A Farmer Of Louisiana, Not An Insider Trading Scandal

A farmer in Louisiana, not an insider trading scandal, will destroy the multibillion dollar daily fantasy sports (DFS) industry. DFS is a rapidly growing segment of the online sports gaming industry where popular sites have grown by approximately 300% over the last year and are currently valued at over $1 billion (Miller Singer, 2015). Leung (2015) describes the basic DFS tournament as a weekly tournament where professional athletes are allocated a value based on past performance. She says that participants are allocated a ‘salary cap’ and create a roster based on the sum of those athletes’ values, until they reach their cap. Leung also shows how a participant’s score is determined by the performance of their selected athletes that†¦show more content†¦Since the actions of the major online gambling sites promote, and will continue to promote, usage by individuals in states that outlaw online gambling, the sites should be illegal on the federal lev el since they violated the UIGEA. In states where DFS are currently legal DFS sites operate within the confines of the existing laws, and they should be considered completely legal under the current law. Most states currently permit DFS, as they are not seen as predominantly games of chance (Huffman, 2014). Miller Singer present the widely cited statistic that 91 percent of all DFS profits are won by just 1.3% of players (2015). This statistic shows that there has to be some talent involved in DFS for a few individual to collect the majority of the profits. If DFS was entirely based off of chance the profits would be distributed in a random manner. Since the UIGEA explicitly permitting fantasy sports that are (1) for a value not dependent by the amount of participants or fees, (2) not dependent on the outcome of any real-world games, and (3) determined by the skill of the participants DFS are legal federally (Huffman, 2014). Additionally, the determination of the skill component is entirely left up to the individual states to decide what constitutes a game of chance and what constitutes a game of skill (Huffman, 2014). Most states use the predominant purpose test to determine whether to classify a game as a game of chance