Significant developments out of the Massachusetts today, as state Attorney General Maura Healey clarified the legal status of daily fantasy sports in Massachusetts while an editorial in the state’s leading media outlet called for immediate regulation of DFS.
Healey gives DFS the green light
Per the Boston Globe:
Attorney General Maura Healey said Wednesday that she’s not pursuing any criminal inquiries into the Boston-based fantasy sports league website DraftKings Inc., which was thrust into the national spotlight this week when an employee from the company collected winnings from a rival website’s contest allegedly based on insider information.
She said that there were no federal or state laws that prohibit daily fantasy sports sites from operating, and customers who use DraftKings’ services shouldn’t be worried that they’re breaking the law.
Healey’s statement carries no official force outside of the state, but her conclusion may still resonate beyond the borders of Massachusetts, especially given the general lack of legal clarity surrounding DFS. In the absence of a directly conflicting opinion, Healey’s comments may provide political and cultural cover for policymakers seeking to affirm the legality of daily fantasy sports.
The recent data leak at DraftKings also elicited a response from Healey. “I think that those who play want to be, and expect to be, assured a level playing field,” Healey told the Globe. “I think it’s important to me that that is in place.”
Boston Globe calls for regulation
Following Healey’s comments, the Boston Globe released an editorial entitled “Regulate fantasy sports games.” Excerpt:
The ubiquitous marketing — $31 million in TV ads during the first week of the NFL season alone — has exposed the online fantasy sports business for what it really is: unregulated gambling that’s in need of greater oversight. It’s no small irony that the Commonwealth has obsessed about casinos for a decade, and yet a startup that collects fees and distributes winnings (albeit with sophisticated technology) has taken root and flourished for four years without a bit of regulatory attention.
The editorial closed with a clear call for state oversight of DFS, asserting that “[t]he fantasy sports industry, as gambling, needs to be treated like other forms of gambling in which there are clear rules, and the state gets a cut.”
While Healey sets the agenda for enforcement of state law, the question of regulation involves additional stakeholders such as state lawmakers and members of the gaming regulatory apparatus, who will likely be critical voices in the debate over whether to regulate DFS in Massachusetts, and how to regulate if such a path is pursued.