Overturning a 2016 amendment

A New York appeals court ruled this week that fantasy sports contests are to be considered illegal gambling as they violate the state’s Constitution. The decision overturns a 2016 amendment that did not class the activity as gambling.

daily fantasy sports should not have been exempted from the penal code

The New York Supreme Court’s Appellate Division found that daily fantasy sports should not have been exempted from the penal code, and deemed the law unconstitutional.

The state now has the authority to review and challenge this latest ruling.

“Unconstitutional” law taken to task

In August 2016, Governor Andrew M. Cuomo signed into law a ruling declaring that fantasy sports, being “a game of skill”, did not constitute gambling.

Four New York residents challenged the ruling, saying it was an illegal exception. They argued that the law would not simply require a statutory change signed by a governor, but a constitutional amendment approved by New York State voters.

In 2018, Acting Justice Gerald W. Connolly of Albany County Supreme Court agreed that daily fantasy sports legalization violated New York state’s constitutional ban on gambling. However, he also ruled that the legislature had acted in a proper manner. This meant it could exempt daily fantasy sports from the penal code without the voters’ support.

All about a degree of chance

This week, the New York appellate court argued that, while daily fantasy sports requires skill, chance also plays a big factor. This is due to the changing nature of sports, which must take into account variables such as players’ illnesses, injuries, and weather conditions.

The office of the state attorney general is reviewing the decision and will determine whether it should head to the Court of Appeals, a spokesperson said. Daily fantasy sports betting operators FanDuel and DraftKings both issued statements following the ruling.

Reactions to the latest court decision

DraftKings rallied against the court’s decision, commenting that “the [2016] legislative action authorizing fantasy sports in New York was constitutional and in the best interests of taxpayers and fantasy sports fans.”

FanDuel believes daily fantasy sports fans in New York state should not worry just yet. The statement read:

We expect that there will be an appeal and we’ll be able to continue to offer contests while that appeal is decided.”

While the state attorney general decides whether to take the matter to New York’s highest court, the Court of Appeals, customers can still place their wagers with daily fantasy sports providers.