DraftKings and FanDuel have been hit with another pair of damaging blows in New York state.
On Friday, as reported by USA Today, New York judge Manuel Mendez granted the state's injunction requests to ban both daily fantasy sports sites from doing business in New York.
USA Today adds that, within minutes of learning of the judge's ruling, lawyers for DraftKings filed a notice of appeal, and FanDuel expressed interest in following suit.
"The NYAG has a greater likelihood of success on the merits under the New York State Constitution ... and the definitions of gambling and 'contests of chance' as currently stated in Penal Law," Mendez wrote, as reported by USA Today, backing New York Attorney General Eric Schneiderman's request for an injunction against both daily fantasy platforms.
The whole argument is that Schneiderman is saying that daily fantasy sports platforms like DraftKings and FanDuel — and fantasy sports as a whole — are forms of illegal gambling, while the companies maintain that they are forms of skilled games that require knowledge.
Schneiderman was content with the ruling, but needless to say, DraftKings and FanDuel were not.
"We are pleased with the decision, consistent with our view that DraftKings and FanDuel are operating illegal gambling operations in clear violation of New York law," Schneiderman said in a statement to USA Today. "I have said from the beginning that my job is to enforce the law, and that is what happened today."
Friday's news comes nearly a month after DraftKings and FanDuel filed a lawsuit against New York, attempting to remain open and operating within the state.
After Mendez's motion to grant the injunctions, David Boies, an attorney for DraftKings, immediately sprung to action with an appeal.
"We are disappointed with the Court's decision, and will immediately file an emergency notice of appeal in order to preserve the status quo," Boies said in a statement. "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."
Added FanDuel in a statement:
"This is only the beginning of the legal process and, perhaps more importantly, the New York legislature is already moving forward on action to ensure our game remains legal and is regulated, which we strongly support. The court specifically noted that this was not a final determination of the issue and that discovery would be needed to fully resolve the legal question, which we think should be decided in our favor when all of the evidence is in."
If appeals by each DraftKings and FanDuel fall flat, it could pave the way for daily fantasy sports platforms, and possibly fantasy sports as a whole, being federally-regulated.
