Fantasy sites ask NY court to allow operations amid appeal

NEW YORK — Fantasy sports sites DraftKings and FanDuel have asked a state court to allow them to continue operating in New York as they appeal a lower court judge’s order to stop.

In court papers filed Monday in the State Supreme Court Appellate Division in Manhattan, the companies argued their businesses would suffer greatly if they were forced to prevent customers from playing fantasy before the case worked its way through the appeals process.

A lower court judge barred the companies from operating last month, siding with the state Attorney General Eric Schneiderman who has likened their businesses to illegal gambling operations. But after the companies appealed, an appellate judge stayed that order until the full panel of appellate judges could consider it.

Fantasy sports “have been offered openly, honestly, and permissibly in New York for nearly a decade; and if the NYAG had actual evidence that they caused public harm, he would have identified it in his brief,” wrote DraftKings attorney Randy Mastro wrote in a filing. “There is none.”

The full panel could rule on whether the companies can operate amid the appeals process in as few as two weeks, during the middle of the NFL football playoffs.

The companies argue their games are based on skill, not chance, and players pay entry fees in order to manage rosters like a general manager. But Schneiderman has countered that the games are highly dependent on factors out of their control — such as injuries or even the weather — and are thus ultimately based on chance.

“Like a sports bettor, a DFS player makes a wager that pays out depending on the performance of athletes on the field — events over which DFS players, like sports bettors, have no influence or control,” an assistant attorney general wrote in a memo to the appellate court submitted last week.