NEW YORK CITY: New York Attorney General Eric Schneiderman, already trying to shut down daily fantasy sports companies DraftKings and FanDuel in the state, now wants the firms to give back the money they made in the state.
In a court filing on Thursday, Schneiderman is seeking restitution and damages for transactions that he claims constitute illegal gambling.
The move comes as a panel of appellate judges is due to consider on Monday the temporary stay granted last month, which allowed the two websites to continue operations while the state Supreme Court determines whether they are illegal gambling operations or legal games of skill.
Schneiderman issued an administrative cease-and-desist order on November 11 following an investigation by his office concluding the two websites violate New York state laws.
The two firms shut down operations in Nevada following a similar investigation, and Illinois authorities also determined they offered gambling that should be banned or regulated.
In the amended complaint, Schneiderman seeks damages based on “the fraudulent and deceptive acts and the repeated fraudulent acts and persistent illegality” of the firms’ business.
He also seeks restitution to New York state residents who lost money on the site, as well as a civil penalty of up to $5,000 for each violation of the general business law.
DraftKings and FanDuel, the largest of the popular daily fantasy sports websites, say the contests they offer are not gambling.
New York State Supreme Court Judge Manuel Mendez granted a preliminary injunction against the sites on December 11 that would have forced them to halt operations in the state while their legality was determined.