Daily fantasy sports site FanDuel said Tuesday it has stopped allowing New Yorkers to enter its games, though it hopes to be back in the state next week.
“FanDuel has always complied with state and federal law and we are going to continue to fight to ensure millions of New Yorkers have the right to play the fantasy sports games they love,” the company said in a statement. The company estimates that 10% of its players are from New York.
The move comes after New York Attorney General Eric Schneiderman filed suit against both FanDuel and rival site DraftKings Tuesday morning to shut the sites down in the state.
Schneiderman’s suit Tuesday argues that daily fantasy sports are illegal under the state’s gambling laws.
“While irresponsibly denying their status as gambling companies, the daily fantasy sports sites pose precisely the same risks to New York residents that New York’s anti-gambling laws were intended to avoid,” he argues in the suits.
Both DraftKings and FanDuel filed their own suits against Schneiderman on Friday, and filed motions Monday seeking to block Schneiderman from shutting them down in New York. Both companies are due back in court separately on Nov. 25 to argue their cases.
FanDuel said it hopes to open back up to New York players after that hearing.
“We look forward to the court vindicating our position next week,” it said.
Despite FanDuel’s retreat from the state, DraftKings is still taking bets from New York state residents.
“We are confident in our legal position, and look forward to our day in court next week,” DraftKings said Monday evening. According DraftKings, Schneiderman’s staff “assured the court he will take no action against DraftKings or its business partners before the [Nov. 25 hearing].”
The legal battle started Nov. 10 when Schneiderman sent a “cease-and-desist” letter to DraftKings and FanDuel demanding that the sites block New York players. But he needed court action to enforce his orders. His suit Tuesday represented that next step.
David Boies, a high profile attorney hired by DraftKings last week, argued in his motion Monday that Schneiderman’seffort to shut down daily fantasy sites in New York was unconstitutional.
He charges that Schneiderman and his office kept plans to shut down the games a secret from DraftKings despite a month of communication between his office and the companies. Boies says Schneiderman withheld that information so that DraftKings couldn’t challenge his action in court before it was announced.
Boies also argues that Schneiderman improperly singled out DraftKings and FanDuel for his action.
FanDuel argued in its motion that Schneiderman’s attempt to draw a distinction between daily fantasy sports games and those that take place over the course of a season has no basis in law.