Virginia is the latest state where pick’em daily fantasy sports (DFS) face uncertainty following legal blowback.
Virginia Attorney General Jason Miyares, responding to State Delegate Wren Williams, issued an opinion last week identifying pick’em daily fantasy sports contests that pit players against the house as de facto gambling.
“It is my opinion that, because fantasy contests require multiple customers competing against each other, a gambling arrangement that involves customers betting on athletes’ performance metrics against an operator’s established baseline, and not other contest participants, constitutes sports betting as defined in Virginia Code § 58. 1-4030,” Miyares said in his opinion.
Scrutiny over pick’em DFS continues
Williams identified the contests in question as “pick’em-style” fantasy or “over/under player prop pick’em” games. They have been the subject of scrutiny in a growing number of states over the past six months.
Like Virginia, states such as Florida, New York and more recently California are exploring whether those games are more akin to sports betting, and thus subject to gambling and/or sports betting laws. Depending on the state, that could mean a major difference in tax and licensing costs and availability.
Miyares’s opinion is not legally binding, though Attorney General opinions often inform lawmaking decisions. Should the Virginia Assembly explore a change in its DFS laws during its upcoming session, it might refer to the opinion.
DFS trade group weighs in
The Coalition for Fantasy Sports, which represents licensed Virginia DFS operators PrizePicks, Underdog Fantasy and Sleeper, released the following statement:
“We disagree with the Attorney General’s opinion and look forward to continuing our positive working relationship with our governing agencies in the Commonwealth of Virginia. The opinion does not supersede the licensing process in place as established by the Virginia General Assembly. The Office of Charitable and Regulatory Programs (OCRP) is responsible for administering the Fantasy Contests Act in the Commonwealth. Our member companies are licensed and continue to operate legally in Virginia.”
The group has fought against rules in Michigan and New York that declared most pick’em games as de facto sports betting.
Single player statistics an issue for pick’em DFS
Pitting players against the house is not the only reason Miyares believes pick’em constitutes gambling:
“Although the fact that individual contestants are not competing against each other is critical to this determination, I further conclude that, to the extent contest results hinge solely on individual performance metrics stemming from a single sports event, the contest also falls outside the definition of ‘fantasy contests’ and instead constitutes sports betting.”
Similar distinctions have led to companies like Underdog reshaping their formats in states like Colorado, where fantasy points, not single statistics, determine a contest’s outcome. Elsewhere, DFS companies have turned to free-to-play or peer-to-peer formats in response to legal scrutiny.
What Virginia fantasy laws say
Virginia was the first state to legalize DFS back in 2016. The fantasy law states that for contests “participants compete against each other and winners are determined based on accumulation of statistical performance.”
Virginia’s Office of Charitable and Regulatory Programs, which oversees fantasy sports, declined to comment on the Attorney General’s opinion.
Legal Virginia sports betting started in January 2021 and the state is home to 16 sportsbooks.