While U.S. online gambling is illegal except in four states, fantasy sports has slid into a gray area and has not been challenged. DraftKings says on its website that the business it is in is a “game of skill” and is legal under U.S. and Canadian law.
But Daniel Wallach, a shareholder with the Fort Lauderdale law firm Becker & Poliakoff, said that some states, including Florida, even prevent gambling in games of skill and that “on the continuum of skill to chance, it’s certainly closer to the chance line than season-long leagues are.”
“As more legitimate money flows into the daily fantasy sports environment, people are saying ‘Oh they’ll never prosecute,’ and that puts an aura of legitimacy over it,” he said. “But the truth is, it’s gambling, not entertainment, and we’ve yet to have seen any court opinion either way.
“I’m not trying to tamp down on the enthusiasm, but it could be close to the line,” said Wallach, who spoke March 30 at the International Masters of Gaming Law Conference in St. Thomas, Virgin Islands.
Because those who play daily fantasy sports watch more than twice the number of games on TV as a non-gambling fan, all four major sports leagues signed sponsorship deals with daily fantasy sites. On April 2, DraftKings announced a multiyear deal with Major League Baseball that makes it MLB’s “Official Daily Fantasy Game.” In September, NBA Commissioner Adam Silver said legal sports betting was “inevitable.” And FanDuel announced in April that it has sponsorship agreements with 15 NFL teams (but not the Dolphins) that allow stadium signage, similar to agreements teams make with casinos.
At the November Florida Gaming Congress in Miami, Wallach suggested that states link the casinos to fantasy sports and to sports gambling — both of which are big money and skew younger than current casino crowds.
Wallach notes that 41 million people play fantasy sports and paid up to $4 billion in entry fees. Sports gambling is close to pulling in $500 billion annually, with almost $10 billion alone bet on the Super Bowl.
He suggested that the state legislature consider approving those activities for casinos, which would increase tax revenue for the state and bring new foot traffic to the casinos. No such idea has been proposed in the Florida Legislature.
“But it could be dawn of a new age in Florida.”
