Make us your home page

Pinellas lawsuit alleges DraftKings, FanDuel are illegal gambling sites

Devlin D’Zmura, a tending news manager at daily fantasy sports company DraftKings, works on his laptop at the company’s offices in Boston.

Associated Press

Devlin D’Zmura, a tending news manager at daily fantasy sports company DraftKings, works on his laptop at the company’s offices in Boston.

Nelson C. Steiner's lawyers say he doesn't spend time on fantasy sports websites where participants can win big cash awards based on the real-life performance of professional athletes.

Steiner, once described as the baron of Tampa Bay's mobile home industry, has never lost a dime on two of the most-popular sites, FanDuel and DraftKings.

Still, the St. Petersburg resident is suing both.

Steiner's attorneys filed suit in Pinellas-Pasco Circuit Court on Monday accusing the companies of operating illegal gambling in Florida and depriving the state of substantial tax revenue.

The suit asks a judge for an injunction to stop FanDuel and DraftKings from collecting money from customers in Florida and ultimately seeks the forfeiture of any illegal proceeds to the state of Florida. A judge could ultimately award Steiner money if the suit is successful.

"We believe the entire wagering pool is an illegal collection of money and the defendants should be required to disgorge the entire amount they have collected from Florida residents," said attorney Guy Burns with the Tampa Bay firm of Johnson, Pope, Bokor, Ruppel & Burns, which represents Steiner. "They're taking a staggering amount of money out of the Florida economy."

Steiner, 72, will not comment about the litigation, his attorneys said. A spokeswoman for FanDuel declined to comment, and DraftKings did not return messages.

The suit is the latest, and perhaps most unusual, challenge to the multibillion-dollar fantasy sports industry, which is facing a vigorous legal assault on multiple fronts across the nation, including a federal grand jury investigation in Tampa.

On Tuesday, New York's attorney general told FanDuel and DraftKings to stop taking bets in that state because their games amount to illegal gambling.

Steiner's lawyers, who are not working with Florida officials, are using a seldom-used provision of Florida law that has been more typically employed to allow those harmed by an illegal gambling operation to seek damages.

Burns said past cases have included a scenario in which a husband loses the rent money gambling and his wife files suit to recover the loss. But he said the law nonetheless allows somebody like Steiner to sue even if he has not suffered harm.

The law firm broached the idea of the suit with Steiner, a real estate investor and mobile home park owner who was a previous client, Burns said.

This provision of law, Burns acknowledged, has not been used in many years, and he said those existing instances he has seen in case law are "pretty old and cold."

The law requires the plaintiff to notify the local state attorney, and since Steiner lives in Pinellas, the lawyers sent a copy of the lawsuit to Pinellas-Pasco State Attorney Bernie McCabe.

The law allows McCabe to take over the case if Steiner doesn't diligently pursue the litigation, Burns said.

Steiner's lawsuit said the DraftKings and FanDuel websites engage in "seductive" advertising that entices participants with the potential of rich winnings.

In 2014, the suit said, Draft­Kings alone flooded Florida with 1,782 TV ads. In September 2015, the website spent $23.6 million on television advertising in Florida, the lawsuit said.

"It is well established that gambling adversely affects the public welfare," the lawsuit said.

And since Florida allows some gambling that generates tax revenue, "illegal gambling deprives the state of legitimate tax revenues which would be received if the illegal wagering were done under proper state laws."

And those legal gaming activities create jobs and provide economic benefits, the suit said.

The websites work by allowing participants, who usually pay a fee to enter, to draft teams of real professional sports players. Entrants then compete using the real-life statistics generated by the players. Winnings, the New York Times said, can approach $2 million.

But in 1991, then-Florida Attorney General Robert Butterworth wrote an advisory opinion concluding Florida law "prohibits the operation and participation in a fantasy sports league whereby contestants pay an entry fee for the opportunity to select actual sports players to make up a fantasy team whose actual performance statistics result in cash payments from the contestants' entry fees."

No fantasy sports company, however, has been prosecuted under Florida law.

A bill filed this week by state Sen. Joe Negron and Rep. Matt Gaetz would declare that fantasy sports are games of skill and not forms of gambling.

Under the proposal, Florida would create new regulations forcing companies like Draft­Kings and FanDuel to put in safeguards to prevent underage participants and bar employees of fantasy sports sites and their relatives from manipulating results, as they have been accused of doing in other states.

Fantasy sports companies also would have to pay $500,000 each to operate in Florida and $100,000 annually. Negron said those hefty fees would pay for creating the regulatory enforcement arm, rather than making taxpayers foot the bill.

Times researcher John Martin contributed to this report. Contact William R. Levesque at or (813) 226-3432. Follow @Times_Levesque.

Pinellas lawsuit alleges DraftKings, FanDuel are illegal gambling sites 11/11/15 [Last modified: Wednesday, November 11, 2015 9:41pm]
Photo reprints | Article reprints

© 2017 Tampa Bay Times


Join the discussion: Click to view comments, add yours

  1. In advertising, marketing diversity needs a boost in Tampa Bay, nationally


    TAMPA — Trimeka Benjamin was focused on a career in broadcast journalism when she entered Bethune-Cookman University.

    From left, Swim Digital marketing owner Trimeka Benjamin discusses the broad lack of diversity in advertising and marketing with 22 Squared copywriter Luke Sokolewicz, University of Tampa advertising/PR professor Jennifer Whelihan, Rumbo creative director George Zwierko and Nancy Vaughn of the White Book Agency. The group recently met at The Bunker in Ybor City.
  2. Tampa Club president seeks assessment fee from members


    TAMPA — The president of the Tampa Club said he asked members last month to pay an additional assessment fee to provide "additional revenue." However, Ron Licata said Friday that the downtown business group is not in a dire financial situation.

    Ron Licata, president of the Tampa Club in downtown Tampa. [Tampa Club]
  3. Under Republican health care bill, Florida must make up $7.5 billion


    If a Senate bill called the Better Care Reconciliation Act of 2017 becomes law, Florida's government would need to make up about $7.5 billion to maintain its current health care system. The bill, which is one of the Republican Party's long-promised answers to the Affordable Care Act imposes a cap on funding per enrollee …

    Florida would need to cover $7.5 billion to keep its health care program under the Republican-proposed Better Care Reconciliation Act of 2017.  [Times file photo]
  4. Amid U.S. real estate buying binge by foreign investors, Florida remains first choice

    Real Estate

    Foreign investment in U.S. residential real estate recently skyrocketed to a new high with nearly half of all foreign sales happening in Florida, California and Texas.

    A National Association of Realtors annual survey found record volume and activity by foreign buyers of U.S. real estate. Florida had the highest foreign investment activity, followed by California and Texas. [National Association of Realtors]
  5. Trigaux: Tampa Bay health care leaders wary of getting too far ahead in disruptive times


    Are attempts to repeal Obamacare dead for the foreseeable future? Might the Affordable Care Act (ACA), now in dire limbo, be revived? Will Medicaid coverage for the most in need be gutted? Can Republicans now in charge of the White House, Senate and House ever agree to deliver a substitute health care plan that people …

    Natalia Ricabal of Lutz, 12 years old, joined other pediatric cancer patients in Washington in July to urge Congress to protect Medicaid coverage that helped patients like Ricabal fight cancer. She was diagnosed with Ewing's sarcoma in 2013 and has undergone extensive treatments at BayCare's St. Joseph's Children's Hospital in Tampa. [Courtesy of BayCare]