DFS Operators Facing Legal Issues with Prizes and Licensing
Category
🥇
SportsTranscript
00:00 [MUSIC]
00:03 >> This story, I am shocked that it's even still a story because I thought it
00:08 would have been over and done with already, but appears, I guess these,
00:13 the prize picks, the betters, the underdogs of the world.
00:17 Did they really think they'd be able to play in this sandbox without
00:22 actually paying to be in that sandbox?
00:25 Because it feels like the Seminoles, not exactly a group that I would
00:30 think would allow that to go unnoticed here.
00:33 What's the latest on this?
00:36 >> Yeah, Florida might be the worst state to try to be sneaky about gambling, right?
00:40 The Seminoles are gonna have no part of that.
00:43 >> [LAUGH] >> But look,
00:44 this isn't just a Florida issue, this is a national issue for
00:48 these DFS operators who host pick 'em games.
00:52 And whether the pick 'em game or the fact that it is against the house is the issue,
00:59 these companies and what they're offering,
01:03 they don't exactly line up to what we have in mind for
01:07 daily fantasy sports and the legality of it and the regulation of it.
01:13 Because let's face it, these contests, they just look like prop parlays.
01:17 And you have states that are taxing at high amounts, they're charging license
01:23 fees, and they don't want competition against the people that are paying
01:28 them taxes from somebody who's not paying them taxes.
01:32 It really is as simple as that.
01:34 And like you said, can't believe this is even still a story.
01:39 Because the cease and desist, the first round, that came out in September, Joe.
01:46 And so they came out and just like in many other states, they've been like, yeah,
01:50 okay, all right, we'll talk to them, we'll see what it is.
01:53 And now we're starting to see a lot of these pieces fall into place
01:59 after the Super Bowl.
02:00 And so you have to wonder if there were talks about, look,
02:03 let us get through the Super Bowl, and then we'll try to figure out how to go
02:07 about this, but Florida especially, it's just not gonna fly there.
02:13 The Seminole has so much power, Jim Allen is not afraid to go out in the media and
02:19 press and call you out and say what you're doing is illegal gambling.
02:23 And so I think we're gonna start to see this in a lot of other states.
02:28 And you look at last week, prize picks paid almost $15 million to New York
02:34 in order to get back on their good side and
02:37 be able to apply for a license in the future.
02:40 They've received cease and desist from Kansas and Arkansas this week, or
02:45 last week, excuse me.
02:47 And again in Florida, it's amazing that it's gone on for this long and
02:54 that the Gaming Commission is still being as lenient as they are being.
02:57 They're saying, look, if you get out by March 1st,
03:01 we will not take any further legal action against you.
03:05 Which sounds like a pretty good deal to me for these companies.
03:11 One of them's paying 15 million in New York, and
03:13 now in Florida they're saying, look, just leave and we can call it even.
03:18 So the bigger story about this, obviously,
03:20 is how are the DFS laws going to evolve?
03:24 Or are they going to evolve?
03:26 Do they not evolve?
03:28 We know that some of these companies have in mind launching a sports book for
03:31 themselves, but some don't.
03:34 And so are they going to continue to try to push this parlay,
03:39 prop, pick them product across the country when it looks like
03:44 the gambling regulators are starting to say, no, you can't do that.
03:48 We already have sports betting in our state, and you weren't licensed for it,
03:52 and you weren't paying us the tax dollars.
03:55 So it really is an interesting story for
04:00 DFS to be popping up again and to be relevant.
04:02 It feels like 2014, 2015 to me with how much we're talking about DFS here.
04:07 But look, it's a big story because these companies are legitimate
04:14 competitors with the DraftKings, the FanDuels, whomever.
04:19 They are fighting for the same kind of customer.
04:21 They are operating in states where these sports betting companies
04:26 are not licensed to operate.
04:28 So they're building up a database, and
04:30 they can have a jump on things whenever that state does legalize.
04:34 So this is a really big story right now.
04:36 It's one that we're watching.
04:39 It's one that I don't think anybody can honestly tell you they know how it's
04:43 going to finish up, but it's choppy waters right now for these DFS companies.
04:49 [MUSIC]