Daily Fantasy Sports Might Be Legalized as a Form of Pari-Mutuel Wagering
A Nevada-based company named U.S. Fantasy proposes to turn daily fantasy sports into a parimutuel wagering system. US Fantasy’s owner, Vic Salerno, believes DFS under the new rule system would be legal in many US states, including Nevada. If Salerno is right, then daily fantasy sports gaming might return to Nevada sooner than people think.
This week, the Nevada Gaming Control Board recommended that US Fantasy be licensed, which sends the question along to the Nevada Gaming Commission.
That is an important endorsement, because the NGCB’s chairman, A.G. Burnett, was the official who first questioned the legality DraftKings and FanDuel. Armed with Burnett’s rationale, Attorney General Adam Laxalt drove the two DFS companies out of the state in the first place. If Burnett is recommending DFS gaming in a modified form, then the practice is likely to gain approval in Nevada.
Daily Fantasy Sports in Nevada
DraftKings and FanDuel were told to cease operations in Nevada with immediate effect, though they were told they could continue to operate, if they applied for licenses as gaming operators. Since they would have been classified as sportsbook operators and sports betting is restricted to licensed land-based operators, licensing might not have had any advantages for DraftKings and FanDuel. They declined to get involved in the Nevada gaming industry on those terms.
DraftKings and FanDuel argue that fantasy sports was given a carve-out in the 2006 UIGEA law, so daily fantasy sports should be legal in the United States (at the federal level). State attorney generals and gaming control commissions have challenged that assertion in the past year, often banning the activity at the state level.
The problem with daily fantasy sports is it sits in a legal limbo. For years, that limbo was advantageous to the DFS industry, because they could argue that their game was legal under the UIGEA. This allowed DraftKings and FanDuel to collect investments from major media corporations and Wall Street holding companies.
Since the state agencies began to challenge the companies, the legal limbo is now a disadvantage. It places the companies in jeopardy of being banned. Under the circumstances, having special laws written to regulate and license such gaming has seemed like the only realistic alternative. The legislative process takes a long time and has a lot of moving parts, because lawmakers often are backed by special interests.
Vic Salerno’s idea might be a way around another round of legislation, though.
Treating DFS Like It’s Horse Racing
Vic Salerno’s idea is to treat daily fantasy sports like it’s horse racing. Athletes competing on any given day would be given odds like horses in a race. DFS competitors would wager on the various players and those who wagered on the top performers would be paid.
When Vic Salerno was asked about the idea in Gaming Today, he said, “All we’re doing is replacing horses with human athletes.”
In a past interview with the Las Vegas Review-Journal, Vic Salerno said, “It’s so simple, I can’t understand why anyone didn’t think of this before. We know fantasy sports has proven to be an attractive offering for a broader audience. It’s a unique opportunity for the industry.”
US Fantasy in Nevada Casinos
U.S. Fantasy plans to offer pari-mutuel fantasy sports through brick-and-mortar casinos in Nevada. In other US states, the company is expected to seek deals with racetracks, off-track betting facilities, lottery companies, and appropriate casinos. How successful these initiatives might be remains in question, but Vic Salerno is optimistic.
About Vic Salerno
Vic Salerno knows the Nevada sports betting industry like few others. In the 1970s, Salerno founded Leroy’s House and Sports Palace. This operation grew into “US Wagering”, a sportsbook services company which handles the sportsbook operations for a majority of Nevada’s sportsbooks.
In 2012, Vic Salerno sold US Wagering to William Hill, which rebranded the company William Hill USA. Vic Salerno was retained as the CEO of the new William Hill USA. Over the years, the founder of US Fantasy has been credited with several innovations in American sports betting. He created the sports betting kiosk, while also launching the first mobile sports betting app in the United States.
The Future of American DFS
Thus, if anyone is qualified to project where the daily fantasy sports industry in the United States is likely to be headed, it is Vic Salerno. With his connections in the gaming world, it is likely that Vic Salerno’s US Fantasy is going to have a big impact on fantasy sports in the USA.
