Another state has determined that daily fantasy sports runs afoul of its gambling laws.
Idaho Attorney General Lawrence Wasden announced on Monday that the two high-profile DFS operators, DraftKings and FanDuels, have agreed to stop offering paid contests to residents in the state.
In a news release, Wasden concluded that daily fantasy sports contests are considered illegal gambling in Idaho. The state’s Constitution bans gambling save for the state lottery, pari-mutuel betting as well as bingo and raffle games.
“Idaho defines gambling, in part, as risking money or other thing of value for gain that is contingent in whole or part upon chance or the outcome of an event, including a sporting event,” Wasden said. “My concern is that the daily fantasy sports offerings my office reviewed require participants to risk money for a cash prize contingent upon individual athletes’ collective performances in various future sporting events. As I see it, this falls within Idaho’s definition of gambling.”
The attorney general said he began investigating the two sites in January. Then, after a three-month-long negotiation, DraftKings and FanDuel agreed to block Idaho residents from participating in the online contests effective May 1.
Under the agreement, the DFS operators will use a geo-blocking technology or IP addresses to block Idaho players, but they will still be allowed to withdraw their account balances.
This is the second time DraftKings and FanDuel, which have been adamant that fantasy sports is a skill-based game, have agreed to pull out their services. Last week, the two operators announced they are exiting Alabama after the state’s attorney general, Luther Strange, ordered them to cease and desist all real-money activity with Alabama residents starting May 1.
So far, the attorneys general in Massachusetts, Rhode Island and Kansas have ruled daily fantasy sports as legal, while 12 others believe it is illegal gambling.
Idaho might have outlawed DraftKings and FanDuel for now, but the state AG’s agreement allows the two companies to resume their operations if the state’s Legislature changes its strict gambling stance or if a judge overturns the statute.
Wasden said the companies can also restart offering such contests at any time, but executives have agreed to provide him written notice 30 days prior to doing so. The notice serves to give Wasden time to evaluate the proposed contests to determine whether they comply with Idaho law.
