Soon after the decision was made to consider daily fantasy sports gambling, with the Nevada Gaming Control Board calling for an immediate shut down of the activity until licensing was approved, the State Attorney General released the full opinion that caused officials to make the ruling. In the document, which can be read here, the CEO of DraftKings words were used in the decision making process by the board, essentially shooting himself in the foot.

It was on Thursday of last week that the gaming regulators of Nevada decided to rule the gaming activity as gambling and stated that a sports betting license must be obtained to continue operations. FanDuel and DraftKings are included in this ruling, stating they will not be offering services until they receive licensing.

In any gambling decision, the skill vs chance argument is usually always involved. However, in this instance, the argument was not considered as in Nevada, the law only considers this in instances of the lottery. Because of this, the ruling did not attempt to determine if DFS is considered a skill game but it does suggest that the activity could be an illegal lottery, when you consider whose skill level is being assessed, whether the player or the athlete.

Supporters of DFS have felt that when the Unlawful Internet Gambling Enforcement Act was passed in 2006, it legalized fantasy sports. In the opinion, it dismisses this theory, noting that the UIGEA did not legalize or illegalize any type of gambling in the United States, but provided new ways for existing online gambling laws to be enforced and is not relevant in determining if DFS is legal.

In the opinion, Jason Robins, the CEO Of DraftKings is quoted from a discussion that took place on Reddit, where he describes the concept of the company being basically identical to a casino. He called the stakes for DFS ‘wagers’ and the activity of players as ‘betting’.

When you look at the text and graphics used at DraftKings, the terms betting and wagering are used. The opinion also states that DraftKings has applied for licensing in the UK to cover gambling software and pool betting. In the ruling, the state of Nevada found that DraftKings does recognize the appearance of inconsistency between their position that it should be unregulated based on United States activity but have licensing in the United Kingdom.

For now, both DraftKings and FanDuel will remain closed to Nevada residents and continue to be in disagreement with the new ruling. Each company is planning on working hard to ensure that they will be back in operation in the state, offering daily fantasy sports for US residents.

 

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