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In Protest, Fantasy Sports Group Moves Event From Nevada

By / Oct 20, 2015 (DraftKings)

The Fantasy Sports Trade Association, currently in the midst of regulatory controversy and legal challenges, decided over the weekend to move its upcoming winter conference from Nevada. The action was taken to protest a ruling that made its member companies’ businesses illegal in the state in their current forms.

The hits keep coming for the fantasy sports world, but the industry’s leading trade group isn’t afraid to throw a few hits of its own.

Last week, the Nevada Gaming Control Board ruled that it would treat daily fantasy sports as a form of gambling—and as a result, fantasy sports providers will need to get a license to operate in the state. Understandably, the Fantasy Sports Trade Association isn’t a fan of the decision; as a way of reflecting that, the association announced to its members that it would be pulling its winter conference out of Nevada.

“Given the State of Nevada’s decision to require paid contest operators to obtain licenses, and the manner in which those decisions were worded and communicated, we have chosen to relocate our winter conference. Continued patronage of Nevada is impossible for our industry at this time,” FSTA President Paul Charchian said in a statement to Bloomberg.

The commission’s move was seen as one meant to protect the territory of the casino industry. But despite the ruling essentially opening up the sector to the casino industry, the Las Vegas Review-Journal found that few casinos in the city were actually interested in acquiring a license to launch a fantasy sports site. The American Gaming Association, meanwhile, had a positive reaction to the gaming board’s ruling.

Fantasy Flames Rising

It’s just the latest controversy involving the well-funded daily fantasy sports sites. The game is legal under federal law, because it is classified as a game of skill rather than of chance, but some states (including Nevada) have higher levels of scrutiny over what is considered gambling.

Illinois is considering regulating the game, and Florida, where a federal grand jury is looking into the legality of the sites, could be next.

That investigation hasn’t left the trade group unscathed. As part of its investigation, federal prosecutors subpoenaed FSTA board meeting records on Friday, an undertaking The Wall Street Journal suggested was meant to figure out whether the association’s members were violating antitrust or fraud laws.

(The ongoing investigation has also led fellow fantasy sports player Yahoo to drop its Florida offering.)

The recent industry scandals heated up after a DraftKings employee won $350,000 on the competing site FanDuel earlier this month, though an internal investigation by DraftKings, released Monday [PDF], found that the employee did not use insider information as part of his winning streak.

Ernie Smith

Ernie Smith is the social media journalist for Associations Now, a former newspaper guy, and a man who is dangerous when armed with a good pun. More »

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