In a decision that feels just a bit ironic, the Nevada Gaming Control Board ruled daily fantasy sports sites like DraftKings and FanDuel are forms of gambling and will now require a license to function in the state.
As a result of this ruling, DraftKings and FanDuel have shut down operations in Nevada.
If those sites, and others that offer similar services, continue to operate without obtaining a gaming license, they will be slapped with fines, and their operators could receive 10-year prison sentences.
AG Burnett, chairman of the NGCB, said,
These [sites] are sports pools, which is when someone is in the business of accepting wagers on sporting events through any system or method of wagering. We have found that it is a wager, and obviously, it's on a sporting event, and [daily fantasy sports] companies are in the business of accepting those wagers.
In a statement, FanDuel said it's "terribly disappointed that the Nevada Gaming Control Board has decided that only incumbent Nevada casinos may offer fantasy sports."
Justine Sacco, director of communications for FanDuel, added,
This decision stymies innovation and ignores the fact that fantasy sports is a skill-based entertainment product loved and played by millions of sports fans.
We are examining all options and will exhaust all efforts to bring the fun, challenge and excitement of fantasy sports back to our Nevada fans. In the interim, because we are committed to ensuring we are compliant in all jurisdictions, regrettably, we are forced to cease operations in Nevada.
Despite some negative publicity and multiple lawsuits regarding the gaming sites' employees playing in the other site's fantasy pools, DraftKings and FanDuel had their best weeks of 2015 just last Sunday.
We'll have to wait and see how this latest blow impacts their numbers.