Monday, November 16, 2015 saw a lot of action regarding the ongoing daily fantasy sports (DFS) controversy in New York State.
On November 10, 2015, following a month-long investigation into the operations of DFS industry leaders DraftKings, Inc. and FanDuel, Inc., N.Y. Attorney General Eric Schneiderman notified the two companies of his decision to shut down their state-conducted business. By way of cease and desist letters, Schneiderman required the companies to refrain from accepting DFS wagers placed by New York servers.
In response, both DraftKings and FanDuel filed individual state court actions against AG Schneiderman, seeking injunctive relief. The petitions, filed on Friday November 13, 2015, allege that Schneiderman’s acts against the companies are illegal.
The saga continued on Monday November 16th with DraftKings’ filing of a temporary restraining order request. FanDuel will most likely make the same submission in its own action.
In a lawsuit requesting injunctive relief — i.e. a plea to force the defendant to refrain from acting, as compared to a plea for money damages—the plaintiff may seek a temporary restraining order (TRO). A TRO preserves the status quo between the parties. In other words, where a defendant is allegedly harming a plaintiff, a TRO grant will temporarily force the defendant to discontinue the harmful activity. In order to obtain a TRO, the plaintiff must show that “immediate and irreparable injury, loss or damage will result” if the defendant is not restrained. See N.Y. C.P.L.R. §6301. A TRO is in place only until the matter is decided at a preliminary injunction hearing.
Also on Monday November 16th, N.Y. State Senator Michael Razenhofer proposed legislation to make DFS legal under the New York Constitution. Razenhofer stated:
We have an activity here in New York which is legal. The attorney general last week made a unilateral decision that in his opinion fantasy sports is illegal. I think that’s wrong.
The proposed legislation, however, would not be in effect until November 2016.