GPWA Times Magazine - Issue 8 - April 2009

| GPWA Times Joseph M. Kelly , Ph.D., J.D., co-editor-in-chief of Gaming Law Review and Economics, is a professor of business law at SUNY College Buffalo in New York and an associate of Catania Consulting in Halcedon, N.J. Living in a Fantasy erations do charge fees, which might be as high as $1,500. The NFL has no restrictions against its players engaging in fantasy sports and also “runs its own fantasy football site, and gets royalties from others.” Gaming experts are puzzled by the NFL atti- tude. According to Professor I. Nelson Rose, the NFL position “doesn’t make sense to me how anti-gambling the pro and college sports have always been.” Arnie Wexler, who works to help recovering gambling addicts, stated he has “seen more than a few addicts get lured in by fantasy football. ‘I had a guy who was 27 years in recovery, and all of the sudden, he started picking fantasy football teams for his grandchild . . . the next thing you know, it gets his juices flowing, and it happens’ ” The change of attitude of the NFL from hostility to acceptance of fantasy sports is puzzling, especially since “for three decades the NFL distanced itself from fantasy football” Written opinions by three separate state at- torneys general have concluded that fantasy sports were illegal. The attorney general of Florida, a state that prohibits skill games, stated that it is unlawful to bet or wager mon- ey that “has been staked wagered or bet on the result of a contest of skill.” A similar result was reached by the attorney general of Louisiana, who opined concerning a 1-900 number and a fantasy team, that it would be an offense since Louisiana prohibits a game where “a per- son risks the loss of anything of value in order to realize a profit” It is doubtful whether any attorney general or district attorney would bring criminal charges against a fantasy sports club that complies with the Unlawful Internet Gambling Enforcement Act. Instead, legal action is often brought by plaintiffs seeking easy money. Seven states and the District of Columbia allow individuals to recover gambling losses, sometimes even if the litigation is brought by strangers to the transaction. Since it is doubtful whether a conclusion of any governmental prosecution of fantasy sports operators would be successful, entre- preneurs will seek creative ways to expand the parameters of fantasy sports. The fantasy sports litigation might also open the door to the legality of other games of skill. The fantasy sports exemption in the UIGEA reads as follows: (ix) Participation in any fantasy or simulation sports game or educational game or contest in which (if the game or contest involved a team or teams) no fantasy or simulation sports team is based on the current membership of an actual team that is a member of an amateur or professional sports organization (as those terms are defined in section 3701 of title 28) and that meets the following conditions: (I) All prizes and wards offered to winning participants are established and made known to the participants in advance of the game or contest and their value is not determined by the number of participants or the amount of any fees paid by those participants. (II) All winning outcomes reflect the relative knowledge and skill of the participants and are determined predominantly by accumulated statistical results of the performance of individuals (athletes in the case of sports event) in multiple real-world sporting or other events. (III) No winning outcome is based on the score, point-spread, or any performance or performances of any single real-world team of any combination of such teams; or solely on any single performance of an individual athlete in any single real-world sporting or other event.