In a significant move, the Florida Gaming Control Commission has issued cease-and-desist letters to several daily fantasy sports (DFS) operators, including PrizePicks, Betr, and Underdog Fantasy. These companies have been instructed to halt their operations in the state by March 1, 2024. This decision stems from the companies’ offerings that allow players to bet against the house, a practice that deviates from traditional DFS games where players compete in pools or peer-to-peer.
Understanding the Regulatory Concerns
The core of the regulatory concern lies in the nature of the games offered by these companies. The state regulators have determined that the pick’em contests provided by PrizePicks and Underdog fall under the category of sports betting rather than legal fantasy contests. This distinction is crucial as it places the companies’ operations outside the legal boundaries set by existing Florida law, which permits DFS operators to serve users without needing a license for traditional fantasy sports contests.
The Impact of Non-Compliance
The consequences of not adhering to the cease-and-desist orders are severe. Companies that fail to comply within the given timeframe risk facing legal actions from the state. However, the Florida Gaming Control Commission has indicated that if the cessation of the specified games is completed within the deadline, the companies and their officials will be considered to have complied with the order, avoiding further action.
Monopoly and Market Dynamics
The backdrop to this regulatory action includes the Seminole Tribe’s monopoly on most house-banked table games in Florida. The tribe has expanded its gaming privileges to include various forms of gambling, including online sports betting. The entry of DFS operators like PrizePicks into the market is seen as a violation of the Seminole compact, which strictly regulates gambling activities in the state.
Legal and Financial Implications
The departure of DFS operators from Florida is not just a regulatory matter but also has significant financial implications. For instance, PrizePicks agreed to pay a $15 million settlement in New York for operating unlicensed for three years. Such settlements highlight the financial risks associated with non-compliance and the importance of adhering to state gambling laws.
Looking Ahead: The Future of DFS in Florida
As the deadline approaches, the future of daily fantasy sports in Florida remains uncertain. While companies like PrizePicks and Underdog Fantasy prepare to exit the market, the state’s regulatory landscape continues to evolve. The actions taken by the Florida Gaming Control Commission signal a strict stance on gambling and fantasy sports, emphasizing the need for companies to operate within the legal framework.
In conclusion, the departure of PrizePicks and other DFS sites from Florida marks a significant moment in the ongoing debate over the legality and regulation of fantasy sports in the United States. As states grapple with these issues, the outcome of Florida’s regulatory actions could set a precedent for how other jurisdictions approach the regulation of DFS and sports betting in the future.
