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Texas lawmakers renew fight over daily fantasy sports games

February 03,2017 00:17

Daily fantasy sports games are a relatively new and largely self-regulated industry, with operators required to interpret each state's laws — most of which, like in Texas, do not mention fantasy sports — to determine whether the games are allowed ...and more »



Texas lawmakers are venturing into the debate over the legality of daily fantasy sports leagues, a billion-dollar industry that has created regulatory battles across the country.

State Rep. Richard Peña Raymond, D-Laredo, on Wednesday followed through on a promise last summer to propose a bill that plainly designates fantasy sports as legal, skill-based games in direct contradiction to the opinion handed down by Texas Attorney General Ken Paxton last year deeming them illegal gambling.

“If you don’t think fantasy football is a game of skill, then you haven’t played it,” Raymond said. “This is something that government shouldn’t stick its nose into. A government shouldn’t take away our right to play fantasy football.”

Participants in daily fantasy sports contests pay an entry fee and create teams from a menu of professional or amateur athletes, then compile points based on statistical performance, such as yards gained and touchdowns scored in football. Money is awarded to the owners of the top teams in the online games, which typically last one day to one week.

Daily fantasy sports games are a relatively new and largely self-regulated industry, with operators required to interpret each state’s laws — most of which, like in Texas, do not mention fantasy sports — to determine whether the games are allowed.

Raymond, along with four co-sponsors, filed three bills Wednesday related to fantasy sports.

Two of the bills, HB 1418 and the identical HB 1422 Raymond filed as the sole sponsor, would require fantasy game operators to pay a registration fee of $5,000 with the Texas secretary of state. Those operators would also be required to pay an annual $5,000 renewal fee.

The bill would also aim to prevent insider information trading and other activities that led to scandals that prompted governments to scrutinize the industry over the past two years. It would carry civil penalties of $1,000 for violations of the law.

But Raymond said he would be pushing forward HB 1457, a proposal that has no filing fee and no civil penalties but includes provisions to combat insider information trading. Under the bill, the attorney general could stop a fantasy sports business from operating if it violated the rules of the proposal. Violators would be subject to paying back any costs incurred by the attorney general in case of an injunction.

All the proposals require participants in paid fantasy sports contests to be 18 or older.

More than 57 million people in the country — including 4 million in Texas — play fantasy sports, according to trade groups. Participants spend an estimated $556 over a 12-month period to invest in their fantasy sports team, the Fantasy Sports Trade Association said.

“(Texas Fantasy Sports Alliance) applauds Rep. Raymond for proposing legislation that clarifies the right of Texans to play fantasy sports, while also providing consumer protections, and allowing this growing industry to prosper in Texas,” Scott Dunaway, a spokesman for the pro-fantasy sports group said in a statement. “We are confident the legislature will follow their lead by affirming the legality of this extremely popular leisure-time activity.”

Raymond said he feels confident that his proposal could make its way through the House. No corresponding bill has been filed in the Senate, but Raymond said he’s spoken to several lawmakers in that chamber about his proposal.

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