A lawsuit filed in Massachusetts calls out fantasy sports operators and the blurred lines between sports betting and fantasy sports.
Joseph Curran of Gloucester, a suburb of Boston, is suing PrizePicks, Underdog Fantasy and Yahoo! Fantasy Sports. He claims that the companies “intentionally refrained from registering with Massachusetts” to offer the kinds of wagers he placed. Curran is asking that all his bets be refunded.
The lawsuit was filed on 17 October in Essex Superior Court.
Digital and retail sports betting are legal in Massachusetts after the state legislature approved it in August 2022. In-person sports betting went live in January 2023, and digital betting launched in March of that year. With sports betting, consumers can bet on game results or proposition bets. The operators are regulated and taxed by the state.
Nuance of sports betting, traditional fantasy, pick’em
In Massachusetts, traditional fantasy sports games are legal. In these games, players build a team of athletes and compete against each other. The winner gets the pot or a percentage of it. The companies make money by charging an entry fee. But in recent years, fantasy sports companies have begun offering other contests, like pick’em or prop betting, that many in the wagering industry see as crossing the line to sports betting. With those bets, Curran contends in his lawsuits, bettors are playing against the house.
According to the lawsuit, the three fantasy companies earned more than $10m (£7.7m/€9.3m) per month on what are referred to as illegal bets.
Bigger companies, like DraftKings and FanDuel, also offer fantasy sports contests, but are licensed by the state. In the complaint, Curran’s lawyers wrote that until at least March 2024, the fantasy companies “also offered sports wagers. However, defendants offered and accepted wagers in Massachusetts illegally because they were never registered in Massachusetts as entities that can accept such bets.”
The question of whether or not props or pick’em-style fantasy contests are legal has been a hot topic in 2024. Regulators in Michigan and New York have specifically banned such bets, but Massachusetts has not taken such action. Myriad other states have sent cease-and-desist letters to some fantasy companies.
Cease-and-desist letters sent
In February of this year, the Massachusetts attorney general’s office sent cease-and-desist letters to 10 fantasy operators for offering pick’em games. Yahoo! Fantasy Sports was on that list. PrizePicks and Underdog Fantasy were not, but had already agreed to exit the state or remove specific offerings, according to the lawsuit.
In the lawsuit, Curran’s lawyers say that the fantasy companies were offering bets against the house, rather than peer-to-peer, like traditional fantasy contests. Curran promises to turn any settlement over to charity, should he win the case.
