Illinois Attorney General Lisa Madigan was asked by the legislature recently what her opinion was on the legality of daily fantasy sports in the state. She said that her opinion was that it was illegal. DraftKings, in turn, made a deal with the state that will allow them to continue to operate there until a hearing in June that will determine the legality of the contests. It's also looking like FanDuel is going to make a similar deal, so daily fantasy sports will be safe in this state until at least the summer.
A Long Chain of Events
It's been a pretty long chain of events that have led to this situation. Florida was one of the first states to take a closer look at daily fantasy sports and the legality of the contests themselves, and California is one state that has been proposing regulations for the industry instead of outright banning it. All of the attention the industry has gotten in the past couple of years has led to a climatic situation for the industry, however.
This came after the New York Attorney General send a cease and desist letter to DraftKings and FanDuel, claiming that daily fantasy sports was illegal in New York state. A court case is pending over that particular issue, and it wasn't long after this that the Illinois situation happened. Now it seems that the industry is receiving attention from state governments all over the country, so it's a very volatile time for the industry.
Any particular ruling, especially the one in New York, could have long-term effects for an industry that's already has its share of problems. Something that makes this situation unique, however, is that there are already tons of deals in place with major sports companies and leagues including virtually every major league sports team in the United States. The bottom line is that there's a ton of money up in the air around this, and while the leagues have typically been against sports betting in the traditional sense, they seem to be in favor of the deals they have with the daily fantasy sports leagues. That makes it particularly interesting and exciting to see the direction that these court proceedings go.