Underdog Fantasy facing regulatory challenges in several states

February 28, 2024 1:49 PM
Photo: CDC Gaming illustration
  • Steve Chen — Special to CDC Gaming Reports
February 28, 2024 1:49 PM
  • Steve Chen — Special to CDC Gaming Reports
  • Massachusetts
  • Mississippi
  • North Carolina

Underdog Fantasy has notified its customers in North Carolina that its pick’em product has been turned off in the state, after earlier in the week shutting down its Mississippi platform and modifying its Massachusetts platform as more states are viewing some fantasy sports products as gambling.

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Monday’s announcement in North Carolina comes amid Underdog’s pending application for a sportsbook license with the North Carolina Lottery, where sports betting is due to launch on March 11 eight yet-to-announced sportsbooks.

Earlier this week, the Massachusetts Attorney General’s office issued letters to 10 daily fantasy sports operators that offer pick’em games in the state, demanding they stop offering pick’em, parlay and other games that are considered sports wagering. Although Underdog wasn’t among the companies that received the letter, it removed player vs. house pick’em competitions on Monday from its platform in the state, leaving only the peer-to-peer version for now. Pick’em contents are the company’s most popular product.

“In consultation with the Massachusetts Attorney General’s office, we’ve moved to our peer-to-peer pick’em product in Massachusetts,” said Stacie Stern, Underdog Fantasy’s vice president of government affairs and partnerships.

On Tuesday, the company shut down its Mississippi pick ’em contests. The Mississippi Gaming Commission sent a letter to Underdog and several other DFS operators in October, stressing that the state doesn’t allow player vs. house daily fantasy sports competitions, including pick’em. However, similar to North Carolina, the move comes now in light of Mississippi legislators contemplating legalizing online sports betting in the state and daily fantasy sports operators’ potential to get a sports betting license.

“Legally? No. Colloquially? It’s for people to determine. If you play a game of golf with a friend and bet on it, is that gambling?” Underdog Fantasy CEO Jeremey Levine replied when asked in the past if fantasy sports are gambling.