Both women and non-sports fans alike are cheering the recent news surrounding the legality of daily fantasy sports. Finally, there’s hope for office water-cooler discussions that don’t revolve around whether Peyton Manning will finally bounce back against the Colts’ suspect passing defense, or whether the cubicle-mate’s Adrian Peterson for Odell Beckham Jr. trade was brilliant or beyond foolish.
While fantasy sports have been a national disease for years, the recent epidemic of the game in its newest incarnation – daily fantasy sports – has turned what was once an obsessive hobby into just an obsession. While traditional fantasy sports, such as baseball, football, hockey, or basketball, include a draft and then the season-long drudgery of maintaining a winning team, daily fantasy sports has the draft – but then only a one day commitment. The instant gratification has struck a chord with an American populace increasingly unable to concentrate for longer than it takes to pull out a phone. As a result, daily fantasy game sites like FanDuel and DraftKings have attracted hordes of sports fans who were intimidated by traditional fantasy games, just like Twitter attracted hordes of would-be short story writers.
Needless to say, this spawned numerous websites offering daily fantasy games, because capitalism. Some of the more popular sites, like FanDuel, set up huge buy-in leagues, where people could buy into a draft, and compete against others across the country for prize money, also because capitalism.
However, states and the federal government all have laws about gambling, and daily fantasy sports websites occupy uncertain territory. The Department of Justice has even opened an investigation into the business model of daily fantasy sites. According to Ryan Rodenberg, an assistant professor of sports law at Florida State University, “on the spectrum of legality to illegality,” daily fantasy sports sites are “getting pretty close to the line.” Key in the determination is whether daily fantasy sports are a game of skill or a game of luck.
Naturally, different states and the federal government have different ideas on how to figure out whether a game is skill or luck. Most states try balancing a game’s chance-based outcomes versus its skill-based ones. With regard to daily fantasy sports, this will likely result in equally strong arguments for both sides, and the potential for an ironic coin flip.
Fortunately, several states have already weighed in on the decision. How they’ve gone about resolving it sheds light on how things might turn out if daily fantasy sites are taken to court.
Both Florida and Kansas have issued executive opinions, saying that fantasy sports in general are examples of illegal gambling because they’re inherently chance-based. However, the way that the Kansas Racing and Gaming Commission (KRGC) reasons this out shows that they only think fantasy sports are chance-based because they were terrible at playing it.
According to the KRGC, while “there are some elements of skill involved in fantasy leagues,” these are outweighed by the chance involved in:
- Whether the player’s actual team in a given week executes a game plan that fits the player’s talents; whether the coach calls plays that favor the player;
- How a drafted athlete performs in a future event;
- Whether a drafted player is injured; and
- How opponents of the actual player (who may be drafted by another manager) actually play
Clearly, the commissioners at the KRGC are just armchair managers who are ticked that Bryce Harper lost his catcher eligibility, who are still bitter about going all in for Jesus Montero, who traded heavily to acquire Yu Darvish and Adam Wainwright, and who excused their own poor play by saying their opponent did uncharacteristically well. Because none of the KRGC’s commissioners have ever been able to make it out of the consolation bracket in five years, they’ve all become absolutely convinced that it involves nothing other than luck.
Unlike the KRGC, the Federal District Court in New Jersey has stated that fantasy sports are more skill than luck and, in so doing, showed that they’re likely dominating fantasy leagues, as we speak:
The success of a fantasy sports team depends on the participants’ skill in selecting players for his or her team, trading players over the course of the season, adding and dropping players during the course of the season and deciding who among his or her players will start and which players will be placed on the bench.
If the Department of Justice decides to pursue its investigation and file a lawsuit, they should take the time to research the judges in a particular jurisdiction before filing there. Judges who regularly play fantasy sports will be far more likely to rule that it’s a game of skill rather than a game of luck. This kind of research would even build the types of skills necessary to become a force to be reckoned with in fantasy sports. It would even teach valuable lessons in risk hedging: In case the DoJ’s investigation doesn’t get off the ground, at least its attorneys would be in a position to capitalize, just like good fantasy players know to prepare for injuries and other mid-game disasters.