Were FanDuel and DraftKings daily fantasy sports contests illegal gambling in Illinois in 2015?
Plain-English summary
In late 2015, daily fantasy sports (DFS) operators FanDuel and DraftKings were national household names: paid entry, draft virtual rosters of real athletes, win money based on those athletes' actual statistics. Two Illinois state representatives chairing the House Judiciary Criminal Committee asked the AG whether the activity was gambling under Illinois law.
Attorney General Lisa Madigan answered yes. Section 28-1(a) of the Illinois Criminal Code defines gambling broadly to cover playing a game of chance for money. The "bona fide contests" exemption in section 28-1(b)(2) carves out genuine skill contests, but the AG concluded DFS contests turn on too many chance elements: which athletes get injured, weather conditions, opposing players' coverage, individual single-game statistical variance. While skill is involved in roster construction, the outcome of a particular contest depends substantially on chance. The exemption did not apply.
The opinion's practical effect: FanDuel and DraftKings operations in Illinois were illegal as configured, and continued operation exposed them to criminal liability. The opinion did not order them to stop, AG opinions are persuasive, not orders, but it set the stage for either litigation or legislation.
Currency note
This opinion was issued in 2015. Subsequent statutory amendments, court decisions, or later AG opinions may have changed the analysis. Treat this page as historical context, not current legal advice. Verify current law before relying on any specific rule, deadline, or remedy mentioned here.
Historical summary
What was at stake
Daily fantasy sports had grown from niche to multibillion-dollar industry by 2015. FanDuel and DraftKings dominated. Multiple state AGs across the country were taking positions: New York's AG had told them to stop in late 2015, leading to FanDuel v. Schneiderman and DraftKings v. Schneiderman litigation. Illinois lawmakers wanted to know where Illinois stood.
How the AG analyzed it
The AG worked through Illinois's gambling definitions. § 28-1(a) prohibits playing or betting on a game of chance for money or other thing of value. § 28-1(b)(2) exempts "the offer of free or paid entry into a bona fide contest for the determination of skill, speed, strength or endurance or to the owners of animals or vehicles entered in such contest."
Application to DFS: contestants pay entry fees and compete for predetermined cash prizes. Whether this is a "bona fide contest" of skill turns on whether skill predominates. The opinion took the view that a single contest's outcome depends heavily on game-day chance: an athlete tweaks an ankle in warmups, weather forces a quarterback to abandon his usual playbook, a star player sits because of a coach's decision. Even an extremely skilled DFS player could lose a particular contest to luck. Therefore the exemption did not cover DFS as offered by FanDuel and DraftKings.
What this meant at the time
DraftKings and FanDuel did not pull out of Illinois immediately. The AG's opinion is a persuasive document, not a self-executing prohibition. The companies and the AG entered into a period of negotiation and litigation pressure. Eventually, Illinois passed legislation regulating DFS rather than banning it outright, similar to the path taken by other states.
Common questions
Q: Did FanDuel and DraftKings have to stop operating in Illinois immediately after this opinion?
A: No. AG opinions are persuasive, not self-executing court orders. The opinion put legal pressure on the companies and gave law enforcement a basis for action, but actual enforcement required either a prosecution or further regulatory action.
Q: How is daily fantasy sports different from season-long fantasy?
A: Season-long fantasy plays out over months, smoothing out individual-game variance with many data points. Daily fantasy is one game or one slate of games, where chance has more impact relative to skill. The AG focused specifically on the daily format.
Q: Was the bona fide contest exemption never applicable to DFS?
A: The AG concluded it did not apply to FanDuel and DraftKings as configured in 2015. A different DFS structure, perhaps with longer duration or more skill-weighted scoring, might be analyzed differently.
Q: Is daily fantasy sports legal in Illinois now?
A: Illinois later passed legislation regulating sports betting and DFS. Current legality and licensing should be verified with the Illinois Gaming Board.
Background and statutory framework
The Illinois Criminal Code's gambling provisions, 720 ILCS 5/28-1, prohibit gambling broadly with specific exemptions. The bona fide contest exemption in subsection (b)(2) covers genuine skill, speed, strength, or endurance contests. Courts and AG opinions interpret the exemption narrowly to prevent gambling from being relabeled as a contest of skill.
The AG opinion was part of a national wave in 2015-2016 as states grappled with DFS classification. Some states banned, some regulated, some did nothing. Illinois eventually went the regulatory route.
Citations and references
Statutes:
- 720 ILCS 5/28-1(a) (gambling prohibition)
- 720 ILCS 5/28-1(b)(2) (bona fide contest exemption)
Cases:
- Langone v. Kaiser, No. 12-C-2073 (N.D. Ill. 2013)
Source
- Index page: https://illinoisattorneygeneral.gov/opinions/
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Index page: https://illinoisattorneygeneral.gov/opinions/
- Original PDF: https://illinoisattorneygeneral.gov/dA/c2ba85a417/2015%2015-006%20SPORTS%20AND%20GAMING%20Daily%20Fantasy%20Sports%20Contests%20Gambling.pdf
Original opinion text
OFFICE OF THE ATTORNEY GENERAL
STATE OF ILLINOIS
Lisa Madigan
ATTORNEY GENERAL December 23, 2015
FILE NO. 15-006
SPORTS AND GAMING:
Daily Fantasy Sports
Contests as Gambling
The Honorable Elgie R. Sims, Jr.
Chairperson, Judiciary - Criminal Committee
State Representative, 34th District .
8658 South Cottage Grove, Suite 404B
_ Chicago, Illinois 60619
- The Honorable Scott R. Drury
Vice-Chairperso teiary - Cri
State Represoritat istrict
You have inquired whether daily fantasy sports contests offered by FanDuel and
DraftKings (collectively Contest Organizers) constitute "gambling" under Illinois law. For the
reasons stated below, it is my opinion that the contests in question constitute illegal gambling
under subsection 28-1(a) of the Criminal Code of 2012 (the Criminal Code) (720 ILCS 5/28-1(a)
500 South Second Street, Springfield, Illinois 62706 © (217) 782-1090 © TTY: (217) 785-2771 © Fax: (217) 782-7046
100 West Randolph Street, Chicago, Hlinois 60601 © (312) 814-3000 © TTY: (312) 814-3374 © Fax: (312) 814-3806
1001 Ease Main, Carbondale, Illinois 62901 ¢ (618) 529-6400 © TTY: (618) 529-6403 © Fax: (618) 529-6416 ‘D+
The Honorable Elgie R. Sims, Jr.
The Honorable Scott R. Drury - 2
(West 2014)), and the exemption set forth in subsection 28-1(b)(2) of the Criminal Code (720
ILCS 5/28-1(b)(2) (West 2014)) does not apply.
BACKGROUND
The Contest Organizers are currently two of the most prominent companies
offering online daily fantasy sports contests. The term "fantasy sports contests" commonly refers
to contests involving virtual teams in which participants choose current athletes in a given
professional or college.sport to create a fantasy sports team and then compete against other
fantasy sports participants, with the winner or winners determined based on how those athletes
individually perform in their actual professional or college sports game. See generally Langone
v. Kaiser, No. 12-C-2073, 2013 WL 5567587 (N.D. Ill. October 9, 2013).
Unlike traditional fantasy sports contests, which operate on a season-long
timetable, daily fantasy sports contests are conducted over short-term periods, such as a week or
single day of competition. Participants who have created accounts with the Contest Organizers
pay an entry fee to participate in one or more of a Contest Organizer's fantasy sports contests! and
select a team of athletes in a certain sport under an imaginary "salary cap," a maximum budget to
'The Contest Organizers offer a number of different contest formats including leagues,
tournaments, head-to-heads, and multipliers. Leagues have a set number of entries allowed, while tournaments do
not have a cap on the number of entries. Most tournaments have guaranteed prize pools, where a prize is guaranteed
no matter the total number of entrants. In head-to-head contests, two participants compete against each other
directly. In multiplier contests, those in a certain top percentage of the total number of participants will win the same
amount. FanDuel Website, available at https://www.fanduel.com/how-it-works; DraftKings Website, available at
https://www.draftkings.com/help/faq.
The Honorable Elgie R. Sims, Jr.
The Honorable Scott R. Drury - 3
spend on athletes for the creation of a fantasy sports team.” The prizes are known in advance of
the playing of the actual games, and the prize values do not change based on the number of
entries in a particular contest. Participants earn fantasy points based on the statistical
performance of the athletes in the actual games. Depending on the athletes’ overall performance,
participants may win a share of the predetermined prize. Entry fees help fund prizes, with a
portion of the fees also going to the appropriate Contest Organizer. Complaint for Declaratory
and Injunctive Relief at 5-6, FanDuel, Inc. v. Schneiderman, No. 161691/2015 (N.Y. Sup. Ct.,
New York County); Verified Petition at 7-8, DrafiKings, Inc. v. Schneiderman, No. 102014/2015
(N.Y. Sup. Ct., New York County).
ANALYSIS
The Contest Organizers have suggested that their daily fantasy sports contests are
authorized under Federal law. The Professional and Amateur Sports Protection Act (PASPA)
(28 U.S.C. §3701 et seq. (2012)), which was enacted in 1992, makes it unlawful for "a person to
sponsor, operate, advertise, or promote * * * a lottery, sweepstakes, or other betting, gambling, or
wagering scheme based * * * on one or more competitive games in which amateur or
professional athletes participate[.]" 28 U.S.C. §3702 (2012). However, the Unlawful Internet
Gambling Enforcement Act of 2006 (UIGEA) (31 U.S.C. §5361 et seq. (2012)) was enacted after
2See FanDuel Website, available at https://www.fanduel.com/how-it-works; DraftKings Website,
available at https://draftkings.com/help/how-to-play. Both FanDuel and DraftKings offer free "contests." However,
this opinion addresses only those contests in which participants pay an entry fee.
The Honorable Elgie R. Sims, Jr.
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PASPA's passage and prohibits any person engaged in the business of "betting" from knowingly
accepting credit, electronic fund transfers, checks, or any other payment involving a financial
institution to settle unlawful internet gambling debts. 31 U.S.C. §5363 (2012). The UIGEA
excludes from the definition of "bet or wager" the participation in any fantasy sports game where:
(1) all prize amounts are made known before the contest begins; (2) all winning outcomes are
based on the relative skill and knowledge of the participants; and (3) no winning outcome is
based on the scores or performance of a single, real world event or the performance of any real
world team. 31 U.S.C. §5362(1)(E)(ix) (2012). The UIGEA specifically provides, however, that
"[nJo provision of this subchapter shall be construed as * * * limiting * * * State law * * * or
regulating gambling within the United States." 31 U.S.C. §5361(b) (2012). The UIEGA thus
leaves to each state the authority to determine whether daily fantasy sports contests which fall
under the UIEGA's requirements constitute illegal gambling.
In that regard, the online Terms of Use for FanDuel provide that individuals who
are physically located in Arizona, Iowa, Louisiana, Montana, Nevada, New York, or Washington
are not eligible to participate in contests. FanDuel Website, available at https://www.fanduel.
com/terms. Similarly, the online Terms of Use for DraftKings provide that legal residents
physically located in the foregoing states, with the exception of New York, are ineligible to
participate in contests. DraftKings Website, available at https://www.draftkings.com/help/terms.
It appears that the excluded states have gambling statutes that either expressly prohibit fantasy
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sports gambling (Mont. Code Ann. §23-5-802 (2015), available at http://leg.mt.gov/bills/
mca/23/5/23-5-802.htm) or internet gambling (La. Rev. Stat. §14:90.3 (2015), available at
http://www. legis.la.gov/legis/LawSearch.aspx; Wash. Rev. Code §9.46.240 (2015), available at
http://apps.leg.wa.gov/RC W/default.aspx?cite=9.46.240) or have been construed by State
enforcement authorities to prohibit fantasy sports contests (see Ariz. Att'y Gen. Op. No. 198-002,
issued January 21, 1998 (concluding that fantasy football constitutes gambling under Arizona
law); Memorandum from J. Brin Gibson, Bureau Chief of Gaming and Government Affairs and
Ketan D. Bhirud, Head of Complex Litigation, Office of the Nevada Attorney General, to A.G.
Burnett, Chairman, Nevada Gaming Control Board, Terry Johnson, Member, Nevada Gaming
Control Board, and Shawn Reid, Member, Nevada Gaming Control Board (October 16, 2015)
(concluding that daily fantasy sports constitute sports pools and gambling games under Nevada
law and therefore cannot be offered in Nevada without first obtaining a gaming license)).’ See
also 86" Iowa Gen. Assem., Senate File 166, 2015 Sess. (pending legislation proposing to add
"Fantasy or Simulation Sports Contests" to the list of lawful bona fide contests).
Additionally, on November 10, 2015, the New York Attorney General's Office issued cease and
desist letters to FanDuel and DraftKings, asserting that their operations constitute illegal gambling under New York
law. See Letter from Kathleen McGee, Chief, Internet Bureau, Office of the New York Attorney General, to Jason
Robins, Chief Executive Officer, DraftKings, Inc. (November 10, 2015); Letter from Kathleen McGee, Chief,
Internet Bureau, Office of the New York Attorney General, to Nigel Eccles, Chief Executive Officer, FanDuel Inc.
(November 10, 2015). That matter is currently in litigation. See note 10.
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In Illinois, the legality of daily fantasy sports is a matter of first impression.* The
Criminal Code prohibits the playing of both "games of chance or skill for money[.]"
Specifically, subsection 28-1(a) of the Criminal Code (720 ILCS 5/28-1(a) (West 2014)) defines
the offense of gambling and provides, in pertinent part:
‘There is one decision from a Federal district court in Illinois addressing daily fantasy sports
contests. In Langone v. Kaiser, the plaintiff brought a claim under section 28-8 of the Illinois Loss Recovery Act
(720 ILCS 5/28-8 (West 2012)) seeking, in part, to recover money from FanDuel and from an Illinois resident that a
third party allegedly lost to in a daily fantasy sports contest hosted by FanDuel. The court determined that "[t]he
relevant question for the purposes of the Loss Recovery Act is not whether FanDuel's activity is illegal; the question
is whether FanDuel is 'the winner’ with respect to any particular ‘loser."" Langone, 2013 WL 5567587, at *7. The
court held that because FanDuel does not risk its own money on the contests, it cannot be a winner or a loser under
the Loss Recovery Act. Because the court specifically declined to address whether daily fantasy sports contests
constitute illegal gambling under Illinois law, the case has no bearing on the instant inquiry.
We are also aware of four lawsuits pending in the Federal courts in Illinois involving DraftKings
and/or FanDuel. /zsak v. DraftKings, Inc., No. 14-cv-7952 (N.D. Ill. (2014)) (A class action alleging that
DraftKings violated the Federal Telephone Consumer Protection Act (47 U.S.C. §227 et seq. (2012)) by sending
unsolicited text messages to the cell phones of the plaintiff and the class members.); Hemrich v. DraftKings, Inc.,
No. 3:15-cv-445 (S.D. Ill. (2015)) (A class action alleging that DraftKings violated the Illinois consumer fraud
statute (815 ILCS 505/1 et seg. (West 2014)) and Missouri law by misleading consumers into believing that their
initial deposit would be doubled through a "100% First-Time Deposit Bonus" and seeking money damages in the
amounts of the doubled first-time deposits that the plaintiffs did not receive. The complaint specifically alleges that
"DraftKings' business is a legal one under United States law[,]" citing the Unlawful Internet Gambling Enforcement
Act of 2006 (31 U.S.C. §5362(1)(E)(ix) (2012). Hemrich Complaint at 4, 418.); Guarino v. DraftKings, Inc. and
FanDuel, Inc., No. 3:15-cv-1123 (S.D. Ill. (2015)) (A class action alleging that DraftKings and FanDuel fraudulently
induced plaintiff and the class members into paying money to participate by claiming the games were fair games of
skill without the potential for insiders to use non-public information to compete against them when, in fact, the
defendants willfully failed to disclose that employees of DraftKings and FanDuel had valuable, non-public data and
would use this information to compete against plaintiff and the class members. The complaint seeks a full refund for
all of the money paid to the defendants by the class members, damages and restitution, or other equitable relief. As
part of the allegations, the complaint states that daily fantasy sports contests are "not gambling because of the skill
involved in picking a winning team." Guarino Complaint at 6, { 29.); Stoddart v. DraftKings, Inc., No. 3:15-cv-
1307 (S.D. III. (2015)) (A class action brought on behalf of a plaintiff who participated in DraftKings' contests and
lost money and others similarly situated. The complaint alleges that DraftKings' daily fantasy sports contests are
illegal gambling under Illinois law and seeks an order requiring DraftKings to disgorge all of the money wagered and
lost by the plaintiff and the class members.). Only the Stoddart case raises the question of whether daily fantasy
sports contests violate Illinois criminal law. The court has not reached that issue, however. The case is currently
subject to an Order to Stay proceedings, pending the resolution of a Multidistrict Litigation transfer motion. Order,
Stoddart v. DrafiKings, Inc., No. 3:15-cv-1307 (S.D. Ill. December 16, 2015).
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(a) A person commits gambling when he or she:
(1) knowingly plays a game of chance or skill for money
or other thing of value, unless excepted in subsection (b) of this
Section;
(12) knowingly establishes, maintains, or operates an
Internet site that permits a person to play a game of chance or skill
for money or other thing of value by means of the Internet or to
make a wager upon the result of any game, contest, political
nomination, appointment, or election by means of the Internet.
This item (12) does not apply to activities referenced in items (6)
and (6.1) of subsection (b) of this Section.!”!
Subsection 28-1(b) of the Criminal Code (720 ILCS 5/28-1(b) (West 2014)) exempts certain
activities from the general prohibition on gambling. The Contest Organizers contend that the
following exception applies to the daily fantasy sports contests they offer:
(b) Participants in any of the following activities shall not
be convicted of gambling:
- OOK
(2) Offers of prizes, award or compensation to the actual
contestants in any bona fide contest for the determination of skill,
speed, strength or endurance or to the owners of animals or
vehicles entered in such contest.
5Subsections 28-1(b)(6) and 28-1(b)(6.1) of the Criminal Code (720 ILCS 5/28-1(b)(6), (b)(6.1)
(West 2014)) respectively exempt from the illegal gambling prohibitions lotteries conducted by the State of Illinois
in accordance with the Illinois Lottery Law (20 ILCS 1605/1 et seq. (West 2014)) and the online purchase of lottery
tickets for a lottery conducted by the State of Illinois under the program established in section 7.12 of the Illinois
Lottery Law (20 ILCS 1605/7.12 (West 2014)).
The Honorable Elgie R. Sims, Jr.
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The offense of gambling is a Class A misdemeanor under Illinois law. A second or subsequent
conviction under subsections 28-1(a)(3) through (a)(12) of the Criminal Code is a Class 4 felony.
720 ILCS 5/28-1(c) (West 2014).
The primary purpose of statutory construction is to ascertain and give effect to the
intent of the General Assembly. Illinois Department of Healthcare and Family Services v.
Warner, 227 Ill. 2d 223, 229 (2008). Legislative intent is best evidenced by the language used in
the statute, and where statutory language is clear and unambiguous, it must be given effect as
written. DeLuna v. Burciaga, 223 Ill. 2d 49, 59 (2006). One must view all of the provisions of
the statute as a whole. Land v. Board of Education of the City of Chicago, 202 Ill. 2d 414, 422
(2002). Words and phrases should not be construed in isolation, but interpreted in light of other
relevant portions of the statute. Land, 202 Ill. 2d at 422. Illinois criminal statutes must be
narrowly construed in favor of the accused. People v. Williams, 239 Ill. 2d 119, 127 (2010);
People v. Christensen, 102 Ill. 2d 321, 328 (1984).
Subsection 28-1(a)(1) of the Criminal Code provides that a person commits the
offense of gambling when he or she "knowingly plays a game of chance or skill for money[,]"
unless excepted in subsection 28-1(b). The statutory language is straightforward and
unequivocal. It clearly declares that all games of chance or skill, when played for money, are
illegal gambling in Illinois, unless excepted. While the Contest Organizers assert that daily
The Honorable Elgie R. Sims, Jr.
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fantasy sports contests are games of skill® rather than games of chance, that argument is
immaterial because subsection 28-1(a)(1) expressly encompasses both. Moreover, participants
must pay an entry fee or buy-in amount in order to win a prize. Consequently, the act of playing
daily fantasy sports contests in Illinois constitutes illegal gambling under subsection 28-1(a)(1) of
the Criminal Code, unless otherwise excepted.
Pursuant to subsection 28-1(a)(12) of the Criminal Code, a person also commits
gambling when he or she "knowingly establishes, maintains, or operates an Internet site that
permits a person to play a game of chance or skill for money or other thing of value by means of
the Internet or to make a wager upon the result of any game[.]" The Contest Organizers operate
websites that allow individuals to play games of chance or skill for money. Accordingly, entities
which operate such contests commit the offense of gambling under Illinois law, unless otherwise
excepted. See Cie v. Comdata Network, Inc., 275 Ill. App. 3d 759, 764-65 (1995), appeal
denied, 165 Ill. 2d 548 (1996) (subsection 28-1(b) exceptions apply to all gambling prohibitions
in subsection 28-1(a)).
Subsection 28-1(b) of the Criminal Code sets out the only exceptions to activities
that otherwise would constitute gambling under subsection 28-1(a). The Contest Organizers .
assert that their contests are excepted under subsection 28-1(b)(2). This subsection was included
in the original enactment of article 28 of the Criminal Code of 1961 (see 1961 Ill. Laws 1983,
®See FanDuel Website, available at https://fanduel.zendesk.com/hc/en-us/articles/
210202858-Is-FanDuel-legal; DraftKings Website, available at https://www.draftkings.com/help/why-is-it-legal.
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2033-37; Ill. Rev. Stat. 1961, ch. 38, par. 28-1 ef seq.) and exempts "[o]ffers of prizes, award or
compensation to the actual contestants in any bona fide contest for the determination of skill,
speed, strength or endurance or to the owners of animals or vehicles entered in such contest."”
(Emphasis added.)
Reading the statute as a whole, it is clear that subsection 28-1(b)(2) applies only to
the "actual contestants" in the actual sporting event.® In the context of daily fantasy sports, the
"actual contestant" upon whose performance success or failure is based is the athlete or athletes
whose "skill, speed, strength or endurance" determine the outcome. Thus, subsection 28-1(b)(2)
exempts only those who actually engage in a bona fide contest for the determination of skill,
speed, strength, or endurance, and not a daily fantasy sports contest participant who pays a fee to
build a "team" and who may win a prize based on the statistical performance of particular
athletes. In this regard, persons whose wagers depend upon how particular, selected athletes
perform in actual sporting events stand in no different stead than persons who wager on the
outcome of any sporting event in which they are not participants. None of these persons are the
"There is only one Illinois case which cites to this exception. In People v. Mitchell, 111 Ill. App.
3d 1026, 1028 (1983), the court upheld a jury's conclusion that "Hold 'em" poker was not a "bona fide contest for the
determination of skill" under subsection 28-1(b)(2). The court held that the evidence supported the jury's conclusion
that "the games, in fact, required a combination of skill and chance, and that they were definitely not the type of
‘bona fide contests' excepted from subsection 28-1(1)." (Emphasis in original.) Mitchell, 111 Ill. App. 3d at
1028.
®The Contest Organizers have not suggested that daily fantasy sports contests involve determining
the speed, strength, or endurance of the fantasy sports participants who enter the contests, nor could such a
suggestion be made in good faith.
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actual contestants in a bona fide contest for the determination of skill, speed, strength, or
endurance.
This interpretation is consistent with a 1994 opinion of the Texas Attorney
General's Office construing substantially similar statutory language to that found in subsection
28-1(b)(2) of the Criminal Code. Tex. Att'y Gen. Op. No. LO-94-051, issued June 9, 1994. In
that opinion, the Texas Attorney General's office addressed whether a contest which requires an
entry fee, pays prizes to winners, and is based on forecasting the outcomes of a number of
sporting events constitute illegal gambling under Texas law.’ The Texas Attorney General's
Office concluded that the contest at issue did not fall within the gambling exception and
therefore constituted illegal gambling:
We cannot think of any distinction the words "actual contestants"
could be intended to make other than that between those actually
participating in a contest and able by their performance to affect its
outcome, and those merely betting on it. Thus, while the
subsection (1)(B) exclusion may embrace athletes actually
competing in the sporting events you refer to, it does not embrace
*See Texas Penal Code §47.01(1)(B) (2015), available at http://www.statutes. legis.state.
tx.us/docs/PE/pdf/PE.47.pdf, which provides, in pertinent part:
(1) "Bet" means an agreement to win or lose something of value solely
or partially by chance. A bet does not include:
- Ox
(B) an offer of a prize, award, or compensation to the actual
contestants in a bona fide contest for the determination of skill, speed, strength,
or endurance or to the owners of animals, vehicles, watercraft, or aircraft entered
in a contest[.]
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those who pay entry fees for a chance to win a prize from
forecasting the outcome of the events. (Emphasis in original.)
Tex. Att'y Gen. Op. No. LO94-051 at 2.’°
Although daily fantasy sports contests may involve some degree of skill, such as
selecting an athlete for a participant's team based on knowledge of the athlete's historical
The New York Supreme Court recently made this same distinction when granting the New York
Attorney General's motions to enjoin the Contest Organizers from accepting entry fees from New York State
consumers for any daily fantasy sports contests which they operate, pending a final determination. See Decision and
Order for Injunctive Relief, People ex rel. Schneiderman v. DraftKings, Inc., No. 453054/2015 (N.Y. Sup. Ct., New
York County, December 11, 2015); Decision and Order for Injunctive Relief, People ex rel. Schneiderman v.
FanDuel, Inc., No. 453056/2015 (N.Y. Sup. Ct., New York County, December 11, 2015) (Decisions and Orders).
New York law defines "gambling" as follows:
A person engages in gambling when he stakes or risks something of value upon
the outcome of a contest of chance or a future contingent event not under his
control or influence, upon an agreement or understanding that he will receive
something of value in the event of a certain outcome. (Emphasis added.) N.Y.
Penal Law §225.00(2) (2015), available at http://public. leginfo.state.ny.us/
lawssrch.cgi7NVLWO:.
The New York Attorney General argued that the participants paid entry fees "on events they cannot control or
influence, relying on the real-game performance of professional athletes, to win a prize, which amounts to gambling"
under New York law. Decisions and Orders, at 5. The New York Attorney General further argued that daily fantasy
sports contests are "contests of chance” because the outcome depends substantially on chance and factors not within
the participant's control, and that once a team is chosen for a contest, there is no means of altering the outcome.
Decisions and Orders, at 6. The court concluded that the language of the statute "is broadly worded and as currently
written sufficient for finding that DFS [daily fantasy sports] involves illegal gambling." Decisions and Orders, at 7.
The Contest Organizers immediately appealed the court's decision. Notice of Appeal, People ex rel. Schneiderman
v. DraftKings, Inc., No. 453054/2015 (N.Y. Sup. Ct., New York County, December 11, 2015); Notice of Appeal,
People ex rel. Schneiderman v. FanDuel, Inc., No. 453056/2015 (N.Y. Sup. Ct., New York County, December 11,
2015). The New York Supreme Court, Appellate Division granted an interim stay of the enforcement of the
injunction against FanDuel pending a determination by a full panel. Notice of Entry of Appellate Division Interim
Stay Order, People ex rel. Schneiderman v. FanDuel, Inc., No. 453056/2015 (N.Y. Sup. Ct., New York County,
December 11, 2015).
Additionally, the Kansas Legislature recently amended its gambling statute, which contains a
substantially similar exclusion for "offers of purses, prizes or premiums to the actual contestants in any bona fide
contest for the determination of skill, speed, strength or endurance or to the bona fide owners of animals or vehicles
entered in such a contest[,]" to also exclude "a fantasy sports league as defined in this section[.]" Kan. Stat. Ann.
§§21-6403(a)(2), (a)(9) (2014), as amended by 2015 Kan. Sess. Laws 835-38, available at http://www.sos.ks.gov/
pubs/sessionlaws/2015/2015_Session_Laws_Volume_1.pdf.
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performance, match-up against a particular opponent, performance in a particular venue, and/or
performance in particular weather conditions, the phrase "actual contestants" as used in
subsection 28-1(b)(2) does not apply to those persons who pay entry fees for a chance to win a
prize for forecasting the performance of professional or college athletes over whom they have no
control or influence. Accordingly, it is my opinion that subsection 28-1(b)(2) does not exempt
daily fantasy sports contests from the Illinois gambling provisions.
CONCLUSION
It is my opinion that the daily fantasy sports contests offered by FanDuel and
DraftKings clearly constitute gambling under subsection 28-1(a) of the Criminal Code of 2012
and that the exemption set forth in subsection 28-1(b)(2) of the Criminal Code does not apply.
In closing, I note that there is legislation currently pending in each chamber of the
Illinois General Assembly which proposes, in part, to create a new Act — the Fantasy Contests
Act — and to exempt "fantasy contests as defined under the Fantasy Contests Act" from the
general prohibition against gambling. See 99" Ill. Gen. Assem., House Bill 4323, Senate Bill
2193, 2015 Sess.'! Thus, it appears that a number of General Assembly members have reached
this same conclusion, as they have agreed to sponsor the foregoing legislation. Absent legislation
"House Bill 4323 was referred to the House Rules Committee on November 9, 2015. Senate Bill
2193 was referred to the Senate Assignments Committee on November 3, 2015. Previously-filed legislation
proposing to create the Daily Fantasy Sports Regulation Act contained only a short title provision and was referred
to the House Rules Committee on April 14, 2015. See 99" Ill. Gen. Assem., House Bill 4200, 2015 Sess.
The Honorable Elgie R. Sims, Jr.
The Honorable Scott R. Drury - 14
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specifically exempting daily fantasy sports contests from the gambling provisions, it is my
opinion that daily fantasy sports contests constitute illegal gambling under Illinois law.
Very truly yours,
(ti .
LISA MADIGAN
ATTORNEY GENERAL