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Entertainment and Sports Law Litigation

Second Circuit Rules on Fantasy Sports ‘Game of Skill’ Controversy

During the 2017 to 2019 baseball seasons, allegations were made that individual baseball clubs were engaged in electronic “sign stealing.” Shortly after this activity was acknowledged by Major League Baseball's Commissioner, a class action suit was filed, alleging that MLB made actionable misrepresentations that had an impact on the fantasy baseball games.

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Sports fans have enjoyed playing competitive games of fantasy sports for many years. In 2012, DraftKings was founded to serve these fans by operating daily and weekly fantasy sports contests on its website and mobile apps. One of its popular competitions is fantasy baseball, where baseball fans enter daily sports competitions with their own roster of major league players. To participate in these games the fans pay an initial fee to DraftKings. The participants accumulate fantasy points based on the performance of their lineup of players in real world games during a particular game or week. At the end of the contest, the fantasy player with the most accumulated points wins a cash prize. These fantasy competitions are defined as “games of skill” to avoid federal prohibitions against Internet gambling, Unlawful Internet Gambling Enforcement Act, 31 U.S.C. §5361 et seq. (https://bit.ly/36vsfTu).

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