words, if you have to select 30 things (players/teams/etc) per entry, it would make it a heck of a lot more expensive to play every combo of the top 2-3 in each category. But that would probably turn off a lot of people.

 

[kstu]

Is there a luck component, absolutely. Is there a skill component, absolutely. Let people do what they want with their money.

 

[Linflas]

NY's major issue with it is that it is not state run gambling like the lottery and OTB.

 

[Blackjack200]

I don't really understand how the experts use algorithms to win nearly all the money, but knowing that should be enough to keep Joe Sixpack from playing. I guess you'd narrow down the picks to 2-3 in each category, then play every combination. Probably would win something unless every top player in the league gets injured in the first quarter.

If that's the concept, could the companies spread out the money across more winners by introducing more "things" to select for each entry? In other words, if you have to select 30 things (players/teams/etc) per entry, it would make it a heck of a lot more expensive to play every combo of the top 2-3 in each category. But that would probably turn off a lot of people.

My guess based on my limited understanding of this industry:

You "bid" on players to draft them, and you get a certain budget with which to bid and build out your team. Now, say that 99% of fantasy football players bid on and draft Tom Brady. Also 99% draft Odell Beckham Jr. If those two players perform well, the pot will not be very rich since it will be split.

So the secret sauce of these leagues is to draft good players that are not being drafted by everyone else. Maybe these algorithms help the players figure out will not be popular in a given day? Or they get some inside info?

 

[smackababy]

My guess based on my limited understanding of this industry:



You "bid" on players to draft them, and you get a certain budget with which to bid and build out your team. Now, say that 99% of fantasy football players bid on and draft Tom Brady. Also 99% draft Odell Beckham Jr. If those two players perform well, the pot will not be very rich since it will be split.



So the secret sauce of these leagues is to draft good players that are not being drafted by everyone else. Maybe these algorithms help the players figure out will not be popular in a given day? Or they get some inside info?

This. And this is why thy got in hot water. People actively working at the company had access to the data of current daily picks AND could enter. With said data, one could easily increase the reward beyond the expected value of the entree. The "nerds" that do this crunch numbers of previous released weeks and guesstimate potential "sleeper" picks to maximize their results.

And, it is gambling. How you can think it is any more of a game of skill than say horse and dog racing is just you being a moron. You can research everything about a horse, jockey, and trainer and it is still gambling.

 

[GagHalfrunt]

The NY AG disagrees, as does the state judge.

No, but they all agree that you can't read or think. It's not being banned because it's a lottery, it's being banned because it's gambling. Although both are illegal under NY laws they're completely different things. If you truly don't understand the difference between a lottery and a game of skill then you need professional help.

 

[LikeLinus]

Good for NYC. It's straight up gambling and their name and commercials are everywhere. Can't watch sports without their crap.

 

[kstu]

All of you talking about horse racing, gambling, etc. realize that those things are completely legal in NYS right? In the case of DK and FanDuel they just don't get to take their cut of the revenue on top of the taxable income. It's hypocrisy at it's finest.

 

[smackababy]

No, but they all agree that you can't read or think. It's not being banned because it's a lottery, it's being banned because it's gambling. Although both are illegal under NY laws they're completely different things. If you truly don't understand the difference between a lottery and a game of skill then you need professional help.

Again, fantasy football is equal in skill to something like horse racing and blackjack. While it does require some amount of skill, the amount of luck involved is significantly more than other forms of illegal gambling, such as poker.

 

[lxskllr]

All of you talking about horse racing, gambling, etc. realize that those things are completely legal in NYS right? In the case of DK and FanDuel they just don't get to take their cut of the revenue on top of the taxable income. It's hypocrisy at it's finest.

Yup. If the government vultures don't get some(the majority) of the carcass, it's illegal. I think they take an 80%(!) cut of casino gambling in MD. That means players(especially of slots) are getting screwed more than they otherwise would. When a middleman that provides nothing takes a majority share, it's less money that can go to players.

 

[Theb]

I'm not sure why online poker was banned, but these sites are able to stay online.