Florida regulator issues cease-and-desist letters to Underdog Sports, PrizePicks and Betr

September 25, 2023
By

The FGCC Executive Director's letters cautioned three DFS operators that their paid fantasy sports games are 'offering or accepting illegal wagers.'

The Florida Gaming Control Commission (FGCC) has sent cease-and-desist letters to daily fantasy sports (DFS) operators Underdog Sports, PrizePicks and Betr. The parlay-prop-style games offered were said to be similar to sports betting, which at this time is not legal in the state.

According to local reports, the letters came after law enforcement raids on internet arcades in both Indian River and Manatee counties. No letters were sent to either market-leading fantasy sports operators FanDuel or DraftKings.

Sports betting was legalized in 2021 as part of a ‘hub-and-spoke’ gaming compact, offering the Seminole Tribe exclusive rights to operate it within the state. It was deemed that any mobile wagers, as long as they were placed via a server on Native American Tribal land, would constitute Tribal betting.

West Flagler Associates, which operates Bonita Springs Poker Room, filed a lawsuit saying this compact violated federal law, but this was overturned by a US Circuit Court of Appeals in June. After being denied a rehearing, West Flagler Associates now intends to take their claims to the US Supreme Court.

FGCC Executive Director stated within the letters that the three DFS operators could be “offering or accepting illegal bets or wagers” and may also be “promoting and conducting an illegal lottery” which is “strictly prohibited in Florida and constitutes criminal activity.”

Nicholas Green, General Counsel for Underdog Sports, wrote to Ross Marshman, General Counsel of the FGCC recently, “As you might imagine, my exec team asking what the letter means and seeking actionable advice, pretty urgently.

“Underdog operates multiple paid fantasy formats (season-long drafts, daily drafts, pick’em) and I just want to confirm my reading of the letter, which is that the legal conclusion applies to all paid fantasy contests — all of our contests — and not just particular types.”

Attorney John Lockwood, hired by multiple DFS companies, told the News Service of Florida, “The Commission staff confirmed to me that the language in the letter broadly applies to all paid fantasy sports contests, and they are not aware of any paid fantasy sports company operating legally in Florida.

“We disagree on the merits and will be working with the Commission, and potentially the Legislature, so we can ensure Florida sports fans can continue to play.”

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