America, are you enjoying yourself? Are you ardently dedicated to a goofy pasttime in which you engage with friends, occasional booze, barbecue, and even exchange of money between mutually agreed parties on mutually agreed terms? Well, Congress can’t have that.
Enter Rep. Frank Pallone who has observed all this fun-having and exchange of money and finds that it warrants a Congressional hearing:
On Monday, New Jersey Democrat Frank Pallone Jr. called for a congressional hearing into the relationship between the NFL and the fantasy leagues that clogged airwaves during this season’s opening weekend.
“Anyone who watched a game this weekend was inundated by commercials for fantasy sports websites, and it’s only the first week of the NFL season,” Pallone said in a statement. “These sites are enormously popular, arguably central to the fans’ experience, and professional leagues are seeing the enormous profits as a result. Despite how mainstream these sites have become, though, the legal landscape governing these activities remains murky and should be reviewed.”
I’ll give him this. The ads are overkill. This might serve as an object lesson to companies who are thinking of flooding the zone with their dumb commercials, lest they attract the attention of bored Congressmen who have nothing better to do than hold Congressional hearings about sports that are literally not even real. If you thought the baseball hearings might not be the rightful province of our deliberative bodies, wait ’til you get a load of them regulating *fantasy.*
Pallone’s flag-throw on this fun-having came in the form of a very official letter, naturally. Imagine the staffers who had to write this thing while sloshed after Sunday football day drinking. Joel Gehrke reports on the letter, in which specters were indeed raised:
The top Democrat on the Energy and Commerce Committee conjured concerns that players might use fantasy sports to bet on games.
“Team involvement in daily fantasy sports also raises questions of whether players or league personnel, who may be able to affect the outcome of a game, should be allowed to participate in daily fantasy sports,” he wrote in a September 14 letter to his GOP counterparts on the committee.
FanDuel anticipated this kind of action at some point. And what happens when you anticipate attempts to regulate you out of existence? You gots to get a lobbyist!
While the sports sites have largely avoided scrutiny, the young industry is clearly on guard against regulatory and legislative proposals that could put a crimp in their business.
FanDuel, the largest of the fantasy sports sites, joined the influential Internet Association last week, increasing its lobbying presence in Washington. The company said no specific policy battle spurred the move.
Pallone says there’s a “loophole” for fantasy sports under a 2006 law that allows these sites to exist:
Online sports betting and online gambling are prohibited under federal law, but the leagues are taking advantage of a loophole that has become known as the fantasy sports “carve out,” according to Pallone.
I wrote and worked against the Unlawful Internet Gambling Enforcement Act in ’06— the offspring of protectionist, established gambling entitites and meddlesome Congress members, which provided this “loophole.” Here’s why these sites are legal for the moment. Fantasy sports are a game of skill, which your 40-100 hours of fantasy draft prep attests:
In 2006, the federal government passed a law called the Unlawful Internet Gambling Enforcement Act that established fantasy sports as a “game of skill” and not a “game of chance.” The law says it’s legal if it:
(I) is not dependent solely on the outcome of any single sporting event or non-participant’s singular individual performance in any single sporting event;
(II) has an outcome that reflects the relative knowledge of the participants, or their skill at physical reaction or physical manipulation (but not chance), and, in the case of a fantasy or simulation sports game, has an outcome that is determined predominantly by accumulated statistical results of sporting events, including any non-participant’s individual performances in such sports events
None of this is to say that such sites can’t have downsides and nefarious aims; just that I’m not holding my breath for Congress to create a better situation more beneficial to Americans. I wouldn’t bet on it. Har. See what I did there?