In another setback for the daily fantasy sports industry, a New York State Supreme Court judge on Monday denied a temporary restraining order requested by DraftKings and FanDuel that would have halted efforts to shut them down in New York.
The companies requested the order in the wake of Attorney General Eric Schneiderman's cease-and-desist letters issued last week. If Judge Manuel Mendez had granted the order, DraftKings and FanDuel would have been allowed to accept contest entries while fighting Schneiderman's decision in court.
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Seemingly indomitable not so long ago, the companies haven't been able to catch a break in court or elsewhere as state and federal lawmakers determine whether contests offered on the sites constitute illegal gambling.
DraftKings and FanDuel filed separate lawsuits last week following Schneiderman's decision to "prevent a unilateral, misinformed and legally misguided attempt by the New York attorney general to act as ‘judge, jury, and executioner’ for daily fantasy sports in New York."
"We're going to win this case if we just get our day in court," Randy Mastro, a Draft Kings attorney, said after Monday's decision.
Proceedings in the lawsuits are scheduled to resume Nov. 25.
The companies argue their contests are games of skill and should not be considered illegal gambling, but legislators thus far have tended to not agree. Last week's ruling in New York was the most significant blow to the industry since Nevada regulators ruled Oct. 15 that daily fantasy sports companies must obtain gambling licenses or cease operations.
Other states are considering measures similar to New York's to ban the contests.
"Both FanDuel and Draft Kings are making huge profits off their felonious product," Kathleen McGee, a representative for the attorney general's office, said Monday.
