Ring Of Sports Marketing

Date archives November 2015

Uncategorized

Pierre Garcon files class-action lawsuit on Daily Fantasy sports provider.

Pierre Garcon has filed a class-action lawsuit against FanDuel.  FanDuel, along with Draft Kings, who is not named in the lawsuit, are the two largest daily fantasy services paying out millions every weekend.  FanDuel, unlike Draft Kings, doesn’t have an agreement with the NFL Player’s Association (NFLPA).  The NFLPA, not the league or individual teams, controls the collective rights of players’ likeness and names.  Garcon argues that even though FanDuel has agreements with multiple NFL teams and players they still don’t have the rights to profit off players’ likeness and performances.

The ruling on this case could have huge implications for fantasy sports as a whole.  If people are profiting off players’ likeness and performances then how is that different from the legal sports betting operations that go on in Las Vegas?  Is Daily Fantasy sports betting in disguise?

Fantasy sports have traditionally operated in leagues where people may win money within their own league.  Friends in a 10-team fantasy football league may put up their own money off the internet and away from the fantasy provider such as ESPN or Yahoo.  With the daily fantasy operations you see the provider typically paying out the winners themselves.  So how is that any different from a gambling operation?

By taking money from participants and paying them out it would appear to be violate the Unlawful Internet Gambling Enforcement Act of 2006.  On the heels of DraftKing employee using insider information to make money on FanDuel it is calling into question just how daily fantasy should be classified. If Daily Fantasy is ruled as a game of skill, thus being a differentiator from how gambling is traditionally classified, how is it any different from sports betting that we know today?  Daily Fantasy has been operating in a grey area and depending on how this case results it could bring America closer to legal sports-betting nationwide or even more restrictions on profiting from sporting events and performances.

What this means for combat sports:

One of the strongest motivators for fandom of a league, event, or athlete, is economic.  Economic motivation is a polite way of saying people betting on sports.  The NFL has never been more popular with the rise of fantasy sports they create bragging rights between friends and the potential for profiting within their own group of friends.

The UFC, Bellator, and other MMA and boxing promotional companies do not have a schedule that would be conducive to weekly fantasy that we commonly see with NFL, NBA, and MLB fantasy leagues.  Daily Fantasy is crucial for a wide-spread increase in economic motivation to follow each combat sport, events, and athletes.  One issue that combat sports may have that the other leagues don’t is a union that owns the collective rights of athletes.

There are a lot of questions that will have to be answered during the lawsuit.  Do daily fantasy operators need permission from all athletes in order to profit from their likeness and performance?  Is Daily Fantasy a game of skill or gambling?  How does it differ from traditional sports betting?

(via Pierre Garcon files class-action lawsuit against FanDuel – The Washington Post)