Rhode Island’s attorney general released an opinion that daily fantasy sports is likely legal under state law.
The news ends a recent run of AGs declaring that DFS is illegal in other states.
Rhode Island joins Massachusetts and Kansas in coming to the conclusion that paid-entry fantasy sports contests are legal. DFS is expressly legal in Nevada, as well, with a gaming license.
What the RI opinion says
The three-page letter from attorney general Peter Kilmartin notes that his office has “undertaken a review of the operation of ‘Daily Fantasy Sports’ ” in its civil and criminal divisions.
You can read the entire opinion here. From the opinion:
“Although we believe that DFS does implicate certain provisions of existing civil and criminal statutes, it is the opinion of this office that Daily Fantasy Sports may currently operate legally in the State of Rhode Island.
Recognizing that although the outcome of some games are purely based upon chance and others entirely on skill, it is clear that DFS, like most games, is a mixture of these factors. … The Supreme Court of Rhode Island has adopted the ‘dominant factor’ test to determine if chance exists in a lottery scheme …
Applying the ‘dominant factor’ standard, I do not believe that daily fantasy sports constitute a ‘game of chance’ and therefore, daily fantasy sports games to not constitute a lottery under Rhode Island law.
Kilmartin ends his opinion by imploring the state legislature to enact a law that regulates DFS in the state. He offered the assistance of his office in crafting legislation.
The opinion was sent to the state’s governor, the president of the state Senate, and the House speaker.
DraftKings and FanDuel statements
DraftKings counsel David Boies offered the following the opinion:
We agree with the Attorney General’s opinion that daily fantasy sports are games of skill and legal under Rhode Island law. And we are pleased that his legal opinion supports the view of certain other Attorneys General, experts, fans, and many policymakers that there is no legal distinction between season long and daily fantasy sports. We also agree that the legislature is the appropriate place for any additional regulation of fantasy contests. That is why we are working actively with legislators in Rhode Island and across the country to enact thoughtful and appropriate regulations that allow our fans to continue enjoying the contests they love.
FanDuel offered this statement:
Today, Rhode Island Attorney General Peter Kilmartin released his opinion stating daily fantasy sports are legal games of skill in the state, and noted consumer protection regulations should be established with legislation for fantasy sports put in place. We completely agree. FanDuel has been a vocal supporter of consumer protections and common-sense regulations for the fantasy sports industry and we are grateful for the Attorney General’s support. There is a movement towards regulating daily fantasy sports and establishing our game’s place in law in more than 20 state legislatures across the country. We will continue to work with lawmakers everywhere to establish laws the entire fantasy industry can adhere to.
The tally sheet for AGs on DFS
Rhode Island becomes the 13th AG to officially address DFS in some way. The negative opinions have outweighed the positive ones, so far:
DFS is illegal/gambling
- Illinois: AG Lisa Madigan tackled the issue with an advisory opinion in December that triggered a still-running court battle between her office and DFS operators.
- Nevada: An opinion from the office of AG Adam Laxalt in October came to the conclusion that DFS was gambling under state law and required a license to operate.
- New York: FanDuel and DraftKings recently won a stay of a preliminary injunction in their ongoing court battle with New York Attorney General Eric Schneiderman.
- Texas: Earlier in January, AG Ken Paxton issued an opinion saying that the courts would likely find that DFS is illegal gambling under state law. It does not appear he will take any imminent action.
- Vermont: The AG’s office in the New England state declared DFS is illegal gambling under state law. There has been no sense of what, if any, action the Vermont AG might take.
- Hawaii: AG Doug Chin offered an opinion much like the above states, saying DFS is illegal in the state.
- Mississippi: The office of AG Jim Hood recently declared DFS to be illegal gambling under state law.
DFS is legal, or something else
Those are just the opinions that were negative for DFS, however. Other AGs who have said something about DFS:
- Massachusetts: AG Maura Healey has stated publicly that she believes DFS is legal under state law. She has also proposed regulations that would govern the industry. She has also publicly says she believes DFS is gambling, in a casual definition.
- Kansas: The AG issued an opinion in April of last year, saying that fantasy contests are games of skill, in the context of a bill that was introduced and later became law. Daily fantasy, however, was not specifically addressed.
- Maryland: The AG’s office issued an opinion saying that a 2012 law that legalized fantasy contests possibly should have gone to a referendum. Brian Frosh’s office urged the legislature to take up the matter again.
- Florida: AG Pam Bondi has repeatedly deferred to the U.S. attorney’s office in Tampa, where a grand jury has reportedly considered DFS.
- South Dakota: AG Marty Jackley has commented on DFS, but what he will do, if anything, is unclear.