A number of daily fantasy sports companies have received cease-and-desist letters from the Florida Gaming Control Commission, which claims that they may have engaged in potentially unlawful sports betting.
Florida Regulators Challenge Legality of Fantasy Sports Activities
The correspondence was addressed to Underdog Sports, PrizePicks, and Betr, the latter being a project supported by boxer-turned-internet personality Jake Paul. These letters, which were signed by the Florida Gaming Control Commission’s Executive Director, Louis Trombetta, expressed doubts over the legitimacy of these operators’ operations in the Sunshine State.
In the letters, Trombetta declared, “I am hereby demanding you to cease and desist offering or accepting bets or wagers from residents of this state on the results of any contests of skill, such as sports betting.” He said that if these demands are not met, the Attorney General’s Office of Statewide Prosecution may be notified of the situation.
A lawyer for the companies that were targeted said that they would cooperate with the commission to make sure that their clients could still participate in fantasy sports competitions. But it seems that the Commission’s action has wider ramifications than first believed. Emails acquired by the Florida News Service indicate that the legal rulings in these letters may be applicable to all paid fantasy sports competitions, which might have an impact on businesses that provide different kinds of fantasy games, such as Underdog Sports.
Emerging Fantasy Sports Ventures Hit Roadblocks in Florida
This crackdown could have an effect on season-long fantasy sports when the football season picks up steam. Furthermore, the Commission appears to be strict with other types of wagering, despite current legal disputes regarding the Seminole Tribe’s exclusive rights to conduct sports betting in Florida.
Trombetta’s correspondence makes it clear that sports betting is only permitted in accordance with a gaming compact, like the one the Seminole Tribe signed in 2021, under Florida law.
The founder of Underdog Sports, Jeremy Levine, angrily denied the accusations, claiming that his company’s products are skill-based rather than chance-based and that they fall inside the legal definition of a fantasy sports game. Levine went so far as to claim on social media that the two industry heavyweights, DraftKings and FanDuel, who remarkably did not receive cease-and-desist letters, were “directly fueled” by this scrutiny.
Large participants in the market are unaffected, while newcomers like Betr—which just released an app centered on microbetting—find that their Florida plans are being hindered by the new regulatory steps. Joey Levy and Jake Paul founded Betr in 2022 with the goal of revolutionizing the conventional betting experience and, with regulatory approval, expanding to a few states.