Massively popular daily fantasy sports websites DraftKings and FanDuel have officially been booted from the state of New York. A judge granted injunctions that were sought by New York Attorney General Eric Schneiderman to stop the websites from conducting business in the state.
In a separate ruling, justice for New York’s highest court Manuel Mendez wrote that Schneiderman had the proper authority to seek an injunction against the websites. From there, Mendez granted Schneiderman’s request, effectively bringing daily fantasy sports in the state to a screeching halt.
Spokesperson for the Attorney General Damien LaVera promised that Schneiderman would soon comment on the situation. DraftKings has since said that it would file an appeal.
DraftKings said in a statement, “We are disappointed with the Court’s decision, and will immediately file an emergency notice of appeal in order to preserve the status quo. Daily Fantasy Sports contests have been played legally by New Yorkers for the past seven years and we believe this status quo should be maintained while the litigation plays out.”
Representatives for FanDuel have not yet commented on the matter.
Last month, Schneiderman started the process by sending a cease-and-desist order to the two companies. He declared them to be illegal gambling operations that should be forbidden from operating in his state. The two websites responded by suing Schneiderman, arguing that they are legal games of skill and that they do not represent games of chance, which constitutes gambling.
From there, Schneiderman stepped up his effort, taking DraftKings and FanDuel to court to have them shut down in New York. An emergency hearing took place before Justice Mendez on November 25.
Since October, both DraftKings and FanDuel have been at the center of a legal controversy. This has included a grand jury in Florida, possible restrictions in several states, an inquiry from the Department of Justice and a series of civil lawsuits. The companies had been operating for several years, but massive increases in their popularity have suddenly brought questions of legality.
FanDuel came into existence in 2009, while DraftKings joined the scene in 2012. The two companies have utterly dominated the market for daily fantasy sports. It was their very heavy and bombarding advertising this year that attracted the attention of legal officials.
Earlier this year, an employee of DraftKings won $350,000 in a contest on FanDuel, calling some people to declare that insider trading was taking place. Both companies denied any wrongdoing.