Well … not exactly, but the roof came crashing in for DraftKings, FanDuel and their ilk yesterday when the Nevada Gaming Commission sent them a cease-and-desist order, instructing that daily fantasy sports pools quit taking action from Nevada-based 
players until they (the sites) have Silver State gaming licenses. So, anybody with a 10% or greater state in a DFS site can prepare for the lawyerly equivalent of a body-cavity search or they can decide the Nevada market isn’t worth the trouble. (The prospect of going before the Nevada Gaming Control Board should cause some DFS sphincters to pucker.) The NGC’s decision was taken after Nevada Attorney General Adam Laxalt‘s office issued an opinion that DFS was gambling, not a contest of skill.
Licensed Nevada operators of sports pools were advised by the NGC to “exercise discretion in participating in business associations with D.F.S. operators that have not obtained Nevada gaming approvals.” Internet-gaming blogger Chris Grove called the decision “self-serving, but that is what the agency is designed to do — ensure an environment where the state’s licensed operators have the best chance of success, and part of that mission is to address forms of alternative gambling that fall outside the umbrella of regulation.” One might also point out that the DFS phenomenon had created an unlevel playing field in Nevada, with duly vetted and licensed sports books trying to compete with DFS sites that are answerable to no one but themselves.
Local attorney David Gzesh told the New York Times the NGC’s action “should give other states pause because if it’s perceived as 
sports gambling here, no other state can offer it when it violates federal law.” He added that major-league sports (who are major-league investors in DFS) will find themselves in a pickle trying to suppress a New Jersey law permitting sports betting when it goes before the Third Circuit Court of Appeals. “If they maintain the suit in New Jersey,” Gzesh said, “it sure looks like they are trying to have it both ways.”
“Although Congress may have exempted DFS from federal laws involving gambling, it remains up to the states to decide whether 
DFS as games of skill fall within the available exceptions to prohibited games of chance,” gaming attorney Jeff Ifrah told the Las Vegas Review-Journal. However, a growing number of senators and congresspeople (Rep. Dina Titus [D] is the newest recruit) are calling for a reexamination of the fantasy sports carve-out in the Unlawful Internet Gambling Enforcement Act of which DFS is the rampant afterbirth. Even UIGEA co-parent Jim Leach is suffering remorse over what DFS hath wrought.
FanDuel, DraftKings and Amaya‘s StarsDraft all agreed to abide by the Nevada ban. Some took it with better grace than others. “This decision stymies innovation and ignores the fact that fantasy sports is a skill-based entertainment product loved and played by millions of sports fans,” sulked FanDuel. DraftKings spokeswoman Sabrina Macias hinted at untoward motivations, stating, “We understand that the gaming industry is important to Nevada and, for that reason, they are taking this exclusionary approach against the increasingly popular fantasy sports industry.”
Yeah, I’m sure that’s what happened: The NGC all huddled in a room and decided, “We’ve got to stop this thing.” (Not.) Whatever the case, we shall see shortly whether DFS things the Nevada market is one that’s big enough to justify submitting to the licensing process.
* Penn National Gaming‘s Plainridge Park slot parlor isn’t putting a hurt on tribal gambling in Connecticut. Slot revenues at both Mohegan Sun and Foxwoods Resort Casino were up 3% last month.
