Paxton: Sports Gambling Websites Require Law Change
It is well known that Texans and Sports are a perfect fit, especially where it comes to football. So its not surprising that Fantasy Sports Leagues have grown as a fun way for Texan's vicariously through competition of actual game participants on the play field.
Numerous companies have now built innovative business models that expand the friendly leagues to a more complex environment that involves hundreds of millions of dollars. In normal circumstances such entrepreneurship is normally a welcome fit in the business-friendly state. However, many Texans have a deep culture of scepticism, toward gambling and the impact on the communities.
Ken Paxton: Daily fantasy is illegal gambling
Within Texas, the law is very clear and that the gambling laws are triggered partially (that is to say, any)by chance. This is based on the text of the law and is therefore reinforced by his predecessors' opinions.
There are some business practices of a few companies that actively cross the line between Fantasy Sports and illegal gambling. It is to be noted that the traditional Fantasy League, where participants either don't gamble money or they will split the entire pot, is, as a general rule considered to be legal and it's when the third parties get are getting a cut of the pot that they get into the dangerous legal ground.
In defence the Fantasy Sports companies claim their Fantasy Leagues are not about chance, however an injury or a bad call by a referee are impossible to predict which means that chance can and does make a difference of winning or losing for a team or a fantasy lineup.
The DFS companies insist that it is a contest of skill, and point out a punters ability to successfully pick players and teams using detailed analysis to pick the better players and teams. This is just like poker players may play a hand better than another player, however the chance of the sporting event remains - there is always some chance.
The DFS operators also claim that their contests measure a person's ability to predict performance of players in the same way, for example, that golf tournaments measures a person's ability to play golf successfully or a fishing tournament measures the ability to catch fish.
Mr Paxton said that the Daily Fantasy Leagues, however much skill is or is not involved, that a bet on the bona fide contest, that it is, the actual players on the field playing the actual sport is where the skill lies.
He said that the opinion he had issued was meant to alert many of the businesses involved that there are real concerns here.
As he prepared his opinion, a strategic and well-coordinated which is a well-funded campaign has been underway within Texas for the conflation practice of everyday, friendly Fantasy Sports Leagues, and big online companies making millions of dollars off losses from ordinary Texans. It is worthy of note that in an injunction that was sought by the New York attorney general, revealed that almost 90% of DraftKings players lost money during 2013 and 2014. These companies hired highly expensive lobbyists and lawyers, for the purpose of engagement in a clever advertisement campaign and social media blitz, this also included a recent op-ed attack on this office.
Mr Paxton continued that there is no amount of lobbying, marketing, and advertising muscle that can change the law by sidestepping Legislature. He said that the friendly leagues aren't the issue, and they are not in any danger of being shut down. He noted that this was about the companies who were acting, in essence, as the house, and that they are making millions of dollars off of Texans who are losing money weekly. He stated that neither him nor his office will cower from the truth because of attacks in the op-eds or on social media, which are powered by loud voices and also funded by businesses with deep pockets.