FanDuel Lays Off Workers As Legal Pressure Mounts

Amid the increasing regulatory and legal challenges across states regarding whether Daily Fantasy Sports constitutes gambling, one of the two largest DFS operators in the industry is paring back staff.

A source at the New York-based FanDuel said that the operator had begun laying off some staff. A senior executive of the company announced the layoffs. It is not known how deep these cuts are or in how many departments. Initially, when approached for comment, a spokesperson for FanDuel denied that there were any layoffs in the pipeline.

The layoffs at FanDuel have come at a time when DFS is under siege. Very recently, the Texas Attorney General, Ken Paxton, stated he considered Daily Fantasy Sports illegal gambling in his state.

Texas is the most recent of a number of states classifying Daily Fantasy Sports as gambling. Other states that have targeted FanDuel and DraftKings, placing legal restrictions on them, include Washington State, Illinois, New York, Massachusetts, and Nevada.

Peter Schoenke, chairman of the Fantasy Sports Trade Association, said that if A.G. Paxton was truly concerned about the small businesses operating in Texas as well as the millions of people who enjoy Fantasy Sports, he would stop the grandstanding and begin working with the FSTA and Texas Legislature toward common-sense consumer protection issues like those being proposed in Illinois, Massachusetts, Indiana, Florida, California, and other states looking toward the future.

The Fantasy Sports Trade Association, FanDuel, and DraftKings continue to maintain that Daily Fantasy Sports is a game of skill and therefore should not be classified as gambling.