Daily fantasy sports operators suffered another big blow Tuesday when New York Attorney General Eric Schneiderman ruled that the industry has violated the state's gambling laws.
On Thursday, the Twitter account for FanDuel, one of the two largest daily fantasy web sites, protested the ruling by tweeting a message that compared its contests to basic American freedoms. The tweet didn't last long before the company deleted it.
New York was only the latest state to determine that daily fantasy sports constitute gambling, but in doing so, Schneiderman handed down "perhaps the most damning legal critique of daily fantasy sports to date," as Sports Illustrated legal analyst Michael McCann put it. It was a significant ruling for an industry that has been under siege from lawmakers and regulators since an "insider trading" scandal rocked it this fall.
The New York ruling sparked a visceral reaction in the daily fantasy community. Users are planning a protest outside Schneiderman's Manhattan office this weekend, according to a notice posted on Rotogrinders, a top fantasy sports forum. And FanDuel launched a petition drive this week aimed at lawmakers at the state and federal level, where Congress has considered holding hearings into the industry. Other web sites allow users to send letters to Schneiderman directly.
Neither DraftKings nor FanDuel, the two largest companies, has ceased taking wagers in New York yet. A DraftKings spokesperson indicated Wednesday that the company plans to challenge Schneiderman's ruling in court.
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