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Daily fantasy sports sites DraftKings and FanDuel filed temporary restraining orders against potential action by the New York attorney general on Monday, only to see those orders denied later in the day.
An emergency hearing will be held on Wednesday, Nov. 25. DraftKings offered this statement after the TRO was denied:
“The Court granted our order setting this case for an emergency hearing next Wednesday. The AG assured the Court he will take no action against DraftKings or its business partners before then. On that record, and because there will be an emergency hearing next week, the Court determined that no TRO was necessary. We are confident in our legal position, and look forward to our day in court next week. As a result, we intend to continue operating in New York.”
After that statement was released, there are conflicting reports about the NY AG’s intentions:
NYAG: "That did NOT occur in court" –> DraftKings: The AG assured the Court he will take no action against DraftKings before Wed. #DFS
— Jess Golden (@JGolden5) November 16, 2015
The immediate impact of this ruling is now unknown, after this development, barring further clarification.
Last week, NY AG Eric Schneiderman issued cease & desist letters to both DraftKings and FanDuel, telling the two DFS operators that they were conducting “illegal gambling,” in the opinion of his office.
The news of the TROs being denied by the state supreme court was broken on Twitter in the evening on Monday:
BREAKING: Judge denies temporary restraining order sought by DraftKings and FanDuel to stop efforts to shut them down in NY.
— CNBC Now (@CNBCnow) November 16, 2015
The court’s decision came on the same day that a bill to legalize DFS in the state was introduced.
While it is a setback in their legal battle with the NY AG, it is not even close to the end of the road, as the sites are not out of legal remedies in contesting the NY AG’s order.
Next Wednesday’s hearing will likely determine the near-term status of both sites, and likely the entire DFS industry, in New York.