\nSome of the newest incarnations of fantasy football look a lot more like gambling than intricate, outsmart-your-opponent strategy games.<\/p>\n
\tSince 2011, the billion-dollar fantasy market has been infused with dozens of daily and weekly games. Those games allow players to win huge prizes quickly, sometimes in one week, sometimes in just one night. With players betting thousands or even tens of thousands a night, legal experts believe it\u2019s time to review the section of the 2006 federal law that was written specifically to protect fantasy sports from being banned the way online poker was.<\/p>\n
\t\u201cThere\u2019s importance in clarifying the law,\u201d says Marc Edelman, a professor at Fordham Law School who studies the law as it applies to fantasy sports. \u201cAs long as there\u2019s uncertainty about the legality of these games, some potential businesses that might enter the marketplace stay out.\u201d<\/p>\n
\tSeasonal leagues are largely the domain of billion-dollar companies such as CBS and ESPN, with close ties to the NFL. For now, they have remained on the sidelines of the short-term business, leaving it largely in the hands of companies such as FanDuel, which is expecting to triple its base to 500,000 fans this season.<\/p>\n
\t\u201cWe have the most popular fantasy football game going,\u201d said Kevin Ota of ESPN, which boasts an estimated 14 million fantasy players. \u201cIt\u2019s been incredibly successful, and we\u2019re focused on improving our game every year. We always keep our eye on opportunities to serve sports fans better.\u201d<\/p>\n
\tESPN officials say they have no immediate plans for weekly cash games.<\/p>\n
\tTraditional leagues at ESPN and elsewhere received their legal clearance from the 2006 Unlawful Internet Gambling Enforcement Act, which was designed mainly to stop internet poker. It included an important \u201ccarve out\u201d for fantasy football. Meanwhile, most state laws define fantasy football as skill-based propositions, which keeps them legal.<\/p>\n
\t\u201cIt\u2019s an easy argument with season-long games because you exercise a great deal of skill in operating a team,\u201d said Las Vegas-based attorney Tony Cabot, who has practiced gambling law for three decades. \u201cYou have to figure out who to draft, play, trade and all those things to have a successful season. And because you\u2019re doing all that, you\u2019re betting on an outcome you can control.\u201d<\/p>\n
\tThe day-game world can be much different and the skill level needed to \u201crun\u201d a team that exists for only one week is far lower than that for a season-long enterprise.<\/p>\n
\tAnd a growing number of fantasy sites have games that \u201clook very much like prop bets or parlay cards,\u201d Cabot says, with some games as simple as paying an \u201centry\u201d fee, then choosing who, between two players, will finish a certain day with more receiving yards.<\/p>\n
\t\u201cIt depends on how you run your game,\u201d Cabot said. \u201cIf you said, \u2018We\u2019re going to do fantasy, quick pick, random drafts,\u2019 I say, \u2018How can that be skill based?\u2019 But if it\u2019s a daily game where you\u2019re doing a draft, have the ability to change players halfway through the game and make all these decisions, then it\u2019s much closer to a traditional model.\u201d<\/p>\n
\tIn 2007, Cabot co-authored a legal paper titled \u201cFantasy Sports: One Form of Mainstream Wagering in the United States.\u201d It offers a point-by-point deconstruction of the federal law that essentially legalized a growing industry that, to some, looks very much like gambling. One of Cabot\u2019s key points is that the NFL, seeing the revenue and viewership possibilities of fantasy football, hired a well-paid lobbyist who helped smooth the way for an imperfect bill to become law.<\/p>\n
\tCabot\u2019s conclusion is that the process \u201cultimately has done a great disservice to reasoned policymaking and, potentially, to the long-term future of the fantasy sports industry itself.\u201d<\/p>\n
\tHe counts the growing day-game business as one area especially susceptible to confusion. Edelman agrees.<\/p>\n
\t\u201cOne can argue whether the fantasy sports carve out applies to the short-duration game, given that, at the time the (federal law) was passed, there was no such thing as daily fantasy sports,\u201d Edelman said.<\/p>\n
\tDay games didn\u2019t get much traction until 2011 \u2013 five years after the law was passed.<\/p>\n
\tThe games are pretty much unregulated, and they are exploding. They allow anyone over 18 to gamble on sports outcomes online, while traditional sports gambling is available online only in Nevada and, in some forms, in Delaware. The laws in the states take precedence over the federal law and they vary, most of them basing the legality of a game on how much of it is predicated on skill vs. chance. Last year, a federal court in Illinois dismissed a lawsuit alleging day games were games of chance.<\/p>\n
\tA few of the bigger media players \u2013 most notably USA Today and Sports Illustrated \u2013 have gotten into the day-game business, seeing ample opportunity in an industry that drew an $11 million investment from Comcast Ventures, which plunked the money into FanDuel last year.<\/p>\n
\tMeanwhile, the NFL, which did not respond to questions emailed by The Associated Press, keeps watching the numbers swell, while walking the line between using fantasy football to grow its game and maintaining its long-held, hard-line stance against anything perceived as gambling.<\/p>\n
\t\u201cPart of the problem with entrepreneurial endeavors on the internet is that some people push the envelope and some cross the line,\u201d Cabot said. \u201cUntil there\u2019s some sort of enforcement action on some level, I think you\u2019ll see them keep pushing that line out further and further.\u201d<\/p>\n
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