Prop-bet style games offered by Daily Fantasy Sports could soon be banned in Michigan, with the regulator Michigan Gaming Control Board ‘exploring new regulations’ around the player versus house bet type.
The proposed regulations, which would also require passing through legislature, would ban what daily fantasy providers dub ‘pick-em style’ games. Pick-em style games pit the player versus the house, where normal contests take a rake and are strictly player versus player.
The MGCB has stated that it seeks to ban “proposition selection or fantasy contests that have the effect of mimicking proposition selection”. Furthermore, “any fantasy contests that involve, result in, or have the effect of mimicking betting on sports” would be banned under new regulations.
There is widespread pressure from commercial and legally licensed sports betting operators to clamp down on operators such as DraftKings and FanDuel. Recently, Underdog Fantasy’s CEO penned an open letter to his customers, accusing DraftKings, FanDuel and their ‘lobbyists’ of trying to ‘eliminate competition’.
He added a short legal defense of the products offered, as well as lamenting the two companies that helped fight for DFS legalization before the repeal of PASPA.
Levine’s comments read: “They can’t tell policymakers and others they don’t like competition, so FanDuel and DraftKings have constructed a disingenuous narrative that our fantasy sports contests are illegal. The arguments are ironic, ignoring the letter of the law for the same flimsy “feels like sports betting” line that critics have always lobbed at their paid fantasy sports contests. That’s why, despite more than a year of effort and tons of lobbying dollars, FanDuel and DraftKings are losing the fight with regulators.
A clear, simple fantasy sports legal framework exists because of the laws they wrote and their claims directly contradict those laws. And it’s pretty simple – under those laws, a fantasy sports contest must have three core characteristics:
- A game based on skill;
- Use predictions on two or more athletes from different teams; and
- Have the outcomes based upon those athletes’ accumulated statistics in real- world contests.
- Every single one of our contests meets that simple definition. Fantasy sports is not limited to only FanDuel and DraftKings’ salary cap contests. The laws they wrote say fantasy sports is far broader than just salary cap.
Equally important, in nearly every state where a sports betting law has been passed, the law makes crystal clear that fantasy sports are not sports betting. Explicitly, these laws state that if a contest is fantasy sports, it is therefore not sports betting.”
Michigan is one of the only states that has a full suite of legalized gambling products. At the end of 2022, the MI online sports betting landscape had 15 approved incumbents, and 14 MI online casino brands between the tribes and the three commercial casinos in Detroit – all of which have recently had their licenses renewed for a further year.