Yahoo ensnared in New York fantasy sports probe

When Yahoo announced at a San Francisco sports bar this summer that it was introducing a new high-stakes fantasy sports website allowing users to wager up to $600 each day, the company asserted that it was a game of skill, not gambling.

New York Attorney General Eric Schneiderman might not be buying that argument. The prosecutor who this week accused popular fantasy sports startups DraftKings and FanDuel of illegal sports betting is now adding the Sunnyvale tech giant to his probe, according to an unnamed source who spoke to the New York Times.

Yahoo said in an emailed statement Wednesday that it “does not comment on legal matters. We are monitoring industry trends and events closely and believe that we offer a lawful product for our Daily Fantasy Sports users.”

Users can pay up to $600 in “contest entry fees” each day, and Yahoo gets 10 percent of the amount wagered, the company has said.

“We certainly encourage people to play responsibly,” Ken Fuchs, who led Yahoo Sports as the company’s former vice president of publisher products, said when he introduced the new product at a press conference in July. Fuchs has since left the company, joining an exodus of executives in recent months. He is now CEO of sports statistics firm Stats LLC, which provides content to media and professional and fantasy sports leagues.

Yahoo’s daily fantasy sports offering — a more intense version of the seasonal fantasy sports leagues popular with many Americans — launched on browsers and mobile devices on July 8 in all but a handful of U.S. states. New York was one of them, but it might not be for long.

Schneiderman, who on Tuesday filed an enforcement action seeking to shut down DraftKings and FanDuel in his state, objected to their argument that Daily Fantasy Sports is not gambling because it involves skill:

“This argument fails for two clear reasons,” his office said on its website. “First, this view overlooks the explicit prohibition against wagering on future contingent events, a statutory test that requires no judgment of the relative importance of skill and chance—they are irrelevant to the question. Second, the key factor establishing a game of skill is not the presence of skill, but the absence of a material element of chance. Here, chance plays just as much of a role (if not more) than it does in games like poker and blackjack. A few good players in a poker tournament may rise to the top based on their skill; but the game is still gambling.”

Above: Ken Fuchs, Yahoo’s vice president of publisher products, announced the company’s new Daily Fantasy sports product at a San Francisco sports bar on July 8. He has since left the company. (Karl Mondon/Bay Area News Group)

 

Tags: , ,

 

Share this Post



 
 
 
  • bill

    On Tuesday November the 10th our Attorney General Eric Schneiderman took
    it upon himself to declare daily fantasy sports illegal in our state of
    New York.

    His “reasoning”:
    1. he ruled daily fantasy sports is nothing but a game of chance, with no skill
    2. the ads the two sites run are seriously misleading New York citizens about their prospects of winning.
    3. he clams “daily fantasy sports appears to be creating the same public health and economic problems associated with gambling.”

    NOW if i open up the back door of my business, I see the Batavia Downs….a
    horse track full of slot machines ……..there is zero skill in playing slots…..

    Then i can walk next store a buy lottery tickets at Tops Markets, and guess
    what the lottery does? …….it runs advertisements about winning life-changing piles of cash,and to top it off there is zero skill playing the lottery. DOLLAR AND DREAM BABY, DOLLAR AND A DREAM

    Then he tries claim gambling on daily fantasy sports is causing public health and economic problems. While at the same not attacking the horse racing, slots and the lottery. Gambling is Gambling.

    IT IS OBVIOUS Schneiderman is JUST STANDING FRONT OF US LYING. If he was
    really trying to protect us from the evils of gambling, he would outlaw
    all forms of gambling, but he is not. Which means he is LYING to us.

    There is no valid excuse for the Attorney General of New York State to stand in front of us and lie….NONE …..and that is what he is obviously doing, he needs to step down and tell us the real reason he has done this, or he needs to be impeached and jailed.

    At this point his out and out lying is more important than debating whether fantasy sports is gambling

 
 
css.php