Tennessee gov legalised DFS; DraftKings and FanDuel exit Alabama market

The most famous fantasy sports operators DraftKings and FanDuel stopped their activities in Alabama. Earlier, Attorney General Luther Strange sent a letter to the companies demanding to stop carrying cash tournaments until 1 May.

Alabama AG Luther Strange sent two letters to the two daily fantasy sports providers on April 5 with the order to cease and desist all real-money activity with state residents. On Friday, he issued a statement telling the providers had agreed to comply with the order on May 2.

At the press conference Luther Strange informed that he was glad that his order was fulfilled by FanDuel and DraftKings. Both operators have agreed to block IP-addresses of pages with paid tournaments and pledged not to take money from clients. More than that, the operators promised to satisfy Alabama customers’ requests on withdrawal of their money within the period of 7 days after getting the requests. He told, “As Attorney General, it is my duty to uphold Alabama law, including the laws against illegal gambling. The daily fantasy sports operations violate state law because a player stakes something of value on a contest of chance in order to win a prize. While there is a measure of skill involved in creating a fantasy sports roster, in the end, contestants have no control over the performance of the players on their rosters. This activity is illegal under Alabama law.”

A federal lawsuit against DraftKings and FanFuel was filed in November by two men from Jefferson County. They alleged that the operations qualified as illegal gambling and that their DFS games were misinterpreted as games of skill, not of chance.

The U.S. Department of Justice and the FBI launched a probe in October into the DFS industry. Nowadays 12 states have made paid DFS competitions illegal.

Virginia and Indiana’s government signed their respective DFS bills into law in March. Meanwhile, Tennessee became the third state to regulate daily fantasy sports. Gov. Bill Haslam signed a law on April, 27th.

Tennessee joins Indiana and Virginia, where the governments introduced supervision rules for the industry this year. Massachusetts Attorney General Mora Haley also adopted regulations on the DFS this year.

The law should come into force on 1 July; until that time, fantasy sites can decide whether they want to be licensed in the state or not.

According to the document, the 6-percent tax on profits earned is introduced. Earlier it was reported that the Attorney General Herbert Slatery issued an opinion that fantasy sports gambling is illegal due to Draftkings’ data leak scandal in October.

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