Texas attorney general releases opinion on paid daily fantasy sports

By Mark Iandolo | Jan 22, 2016

AUSTIN, Texas (Legal Newsline) — Texas Attorney General Ken Paxton has announced his opinion on the legality of online gaming in response to a legislative inquiry.

“It’s my duty as attorney general to look to the law, as passed by the peoples' representatives, to answer the questions put to this office,” Paxton said. “Paid daily fantasy sports operators [allege] they can legally operate as an unregulated house, but none of their arguments square with existing Texas law. Simply put, it is prohibited gambling in Texas if you bet on the performance of a participant in a sporting event and the house takes a cut.”

Paxton added that the sites are also wrong in their actual-contestant exception claims. Actual-contestant exceptions can only apply in an actual skill or sporting event, he said. Additionally, Texas–unlike other states–only requires “partial chance” for something to be considered gambling. The law does not require that that chance predominate.

Paxton’s opinion makes it clear traditional fantasy sports leagues are generally acceptable under Texas law because participants split the pot among themselves. There is no house taking a cut.

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