Online Gambling Giants Pivot to Legal Maneuvers Against Fantasy Sports

The online gambling industry, which once fought tooth and nail for the legalization of online sports betting, is now rallying against fantasy sports leagues. Spearheaded by major players like FanDuel and DraftKings, the industry is employing legal maneuvers to render fantasy league wagering illegal, raising concerns about stifling competition and consumer choice.

Wyoming Sets Precedent as Online Gambling Giants Target Fantasy Sports Leagues

Having secured a landmark victory in 2018 with the Supreme Court’s decision to overturn the federal ban on sports betting, online gambling giants are now invoking similar legal arguments to target fantasy sports leagues, according to an opinion piece published in political journalism media outlet Townhall. 

This sudden shift in stance underscores a classic case of incumbent interests leveraging political influence to quash emerging rivals.

The rapid rise of fantasy sports leagues, hailed as the fastest-growing segment in American sports, has garnered immense popularity, boasting a staggering 50 million participants nationwide. What began as a casual pastime has evolved into a multi-billion-dollar industry, with enthusiasts drafting players and competing for substantial cash prizes based on real-world performance metrics.

However, the industry faces mounting scrutiny over the classification of fantasy sports as games of skill versus games of chance.

The Sports Betting Alliance, representing traditional online gaming firms, contends that fantasy leagues operate as illicit gambling platforms disguised as harmless entertainment. This argument has found resonance in regulatory circles, with the Wyoming Gaming Commission setting a precedent by deeming fantasy leagues as unlawful gambling enterprises.

Critics Slam Industry’s Bid to Stifle Competition Through Regulation

The regulatory crackdown threatens to upend decades of legal precedent distinguishing between games of skill and games of chance. If upheld, it could spell the demise of online fantasy leagues or subject them to onerous government oversight, jeopardizing their accessibility and profitability.

Critics argue that the industry’s efforts to stifle competition under the guise of regulatory compliance are misguided and self-serving. With no tangible evidence of harm to the public, the push to criminalize fantasy sports appears motivated by a desire to preserve market dominance rather than protect consumers.

For instance, in September last year the Florida Gaming Control Commission has issued cease-and-desist letters to daily fantasy sports operators, including Underdog Sports, PrizePicks, and Betr, alleging potential involvement in illegal sports betting activities. 

The letters, signed by executive director Louis Trombetta, raised concerns about the legality of these operators’ activities in Florida, with potential implications for all forms of paid fantasy sports contests. While industry giants DraftKings and FanDuel escaped scrutiny, emerging players like Betr, backed by Jake Paul, faced regulatory obstacles in Florida, impacting their plans to revolutionize the traditional betting experience.