DraftKings And FanDuel Are Fighting New York’s Ban

FanDuel and DraftKings New York City Ban

As expected daily fantasy sports platforms FanDuel and DraftKings are preparing to take New York state’s ban on their platforms to court. The company’s were banned from doing business in the state after New York’s top prosecutor deemed their services to be the equivalent of an illegal gambling operation.

DraftKings called the cease and desist order issued by New York Attorney General Eric Schneiderman on Tuesday “hasty and uninformed” and said it was prepared to mount a legal challenge so it could continue New York operations.

“We will pursue this fight to the fullest to ensure that New York fantasy sports fans do not need to stop playing,” DraftKings said in a statement on Wednesday.

FanDuel also said it plans a legal challenge.

DraftKings and FanDuel has asked hundreds of thousands of users in New York state to mobilize in support of their platforms. Both company’s have asked users to send Schneiderman emails voicing support for the games. FanDuel said they have more than 600,000 players in the state; DraftKings said there were more than 500,000 daily fantasy players there.

Under New York law the two companies have five business days to respond to the order. They have continued to operate through the notification period.

Schneiderman’s order does not apply to season-long fantasy sports contests, choosing instead to specifically target FanDuel and DraftKings over their daily and weekly fantasy games.

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Both platforms have big time investors. DraftKings raised $300 million from investors including Fox Sports, Major League Baseball, the National Hockey League, and the Madison Square Garden Company. FanDuel raised $275 million from investors such as private equity firm KKR & Co LP, Google Capital and the venture arms of Time Warner Inc and Comcast Corp.

DraftKings and FanDuel have both hired former New York prosecutors to help mount a legal defense.