Will Pro Sports Leagues Draw A Line In The Sand On Parlay Fantasy Sports Wagering? Don’t Bet On It.

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Sports Leagues line in sand sports betting

Some would say that Monday was the day that legal sports betting finally came to New Jersey.

That’s not quite true, of course. But Monday did feature the launch of FastPick in NJ, a form of parlay fantasy sports wagering against the house. The platform, powered by Sport Analytics and Data, looks a lot like sports betting to the trained (or untrained) eye.

The law, the pro leagues and parlay fantasy betting

Whether its sports betting or daily fantasy sports, it seems pretty clear that FastPick is legal under both state and federal law, based on the carveout for paid-entry fantasy sports in the UIGEA. (State regulators have already said the game is legal, hence why it is being offered by Resorts Atlantic City. It also stands to remain legal if a fantasy sports bill on the desk of Gov. Chris Christie becomes law.)

However, the product also sets up what might be considered a violation of PASPA. That’s the federal law that prevents single-game wagering outside of Nevada. It’s also the law New Jersey is fighting in its case that will be heard by the US Supreme Court, likely later this year. (Of note: No fantasy sports law has yet been challenged under federal law.)

The plaintiffs in the NJ case, of course, are the NCAA and the major professional sports leagues — the NFL, NBA, MLB and NHL.

The NCAA could be a wild card

The NCAA, should it be faced with trying to stop betting on college athletes (a la FastPick) might attempt to do so, via PASPA. FastPick, however, offers no wagers on college players. The platform powering it, Sport AD, has designs on offering its product in states with fantasy sports laws, and likely will stay away, as well.

The backstory: The NCAA entered into a detente with the fantasy sports industry in 2016 when FanDuel and DraftKings agreed to stop offering contests based on college sporting events. After the NCAA stood down on its lobbying efforts, the DFS sites started lobbying for laws that ban college fantasy contests. Most laws passed to date contain such language. Interestingly, the New Jersey bill does not feature such a ban (although high school contests are prohibited).

Since we don’t exactly know the terms of why the NCAA started staying out of fantasy sports sites’ business, we also don’t know how the NCAA might react to the New Jersey law, should it take effect. And, obviously, if SCOTUS strikes down PASPA as unconstitutional, all of this is moot.

Regardless of that dynamic regarding the NCAA, the pro leagues aren’t likely to join them in challenging what’s happening in New Jersey, nor would they act in other states.

The leagues aren’t going to work against fantasy sports laws

Three of the pro leagues mentioned above have equity in either DraftKings and FanDuel. Those two DFS sites are the ones largely responsible for passage of a dozen fantasy sports laws at the state level in recent years.

Long story short: The leagues are likely not going to attempt to unravel the hard work of the two companies in clarifying the legality of fantasy sports. And they certainly aren’t interested in equating any fantasy contest with gambling or sports betting.

That’s why using the language of fantasy sports laws to offer something way different than the salary-cap format is clever. It fits legal parameters while cutting down the avenues for a PASPA challenge.

The leagues need to pick their battles

First off, the pro leagues are already potentially in trouble in the NJ sports betting case. They very well could lose PASPA as their firewall against sports betting entirely, if New Jersey were to prevail.

But let’s say the leagues win in the Supreme Court, and PASPA stays on the books. Is it worth it to screw around with parlay fantasy betting?

Lets start here: It’s almost impossible to fix a major daily fantasy sports contest as offered by DraftKings and FanDuel. There are simply too many variables.

It’s also almost impossible to fix bets as offered by FastPick/Sport AD. Pay off multiple players in attempt to win the top prize of $100,000? That defies believability, as well.

So even with the fantasy sports considerations above aside, the leagues’ main claim of harm — integrity of their games — isn’t really at risk from a parlay fantasy game. There’s not much reason for them to try to stop it on that front.

Certainly, the leagues could surprise me and try to stop fantasy parlays. But I don’t think it’s likely.