cease and desist letter to draftkings

8/20/2019 Cease and desist letter to DraftKings

1/11

DEPARTMENT

OF

THE PROSE UTIN ATTORNEY

ITY

ND OUNTY

OF HONOLULU

ALII PLACE

1060 RICHARDS STREET

• HONOLULU. HAWAII

96B13

PHONE (8061 768 7400 • FAX: (BOS) 768 751S

KEITH M KANESHIRD

PBOShCUTINnATIOFlNtY

Mr. J as on Robi ns

Chie f

Executive Officer

DraftKings. Inc.

376 Boylston Street. Ste. 501

Boston.

MA 02116 3825

Dear

Mr . Robins :

February 1. 2016

ARMINA A.

HINS

FISSTOEPOTV

PaOSSCirTlNG

AnoBNEY

This letter constitutes a demand thai DraftKings. inc. ( DraftKings ) immediately cease

and desist from accepting wagers from residents of the City and County of Honolulu in

connection with daily fantasy .sportscontests.

Gambling is illegal in Hawaii, and on January 27, 2016, the state Attorney General issued

a formal advisory opinion conrirming what I have long believed: Tliat daily fantasy sports

contests are a form of gambling and violate Hawaii statutes.

While DraftKings

repre sent s

that its contests are games of skill because players select

their lineups. Hawaii law specifically states that

a

contest

of

chance means any contest, game,

gaming scheme, or gaming device in which the outcome depends in a material degree upon an

element of chance, notwith.standing that skill of the contestants may also be a factor therein.

The law goes on to say that a person engages in gambling if he states or risks .something

of

value upon the outcome

of

a contest

of

chance

....

Further, by advancing a contest

of

chance, accepting wagers from Oahu residents and

profiting from those payments, DraftKings is promoting gambling under Hawaii

l w s

Like lawmakers and law enforcement in close to a dozen states, I reject the notion that

the 2006 Unlawful Internet Gambling Enforcement .Act

exempts

fantasy sports contests from

state laws as it does not define what constitutes gambling. Hawaii s gambling laws are clear and

DraftKings is in violation of those laws.


2/11

M r Ja son R ob ins

February 1 2016

Page 2

Therefore, as Prosecuting Attorney for the City and County of Honolulu, I must demand

that DraftKings immediately halt accepting wagers from Oahu residents and refrain from doing

further business on Oahu

Attachments 2

Sincerely,

KEITH M KANESHIRO

Prosecuting Allorney


3/11


4/11

The

Honorable

Rosalyn H Baker

Janua ry 27, 2016

Page

S t a t . § 712-1220

(2014) .

Al t e rna t i ve l y , th e

con t e s t s

invo lve

fu tu r e c on tin ge n t e ve nts

because

they

depend

on th e ac t i ons o f

a th le te s e n ti re ly

ou t s ide

th e pa r t i c i p a n t s ' in flu en ce o r con t ro l .

Id

I BACKGROUND.

A. T r a d i t i o n a l Fan t a sy League s v s . D a ily F an ta sy Spo r t s

Contests

We unders tand near ly s ix ty mi l l i on

Americans

pa r t i c i pa t e

in

fan tasy

spo r t s ,

with the va s t

ma jor i ty

p lay ing th e

t r ad i t i ona l

va r i e t y . Trad i t i on a l

f an tasy

s po r t s l eagues—usual ly organ ized

between a group

o f

f r i ends

o r

co l l eagues—cons i s t

o f

r e gu l a r f ans

o f

a

pa r t i c u l a r

spo r t

who

each own

t h e i r f an tasy teams.

Each team

i nc ludes

a r o s t e r

o f i n d i v i dua l s

p lay ing th e

s po r t in

r e a l

life

t y p i c a l l y by way o f a d ra f t

a t

th e beginning o f

the

season .

Po in t s

a re

awarded

each

week based

on

th e combined

per fo rmances

o f

those a t h l e t e s .

A ll

th e teams in a l e ague a re p a ire d up each week

and

th e

team

with th e

h ighe r combined

sco re

wins

th e matchup.

Lineups

can be a l t e r ed by

t r ad in g p la ye rs

or u sing a

wa ive r wire

to

p ick up

r emaining

f r e e a ge nts .

At

th e end o f th e a t h l e t i c

season ,

th e team with th e

b e s t r eco rd wins

th e l e ague .

Unl ike t r a d i t i o n a l

f an tasy

s po r t s

l e agues , da i l y

f an t a sy

s po r t s

con t e s t s i nvo lve compe t i t ions between hundreds o r t housands

o f

peop le

and

a re

p layed

da i l y . Any p l aye r

can

pu t

any

a t h l e t e

on to h is o r he r t eam, and each a t h l e t e can be p icked up an

un l im i t ed number

o f t ime s . In s t e ad o f a

d r a f t

a t th e

beg inn ing

o f

th e

s e a s on ,

a per son can d r a f t a

new t eam each day

f o r a

wager

(o r

buy- in ) . The

goa l in a

da i l y

fan tasy spo r t s

con t e s t i s

to p ick

th e h igh es t

sco r ing

p l aye r s who

co s t th e

l e a s t

in

o rde r

to

n e t th e

mos t po in t s

ov e r a l l .

The

f r equency

in which an owner wins o r l o s e s

a cash p r i z e i nc rea s e s to d ai ly , because

an owner p lays

in a

new

league

eve ry day.

See

Michae l Tr ipp i ed i , Dai ly Fantasy

Spo r t s

Leagues : Do

You

Have th e Sk i l l t o Win a t These

Games

o f Chance? , 5

UNLV Gaming L . J . 201,

203-204

(Fa l l 2014) .

The

amount

o f money

i nvo lved

d i f f e r s

t r emendous ly

between

t r a d i t i o n a l and da i l y f an ta sy

s p o r t s .

While t h e r e

a re

v a r i e t i e s o f

t r a d i t i o n a l

l eagues ,

they of t en

i nvo lve

around twelve

p laye r s

and a

buy

in

o f a round 50, l e ad i ng to

a

total po t o f a round 600 .

Dai ly

f an tasy

s po rts c on te sts , by con t r a s t , a l low wagers o f up t o

1 ,000 ,

invo lve

t housands

o f p laye r s a t a t ime , and a l low

each

i nd iv id u a l m u l ti pl e

en t r i e s l ead ing to top

p r i z e s

o f up to 1

mi l l i on . The high s takes and rap id rewards o f da i ly fan tasy spo r t s

Op. No. 16-1


5/11

The

Ho no ra ble R o sa ly n H

Baker

January

27,

2016

Page

con t e s t s

resemble

poker

more

than

t r ad i t i ona l

fan ta sy

leagues ,

and

t h i s resemblance

is no a c c i d en t

as th e

da i l y

f an t asy i ndus t ry

grew

ou t o f th e rubb le o f o nl in e p ok er . Jay Caspian Kang,

How th e

D aily F an ta sy

Spo r t s I n d u s t r y

Turn s

Fans

i n t o

Sucke r s ,

N.Y.

Times

Mag., Jan .

6,

2016, ht tp : / /www.nyt imes .eom/2016/01/06/

magaz ine /how- the -da i l y - f an t a sy - spo r t s - i ndus t ry - t u rn s - f an s - i n to -

sucke r s . h tm l . Dai ly f an t a sy

s po rts c on te st s were

c r a f t ed

to comply

wi th

th e f ede ra l

Unlawful I n t e r n e t Gambling Enforcement

Act

(UIGEA)

t h a t had shu t t e r ed on l i ne poker s i t e s bu t spe c i f i c a l l y exempted

f an t asy

s po r t s .

See

31 U.S.C.A.

§ 5362(1)

(E) ( ix)

(West 2016) . The

UIGEA

is c l e a r t h a t

none o f its p rov i s i ons

shou ld

b e cons t rued

as

a l t e r i n g , l im i t i ng , o r e xten din g any Federa l o r St a t e law

p roh i b i t i n g ,

pe rmi t t i ng ,

o r

r egu l a t i ng

gambling w ith in th e Uni ted

S t a t e s . 31 U.S.C.A. § 5361(b) (West 2016) . Thus th e l e ga l i t y

o f

da i l y

f a n t a sy

s p or ts c on te st s

is

a

ma t t e r

o f s t a t e l aw .

B.

A Br i e f His to ry o f

Haw a i i s

Gambling Laws.

Gambling, in one form

o r

ano th e r ,

has

been

i l l e g a l

in

Hawai i

s i n c e a t l e a s t

1850 .

See

The

King v .

Yeong Ting ,

6 Haw. 576 ,

577

(1885).

In

1893,

th e P ro vis io n al Government

passed a

law ou t l awing

many s p ec i f i c

types o f

gambl ing and

any o the r

game in which

money

o r

any t h i ng o f

va l u e is

l o s t

o r won. 1893

Haw.

Se s s .

L.

Act

21 .

This

law

rema ined in

fo rce fo r

n ea rly e ig hty yea rs un t i l

r ep l aced

by th e cu r r en t , more comprehensive

scheme

with

th e

adop t ion o f th e

Hawa i i

P e n a l

Cod e in

1 9 7 2 . 1 9 7 2

Haw.

ess

L . A c t

9 .

The

commentary

to th e cu rr en t

law

no t e s

t h a t

f o r th e

most

pa r t , th e

coverage of

th e

prev ious

law

has been prese rved , a l though th e

em phasis has been changed in s eve ra l i n s t ances . Haw. Rev. S ta t .

§§

712 -1 221- 1223 cmt .

(2014) . While th e gambl ing

prov i s ions

were

pa t t e rned on t hose proposed in

Michig an and adopted

in

New

York,

Hawai i t ook a more c au t i ou s

approach

t han

t h o s e two s t a te s . I d .;

Leg i s l a t i v e Reference

Bureau, Hawaii

Penal Code

22-23

(1970)

( r e f e r r i ng s p ec i f i c a l l y to Hawa i i s s o c i a l gambl ing a f f i rma t i v e

d e f e n s e ) .

Accord ing

to th e Confe rence Commit tee

Repor t

on

th e bill

adop t ing

th e Code,

The

ba s i c

t h r u s t

o f gambling o f f ense s o f

( t h e

proposed

Code]

i s

to

impose heavy

pena l t i e s

on

va r iou s fo rce s o f

i n s t i t u t i ona l i z ed

gambl ing

and

a t th e same t ime

to

r e cogn ize t h a t

soc i e t y

no

l onge r

condemns

as

c r im ina l ,

c a sua l

gambl ing

in a s o c i a l

con t ex t . Conf .

Comm

Rep. No. 1-72 ,

in

1972 Sena t e

Jou rna l ,

a t

739 .

I ndeed ,

it was t h e i n t e n t i o n

o f

th e

Confe r ence

Commi t t e e

t h a t

th e gambl ing s ec t i on

p rec lude

a n igh tc lub , ho te l , bar , r e s t au ran t ,

o r

any

o t h e r

bus i ne s s in

i n t e r s t a t e

commerce from p rov id ing

any

accommodation fo r th e promot ion o f any form o f

gambl ing .

Id .

Op. No.

16-1


6/11

T he H o n o r a b l e R o s a l y n H

B a k e r

Janua ry 2 7 , 2 0 1 6

P a g e 4

emphases

a d d e d ) .

Rela t ive ly fe w cases h a v e i n t e rp re t ed th e

current

law

W h i le

n o n e

of

these mod e r n cases

h a v e cited decisions

u n d e r

th e pre viou s law

as

per suas ive ,

ne i t he r h a v e any denied

t h e i r

pe r s ua s iv e

e f f e c t .

II

ANALYSIS .

A. Dai ly f a n t a s y spo r t s b e t t i n g i s g amblin g u nd er Hawai i

law

In the a b s e n c e

of a

spec i f i c exc lu s ion

o r defense ,

g a m b l i n g i s

p ro hib ite d in

th e S t a t e o f Hawai i . Haw. Re v. S t a t . §§

7 1 2 - 1 2 2 0

e t

seq .

The

ac t i v i t y

involved in da i ly

f an tasy

spo r t s

be t t i ng

i s

gambling under th e p l a i n meaning of Hawaii s

gambling

s t a t u t e . ^

Thi s

s t a t u t e

s e t s ou t

t h r ee

m a i n r equ i r emen t s to m e e t

th e

de f i n i t i o n

o f g ambl ing

num be r s

added) :

A p e r s o n

e n g a g e s in

g a m b l i n g if

[1 ]

h e [ o r s h e ] s tak e s o r

r i s k s

someth ing o f

va lue [2] u p on th e

o u t c o m e

o f a

con t e s t o f

chance o r a fu tu re con t ingen t even t

no t

under h is

con t r o l

o r

i n f l u ence ,

[3 ]

upon

a n

agreemen t o r u nd ers ta nd in g t h a t h e o r

s o m e o n e

e l s e w il l r e c e iv e someth ing

o f va lu e

in

th e even t o f a

certain o u t c om e .

Haw

Rev. Stat .

§

712-1220

2014).^

Dai ly

f an tasy

spo r t s be t t i ng

m ee ts e a c h

of th ese

r equ i r emen ts .

We add r e s s th e first and t h i r d prongs

her e

a n d th e

se co nd p ron g

( con t e s t

o f

chance o r f u t u r e con t i ngen t

event )

i s addres sed b e l o w .

As to th e first

prong ,

th e

a m o u n t

w a g e r e d

o n each

da i l y

f an ta sy

spo r t s

con t e s t

i s

someth ing o f

va lue

t h a t i s

being s t ake [d ]

W h e t h e r f u r t h e r grounds

e x i s t

fo r c r im ina l o r c i v i l

enfo r cemen t

a n d to

w h a t

ex t en t

wi l l

d e p e n d

o n

th e pa r t i cu l a r

facts of each case

^ T he de f i n i t i o n s

s ec t i on

a l so

s t a t e s :

G a m bl i ng does

no t

i n c lude b o n a f ide bus ines s

t r a n s a c t i o n s v a l i d unde r th e law

o f

c o n t r a c t s ,

in c lu d in g bu t no t l im i t ed

to con t r a c t s

fo r th e

purchase o r s a l e

a t

a fu tu re da te o f s e c u r i t i e s

o r

commodi t ie s ,

a n d

agreements

to

c o m p e n s a t e fo r l o s s

caused

b y th e happening o f

chance ,

inc lud ing bu t

no t

l im i t ed

to con t r a c t s

o f i ndemni ty o r

gua ran ty a n d

life h e a l t h , o r a cc id e nt in su ra n ce .

H a w . Rev .

Stat

§

712 -1220

( 2 014 ) .

Op. No.

16-1


7/11

The Ho no ra ble R o sa ly n H. Baker

Janua ry

27,

2016

Page 5

desp i t e be ing ca l l e d an en t ry

f ee . Under Hawa ii s p re vio u s

g amblin g law , th e

Hawai i Supreme

Cour t ru led

t h a t

such

a p l ay i ng

f e e was

a s tak e in th e outcome o f a

game.

See

St a t e

v . Prevo ,

44

Haw.

665,

677,

361

P.2d

1044,

1051 (1961)

( Every

p l aye r

o f

F a sc i na t i on pays a play ing fee o f

ten

cen t s .

It

i s obvious from

th e

cha r ac t e r

o f the game t h a t each p la ye r s ta ke s

h is

fee on a

chance

o f winning someth ing o f

va lue , be

it a

p r i z e

o r a f ree

game. ) . As fo r the

t h i rd

prong,

both major

da i l y

fan ta sy

spo r t s

companies

la y

ou t

in

de t a i l

what p l aye r s

wi l l

rece ive

on

th e

ba s i s

of

certain

outcomes.^

Furthermore, as examined below, a daily

f an t asy

spo r t s

con t e s t i s a c o n t e s t

o f

chance o r

i nvo lve s a

f utu re c on tin ge nt even t no t

under

[a p l a y e r s )

co nt ro l o r

i n f l uence .

Haw.

Rev. S t a t . § 712-1220. By

s t a t u t e

an a c t i v i t y

con s t i t u t e s

gambl ing

if e i t h e r r equ i r emen t i s met ; in our view,

da i l y

fan ta sy

spo r t s c on te sts q u al i f y

under both . This i s

discussed b e l ow .

1 . Da i l y

f a n t a s y

s po r t s c on te s t s a r e con t e s t s

o f

chance.

Dai l y fa nta sy s po rt s con t e s t s a re con t e s t s o f

chance

unde r

Hawai i

law,

which

de f i ne s them a s any

con t e s t , game,

gaming

scheme, o r gaming

dev ice in

which th e outcome depends in a

mat e r i a l

degree upon an e l emen t o f

chance ,

no tw i t h s t a nd ing t h a t s k i l l

o f th e

con t e s t a n t s may a l s o be a f a c t o r t h e r e i n . Haw.

Rev.

S t a t . § 712-

1220

(2014) .

No Hawai i cou r t

has

i n t e r p r e t ed

th e

ph ra se

m a t e ri a l

degree

upon an

e l emen t

o f chance .

The

appe l l a t e cou r t s

in

two

s t a t e s

with

th e

same

s t a t u t o ry l anguage—Nebr aska and New

York-

de f i ne

ma t e r i a l

to mean p redom inan t . Am Amusements Co. v .

Neb.

Dep t

o f Revenue , 807 N.W .2d 492 ,

502

(Neb. 2 01 1) ; P eop le v .

L i Ai

Hua,

24 Misc . 3d 1142 , 1145 (N.Y.

Crim.

C t .

2009 ) .

But

an

appe l l a t e

cou r t

in

Missou r i he ld t h a t

whi le c hance

must

be a

ma t e r i a l e l emen t in

de t e rmin ing

th e outcome

[ijt

need no t be

th e dominan t e l emen t .

Tho le

v .

W es t f a ll , 682

S .W.2d 33 , 37

n .8

See

Terms

of Use,

https://www.draftkings.com/help/terms

( l a s t v is it e d Jan . 27 , 2016)

( Con t e s t

r e s u l t s and

p r i z e

ca l cu l a t i on s

a re based

on

th e

f i n a l

statistics

and

scor ing

r e s u l t s a t

th e

comple t ion o f

th e l a s t

p ro f e s s i on a l spo r t s game

of e a c h individual Contest. Once Contest

results

are r e v i ew e d

and

graded , p r i z e s

a re

awarded . ) ; Terms

o f

Use,

h t tp s : / /www. fandue l . com/ te rms

( l a s t v is it e d

Jan .

27, 2016)

( The

p l aye r s

in

each con t e s t

who accumula te th e most f an t asy

po in t s

and comply with

e l i g i b i l i t y

requ i rements and app l i c ab l e

r u l e s wi l l win p r i z e s as s e t ou t

in

th e pos ted con t e s t

details. .

Op.

No.

16 -1


8/11

The Hono ra bl e Ro sa ly n

H.

Baker

Janua ry

27,

2016

Page 6

Mo.

C t.

App.

1984)

(emphasis omi t t ed ) . As di scussed below, under

e i th e r i n t er p re ta t i on ,

da i l y

f an t a sy s po rt s c on te sts

a re

c on t e s t s

of

c h an ce u n de r H aw ai i law

b e c a u s e

c h a n c e is a material e l em e n t

fo r

th e

va s t

m ajo ri ty o f

p l aye r s .

In

St a t e v. Prevo ,

th e Hawai ' i Supreme

Cou rt u ph eld

th e

c on vic tio n o f

a

p l aye r

o f th e game F a s c i na t i on de s p i t e her

argument t h a t th e game was one o f s k i l l .

Sta t e v.

Prevo,

44 Haw.

665 361

P.2d

1044

(1961).^

The

Court

concluded

that :

'gambling'

i s an

appropr i a t e

cha rac t e r i za t i on

o f th e conduct o f

some

o r most

o f th e

pa r t i c i p an t s

in th e games

. . . no tw i t h s t a nd ing

t h a t

some

o f

th e p lay er s

may

be deemed

so s k i l l e d

a s no t

to

be gambl ing . Id .

a t

677,

361

P.3d

a t

1051. Accord ing to

t h e

Cour t :

[T]he t e s t o f

whe the r

a

game

i s

one o f

s k i l l o r

o f chance ,

o r

one

in which skill g r ea t l y p red om in ate s o ve r ch an ce , i s no t to

be measured

by th e s tan da rd

o f exp erts o r any

l imi ted

c l a s s o f

p l aye r s ,

bu t by

t h a t o f th e average

s k i l l

o f

a

major i ty o f

p l aye r s

l i k e ly to

play th e

game,

fo r the

purpose i s to

de t e rmine th e pr imary

ob j e c t

o f

th e game and t h i s i s one o f

the

ways o f do ing

so .

Id . a t 675-76 ,

361

P.3d a t 1050 ( c i t i ng Ruben v . Keuper ,

127

A.2d

906 (N.J .

Super .

C t.

Ch.

Div. 1956 ) ) .

For th e t i ny m in or i ty o f t op -pe r fo rming p l aye r s , skill makes

a

r ea l d if fe re n ce

in

da i l y

fan ta sy spo r t s

con t e s t s .

But

fo r

th e

va s t

major i ty o f p la ye rs , chance predominates . See, e .g . , Aff . o f

Zvi

Gi lu l a a t 5,

People v . D ra f tK ing s, I n c . , Index No.

453054/2015

(N.Y. Sup . C t. Nov. 24,

2014) ,

NYSCEF

Doc. No. 104 (no t ing t h a t th e

t yp i ca l c l i e n t p lay ing

Dra f tK ings MLB-F i f t y -F i f t y

game

134 t imes

would

have a win r a t i o o f rough ly 45 ,

i e

very s l i g h t l y

worse

t han random

chance ) . Under H aw ai i law , t h e r e f o r e , t h e s e con t e s t s

a re contests

of

chance

2 . Da i l y f a n t a s y s po r t s c o n t e s t s i n vo l v e f u t u r e

c o n t i n g e n t e v e n t s n o t unde r th e c o n t ro l o f p la y er s .

Par t i c i pan t s in

da i l y

f an t a sy

sp o rts c on te st s

win

money

based

on

th e

per formance o f a t h l e t e s

du r ing a t h l e t i c

even t s .

Dai l y

f an t asy spo r t s p l aye r s exe r c i s e

no

con t ro l o r

i n f l uence

ove r

th e

^ Fascination is a game somewhat akin to a mix of skee-ball

and bingo where p l aye r s compete aga i n s t each o the r to be th e

first

o n e to roll a rubber ball into

five holes

in a line

Id .

a t

666 -67 ,

361

P .2d at 1046 .

Op.. No. 16-1


9/11

T he Honorable Rosa lyn H Baker

Janua ry

2 7 , 2 0 1 6

P a g e

ac t ions

of

t hose playe rs . A c h o s e n

a th l e t e

ma y become

i n j u r ed

o r

no t

p lay

in a

given game.

Ad dit io na l ly , th ere a re u nc on tro lla ble

c i r c u m s t a n c e s t h a t

may

a f f e c t th e

po in t s s c o r e d

by

an

a th l e t e ,

inc lud ing

w e a t h e r

and o f f i c i a t i ng . Th u s ,

dai ly

f an tasy

spo r t s

p laye r s r i sk [ ] s o m e t h i n g o f va lue upon th e o u t c o m e o f

a

f utu re c on tin ge nt even t

no t under

[ t he i r ] co nt ro l o r i n f l uence .

Haw. Rev. S t a t . § 7 1 2 - 1 2 2 0

2014) . Indeed , th e on ly

H a w a i i

Supreme C o u r t case to exp l i c i t l y m e n t i o n f ut ur e c on tin ge nt even t

g a m b l i n g i nvo lved g a m b l i n g

on

a

spo r t i ng

even t . S t a t e

v .

O k a m u r a ,

63 Haw. 3 4 2 ,

3 4 3 ,

626 P.2d 2 8 2 ,

2 8 3

1 9 8 1 ) p er

cu r i am) .

Ba s e d o n th e discuss ion

a b o v e , we

c o n c l u d e t h a t da i ly f an tasy

spo r t s con t e s t s con s t i t u t e

i l l e g a l g a m b l i n g

u n d e r H aw ai i la w . We

h o p e

t h a t we h a v e adequate ly r e s p o n d e d

to

y o u r i nqu i ry . Please

con t a c t u s

shou ld

you r equ i r e f ur th e r a ss is ta n ce .

APPROVED:

D ouglas S . C h i n

At t o r ney

Gene ra l

V e r y t r u l y

D e p u t y

At to rney

Gene ra l

O p. N o. 16-1


10/11

DEPARTMENT

OF

THE

ATTORNEY

GENERAL

DAVID

V.

IGE

GOVERNOR

DOUGLAS S CHIN

ATTORNEY

GENERAL

For Immedia te

Release

News

Release 2016-2

January

27,

2016

ATTORNEY

GENERAL

OPINES THAT

DAILY

FANTASY SPORTS CONTESTS

CONSTITUTE GAMBLING

UNDER

HAWAII LAW

HONOLULU - Hawaii Attorney

General

Doug Chin

issued

a formal advisory opinion

today stating that daily fantasy sports contests, such as those run by FanDuel and

DraftKings, constitute iilegai gambling

under

existing state laws.

Gambling generally

occurs

under Hawaii law

when

a

person stakes

or risks

something

of value

upon

a

game of chance o r upon any

future

contingent event

not under the person s control,

said

Chin.

The

technology may have changed,

bu t

th e vice h a s not

Nearly sixty million Americans participate in fantasy sports, with

the

vast majority

playing In a league with friends or colieagues that might be considered social gambling

which is iegai in Hawaii. In contrast, daily

fantasy sports contests

typically involve

competitions between hundreds or thousands of people, are played daily, involve

wagers of up to 1,000, and allow each Individual multiple entries leading to top prizes

of up to 1 million.

Hawaii is generally recognized to have some of the strictest antl-gambling laws

in

the

country, said

Chin.

Bystatute the Attorney General provides opinions upon questions of law submitted by

the

Governor,

the

state legislature or its members, or a state agency head. The

Department of the AttorneyGeneral is weighing next steps, including

v l

or criminal

enforcement,

consistent with its opinion.

The text of Attorney General Opinion 2016-01 is attached.


11/11

cease and desist letter to draftkings

Documents