Rep. Frank Pallone from New Jersey made his voice heard recently at Congressional hearings about daily fantasy sports.
Pallone participated in a U.S. House Subcommittee on Commerce, Manufacturing and Trade hearing titled, “Daily Fantasy Sports: Issues and Perspectives.” The hearing was the first of its kind at the federal level.
Pallone talks sports betting
According to several reports, including an article by USA Today reporter A.J. Perez, Pallone was not shy about his support of sports gambling in New Jersey and elsewhere.
“I would like us to legalize sports betting,” Pallone was quoted as saying. “I am hoping this panel and the statements that were made about why it doesn’t make sense to allow (sports betting) to go underground and run by organized crime would lead us to some kind of legislation.”
Pallone also pointed out that NBA Commissioner Adam Silver said in Nov. 2014 that sports betting should be “brought out of the underground and into the sunlight.”
This isn’t Pallone’s first time leading the charge against laws prohibiting sports betting. This past September, he penned a five-page letter to the House Energy and Commerce Committee (of which he the ranking member) requesting a hearing to “review the legal status of fantasy sports”.
In the letter, he asked why fantasy sports, which he believes is a form of gambling, is treated differently than sports betting in the U.S.
Pallone on daily fantasy sports
Pallone noted that fantasy sports are allowed federally under a clause in the Unlawful Internet Gambling Enforcement Act of 2006. That clause says that fantasy sports are exempt from online gambling prohibitions as long as they meet the criteria in UIGEA and abide by state laws.
He went on to argue that at one time or another the MLB, NFL and NBA condoned league players participating in fantasy sports.
Up until this past fall — when daily fantasy sports came under legal challenges in New York and elsewhere — the DFS industry was able to thrive and grow, largely without pushback. Then came a number of state attorneys general who opined that DFS is illegal gambling in the months before the Congressional hearing was convened.
The DFS hearing: Much ado about nothing?
Legal Sports Report wrote that little should be expected in the way of action in the wake of the hearing. A Fortune article said the hearing was a meandering mess, noting that several representatives seemed to be “unfamiliar with the concept of daily fantasy sports.”
One lawyer in attendance was quoted as saying the meeting was, at worst, “a colossal waste of time” and that Pallone may have mustered enough momentum to get another hearing.
According to USA Today, representatives from the major North American pro sports leagues were invited to the hearing, yet nobody from those leagues appeared. Each league, except for the NFL, owns equity in DraftKings or FanDuel, while most teams in all those leagues have sponsorship deals with the DFS sites.
Though nobody from DraftKings or FanDuel attended the meeting, Peter Schoenke, chairman of the Fantasy Sports Trade Association, was quoted as saying that laws against sports betting don’t apply to DFS sites because they offer games of skill, not chance.