In a press release issued on Monday, South Dakota Attorney General Marty Jackley said that he would not be seeking felony indictments for the thousands of residents who bet on daily fantasy sports (DFS). Jackley is the fourth state attorney general to make a statement regarding the activity.
Jackley said due to the current state of uncertainty in the state regarding whether or not DFS is a game of chance and unlawful under state law, or a game based on skill, a clearer directive from the state legislature would be required before any action would be pursued. Other alternatives will continue to be considered, “including potential civil remedies and National Attorneys General joint action aimed at protecting the intent of our Constitutional and statutory provisions, according to the Attorney General.
However, on Monday The Associated Press was told by Governor Dennis Daugaard that he believes participating in DFS constitutes gambling under South Dakota Law. He said, “I think it’s no more a game of skill than blackjack is a game of skill, and so if blackjack’s a game of chance, then I believe fantasy football should be considered a game of chance as well.”
It is estimated that more than 25,000 residents of South Dakota participate in the contests each year, according to industry lobbyist Griffin Finan, who is DraftKings director of public affairs. Legislation to clarify that the contests are exempt from state oversight may be pursued by the industry, and also impose consumer protection safeguards on operators.
Finan spoke for the Fantasy Sports Trade Association in addition to FanDuel and DraftKings, the two DFS leaders which have been the focus of the New York attorney general’s office. Last month he told the Commission on Gaming that fantasy sports are predominantly skill-based, therefore legal in South Dakota. In a statement on Monday Finan said that he welcomes the decision by Jackley and that DraftKings looks forward to working with the Legislature and the attorney general.
Daily fantasy sports, where participants assemble a roster of real-life professional athletes to compete against others in online leagues, have been under microscope this year. Both industry leaders, DraftKings and FanDuel, spent millions on various forms of advertising in attempts to add casual sports fans to its customer base prior to the 2015 NFL season. Shortly after the season began an employee from DraftKings won $350,000 playing in a contest on rival FanDuel’s site. The winner beat out more than 200,000 other players and eyebrows began to rise over the possibility of insider trading.
Jackley reminded South Dakota residents that depending on the location of where the wager is received, they could be in violation of other state’s laws.