Judge rules DraftKings and FanDuel must cease operations in New York – for now

A New York judge has ruled that daily fantasy sports sites DraftKings and FanDuel must cease operations in the state for now.

New York Supreme Court Justice Manuel Mendez granted an injunction sought by Attorney General Eric Schneiderman after hearing arguments last month over whether the sites are conducting illegal games of chance or legal ones involving skill.

A DraftKings lawyer said the company would be filing for a stay of the decision. The Boston-based company plans to appeal.

The two privately owned companies are each valued at more than $1bn and the recent decision could be a major blow to the sites as both state and federal authorities determine whether or not their operations amount to gambling.

Both DraftKings and FanDuel have been criticized for their excessive advertising that promises large winnings. In October, the two companies made headlines when they were accused of insider trading after a DraftKings employee who won $350,000 during Week 3 of the NFL season at rival site FanDuel inadvertently released data that’s not generally available to the public.

Join us, it's free.

Become a member to get access to:

  • Exclusive Content
  • Daily and specialised newsletters
  • Research and analysis

Join us, it’s free.

Want to read this article and others just like it? All you need to do is become a member of The Drum. Basic membership is quick, free and you will be able to receive daily news updates.