The Attorney General for New York has filed a lawsuit demanding fantasy sports companies DraftKings and FanDuel give back all the money they made in the state, reports Reuters.
The suit states both companies are continuing to operate illegal gambling operations based on local laws, and is seeking a civil penalty of up to $5,000 per case.
FanDuel has more than 600,000 players in the state, about 10 percent of its users and DraftKings has more than 500,000 daily fantasy players in the state, according to Eilers Research.
The sites maintain that the format – players make bets against fluctuations in how their fantasy teams perform which in turn is based on real-world performance – is merely an entertainment game based on skill and not ‘wagering’ or betting per se.
New York Attorney General Eric Schneiderman however, feels differently.
This is just the latest chapter in an on-going saga between the companies and New York. In November last year, Scheniderman sent both companies cease-and-desist letters after concluding both sites were operating illegally.
Just three days later, FanDuel and DraftKings sued the state to allow them to keep operating there.
A month after that, the companies were drafted a temporary injunction, allowing them to continue to operate.
Both companies have a lot at stake in New York: they have offices in the area (FanDuel is headquartered there) and maintain lucrative partnerships with area teams.
Don’t expect this one to come to an amicable ending any time soon.