Schneiderman v. DraftKings, FanDuel: Decision on NY Preliminary Injunction Motions Coming “Very Soon”

A New York trial judge said his decision will come “very soon” in the state court lawsuits between N.Y. Attorney General Eric Scneiderman and daily fantasy sports (DFS) industry leaders DraftKings, Inc. and FanDuel, Inc.

On November 10, 2015, Schneiderman sent DraftKings and FanDuel cease and desist letters, ordering the companies to refrain from accepting New Yorkers’ DFS wagers. The AG claims the companies’ DFS operations constitute illegal gambling under New York law.

Following the letters, all three parties — DraftKings, FanDuel, and Schneiderman — filed motions for preliminary injunctions in individual actions.  Oral argument for these motions was held before N.Y. Judge Manuel J. Mendez on Wednesday November 25, 2015.  The judge, however, did not return a decision at the hearing, opting instead to deliver it at a later date.

If a court grants a preliminary injunction request, the order generally bars a defendant from engaging in an activity until the overall case reaches a final determination.  For example, DraftKings and FanDuel requested that the court bar Schneiderman from prohibiting the companies’ business operations in New York.  Should Judge Mendez grant the companies’ motions, they will be permitted to continue DFS operations in New York until the case is decided on the merits.  This means that—although Schneiderman’s decision could be restrained pursuant to the preliminary injunction motions—the decision may ultimately be reinstated if Schneiderman is successful on subsequent dispositive motions or at trial.

In reserving a decision on the matter, Judge Mendez promised to deliver a ruling “very soon.”  DraftKings’ attorney, David Boies, stated that this ruling could come as early as this week.

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