Fantasy sports games have avoided the courtroom so far,but companies must make sure their games are skill-based and give consideration to the professional athletes’ licensing rights,an expert attorney said.
“We might advise clients to set up their fantasy leagues in such a way that the skill of the fantasy player is more likely to dictate the outcome of the game,therefore protecting them from any challenge by a state of a lottery law violation,” said Bill Heberer,an attorney for the law firm Hall Dickler Kent Goldstein & Wood in New York.
Heberer has worked for the Fantasy Sports Trade Association and many of its members in an effort to avoid legal trouble with the setup of their fantasy leagues.
Fantasy leagues have not been challenged by states for violating gaming laws. However,Heberer said if leagues that charge an entry fee do not emphasize the skill involved in drafting and managing a fantasy team,it could be seen as an unauthorized lottery,which is illegal.
“In some sense,you don't really control the outcome of your team,” Heberer said.
He said he sometimes advises clients not to let people from states with broad gaming laws,such as Arizona and Louisiana,play the fantasy game.
Professional athletes' right of control over any use of their names for commercial purposes is another issue fantasy league operators need to be aware of,he said.
While publishing athletes’ statistics is legal under the First Amendment,it can be argued the fantasy leagues are making money off athletes’ names,especially if they show pictures of the athletes,Heberer said.
He said neither the National Football League Players Association nor any other group has challenged fantasy sports,probably because there is a lot of money involved,and the players would get nothing if they lost a court battle.
“The case law is not a slam dunk in either direction,” Heberer said. “There's a lot to lose if you came out on the wrong side of the case.”