The California Attorney General’s Office recently announced plans to prepare a formal opinion on the legality of daily fantasy sports in the state. This decision follows a request from Republican Senator Scott Wilk seeking clarification on whether California law prohibits the offering and operation of daily fantasy sports platforms within the state, regardless of the location of the operators and technology.
As of November, California residents can access daily fantasy sports contests through a variety of operators, including Pricks, Underdog Fantasy, and Betr. Although fantasy sports are not regulated in California, they are not considered illegal, allowing major operators such as FanDuel and DraftKings to tap into the state’s vast market, which has a population of about 39 million.
However, it is important to note that despite the popularity of fantasy sports, online and retail sports betting in California is still far from reality. State lawmakers in the past have rejected two sports betting measures indicative of a cautious approach to expanding the gambling landscape.
The controversy surrounding daily fantasy sports extends far beyond California’s borders. Other states are also grappling with the regulatory challenges posed by these contests. For example, in September, Florida gaming regulators ordered fantasy operators to cease operations due to concerns about potential illegal betting or wagering activities. Likewise, Ohio regulators have taken similar measures to ban pick’em-style contests.
On the other hand, some states chose to solve the problem by implementing new regulations. Michigan, for example, recently introduced administrative rules to ensure fair play for fantasy sports contests. These rules expressly prohibit competitions that mimic sports betting, aiming to protect the integrity of competitions while allowing operators to continue offering their services.
North Carolina took a slightly different approach by starting the rulemaking process for online fantasy operators. Proposed rules in the state clarify that fantasy contests should not rely on proposition bets or mimic other types of sports betting. These developments in North Carolina coincide with the upcoming launch of sports betting in the state, expected in 2024.
The upcoming official opinion from the California Attorney General’s Office carries significant weight in determining the future of daily fantasy sports in the state. Depending on the findings, the opinion could lead to regulatory measures that would legitimize and guide operators or impose restrictions on their activities.
If daily fantasy sports were to be regulated in California, it would bring a sense of legal clarity to the industry, potentially attracting more operators and creating a safer environment for players. Additionally, regulation could pave the way for the expansion of online and retail sports betting, providing additional opportunities to consumers and generating revenue for the state.
But if the opinion concludes that daily fantasy sports are illegal in California, it could have far-reaching consequences. Operators currently offering services in the state could be forced to cease operations, leaving players with limited options. Additionally, a negative opinion could further delay progress towards legalizing sports betting, disappointing those who have been eagerly awaiting its arrival.
The California Attorney General’s upcoming official opinion on the legality of daily fantasy sports in the state has the potential to reshape the landscape of the industry. As discussions continue, operators and lawmakers await the decision, which will have implications not only for daily fantasy sports but also for the broader gambling market in California.