California daily fantasy sports contests may not be long for this world.
According to a report from KCRA 3, California Attorney General Rob Bonta is expected to release a long-awaited legal opinion on the legality of California daily fantasy sports contests. He is expected to conclude all DFS contests – peer-to-peer, against the house, draft, etc. – are illegal in the Golden State.
California DFS games have operated in gray market for years, unregulated by the government or paying taxes to the state.
DFS Reviewed for Years
According to KCRA 3, the full opinion from Bonta is expected to be released on July 3.
The legality of California DFS has been in question in for years, dating as far back as 2015. California State Assemblyman Marc Levine (D-10) called for then California Attorney General Kamala Harris to declare DFS operators illegal in the state.
Neither Harris or Attorney General Xaxier Becerra shared their official legal opinion on the validity of DFS during their terms from 2011 to 2021.
California lawmakers again reached out to the Attorney General to decide on the legality of DFS in late 2023, when Sen. Scott Wilk (R-21) requested Bonta review the operations of DFS companies in California to see if their services are in line with state gambling laws. Nearly two years later, Bonta will release his official opinion, which will likely not be good news for DFS operators.
The Coalition for Fantasy Sports – representing Betr, PrizePicks, Underdog, Dabble, and Splash – said the opinion will be “devastating” for California DFS fans.
“This opinion would be devastating news to the millions of California sports fans who love to play fantasy sports. We hope the Attorney General’s office will consider the views of sports fans across the state before making a decision. Californians have been playing daily fantasy sports games for more than a decade, and it is shocking to think that the state would suddenly take them away,” the Coalition told KCRA 3.
DraftKings and FanDuel also have a heavy DFS presence in California.
If Bonta does indeed declare DFS illegal, the opinion will likely end up challenged in California courts by the operators. California is one of, if not the largest, DFS market for these companies in the country.
California Tribes Turned Up Heat on DFS
Over the last year, California tribes took aim at DFS operators in the state, hoping the Attorney General would find their operations illegal.
The California Nations Indian Gaming Association (CNIGA) submitted a letter to the California State Legislature earlier this week, when rumors that DFS operators were working with state lawmakers to introduce a bill to legalize the games in the state.
“Despite this pending opinion, some fantasy sports interests are already approaching members of the Legislature to author and/or support a bill on this issue. We respectfully urge you to withhold any commitments or authorships until the Attorney General releases his opinion. It is essential that all stakeholders – including the Legislature – have the benefit of clear legal guidance and facts before proceeding with any legislation,” CNIGA Chairman James Siva and Chairwoman Lynn Valbuena, the Tribal Alliance of Sovereign Indian Nations, wrote in the letter.
California tribal leaders have historically shared their displeasure with the DFS industry, turning up their attention this year.
Siva appeared on The New Normal podcast, hosted by Victor Rocha, conference chairman of the Indian Gaming Association, and Jason Giles, executive director of the Indian Gaming Association, this past October, criticizing the DFS and sweepstakes industries in the state.
During the episode, Siva made it quite clear that he believes DFS is illegal, according to the California constitution, and threatens tribal gaming exclusivity in the state.
“The fact is, according to the California constitution, DFS is illegal in every way,” he said during the episode.
Rocha flatly said DFS operators cannibalize tribal gaming operators, taking revenue out of California through their untaxed and unregulated offerings.
“When we’re talking about cannibalization, this is what we’re talking about. They’re taking money out of California. It’s unregulated and it’s untaxed,” Rocha said.
California Attorney General Likely to Declare DFS Illegal Saturday Down South.
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