California AG Declares Daily Fantasy Sports Illegal Gambling

On July 3, 2025, California Lawyer Common Rob Bonta issued a proper authorized opinion figuring out that every day fantasy sports activities (DFS) contests – together with decide’em and draft-style video games supplied by platforms similar to DraftKings, FanDuel, and Underdog—are thought of unlawful playing below state regulation. The opinion was printed in response to a request from Assemblymember Tom Lackey, in accordance with Authorities Code part 12519, which authorizes the state’s Division of Justice to supply formal interpretations of current statutes.

In response to the State of California Division of Justice – Rob Bonta AG official press launch, the 33-page opinion (labeled 23-1001) concluded that DFS contests contain betting on the outcomes of real-world sporting occasions and subsequently fall below California’s Penal Code restrictions towards on-line sports activities wagering. Whereas operators typically promote these video games as skill-based, the opinion discovered that they align with the authorized definition of playing, since gamers place financial wagers primarily based on athlete efficiency and will win or lose cash relying on the outcomes.

“Like conventional sports activities wagering, every day fantasy sports activities video games allow contributors to win or lose cash primarily based on the result of sporting occasions performed by third-party athletes,” Bonta wrote. The opinion additional argued that although the operators themselves don’t immediately wager, the contests nonetheless represent betting since contributors compete towards one another for real-money prizes.

Trade Pushback: Operators Refuse to Again Down

Following the discharge of the opinion, main DFS operators signaled no intention to withdraw from the California market. DraftKings issued an announcement difficult the interpretation, saying it “respectfully disagrees” with the AG’s stance and asserting the legality of peer-to-peer fantasy contests. “We consider peer-to-peer fantasy sports activities contests are authorized in California, and we intend to proceed providing them, as we now have finished with out problem or challenge for over 13 years,” the corporate stated.

FanDuel echoed this sentiment, expressing curiosity in partaking with the Lawyer Common’s workplace to debate the matter additional. In the meantime, Underdog—a rising DFS operator—reiterated its intention to proceed operations within the state. The corporate had beforehand filed a lawsuit trying to dam the discharge of the opinion, describing it as an “imminent, existential risk” to its enterprise mannequin. Nevertheless, the swimsuit was dismissed by a California decide, who dominated that the opinion doesn’t equate to new regulation and doesn’t trigger irreparable hurt.

Underdog maintains that its contests depend on talent and pointed to authorized rulings in different states, similar to New York and Illinois, the place courts decided DFS doesn’t qualify as playing. An organization consultant famous that California contributes roughly 10% to Underdog’s complete yearly income.

Authorized Weight and Tribal Response

Though the opinion issued by the Lawyer Common just isn’t legally binding, it carries what is called “persuasive authority” in California’s judicial system. Chris Micheli, a regulation professor at McGeorge Faculty of Legislation, defined that such opinions are often cited in court docket selections and will affect the trajectory of future legislative or judicial actions.

The California Nations Indian Gaming Affiliation (CNIGA) responded favorably to Bonta’s conclusions, applauding the opinion and demanding stronger enforcement. “Untold thousands and thousands if not billions have been illegally wagered over the previous decade. The place is the enforcement? The place is the accountability?” the group acknowledged. CNIGA Chairman James Might urged state authorities to take agency motion in gentle of the opinion.

On-line sports activities betting stays unlawful in California, considered one of ten states within the U.S. that also prohibit it. Current poll efforts aimed toward legalizing sports activities betting within the state, together with these in 2022, have failed to realize enough voter help. Bonta’s opinion reinforces that, below present regulation, every day fantasy contests are topic to the identical restrictions as conventional sports activities playing.

A spokesperson for Governor Gavin Newsom weighed in, stating that the governor doesn’t agree with the AG’s interpretation however helps pursuing a “constructive path ahead in collaboration with all stakeholders.”

Supply:

California Lawyer Common says every day fantasy sports activities are unlawful playing, World On line casino Listing, July 3, 2025.