The Canadian Gaming Association, a trade group whose stakeholders include casinos, said it has obtained a legal opinion claiming daily fantasy sports games are illegal under the Criminal Code of Canada.
TSN has learned the CGA commissioned Don Bourgeois, former general counsel for the Alcohol and Gaming Commission of Ontario, to examine the legal standing of fantasy sports. Bourgeois also worked as a lawyer with the Ontario attorney general for 10 years from 1991-2001.
The gaming association plans to share Bourgeois’s report in the coming days with the current provincial attorneys general and also may contact local police about his findings, said Paul Burns, a CGA spokesman.
Burns said he would not share Bourgeois’s report, which is about 15 to 20 pages, with the public before it was distributed to government officials.
The NHL, for instance, is an investor in DraftKings. In July, the company announced a new round of funding worth $300 million. Investors included Fox Sports, the NHL, Major League Soccer and New York sports company Madison Square Garden.
Major League Baseball also has an equity stake in DraftKings and offers daily contests on MLB.com, while the NBA has an exclusive deal with FanDuel.
Maple Leaf Sports and Entertainment Ltd., the parent company of the Maple Leafs and Raptors, recently signed a landmark four-year sponsorship with DraftKings that pays Canada’s largest private sports company more than $1 million per year.
“Fantasy gaming companies say they are lawful in Canada because they are games of skill,” Bourgeois said in an interview. “I looked at it. Is it a game of skill? No, not for purposes of the Criminal Code. The Criminal Code of Canada says if a game is a game of mixed skill and chance then it is considered a game of chance. That’s gambling.”
It’s unclear whether sports leagues that have invested in daily fantasy sports companies have exposure – civil or criminal – after Schneiderman’s order.
“At the very least the leagues are putting their investments at risk,” Bourgeois said. “If you invest $10 million or $20 million in a company or a system that ends up being illegal in Canada or the U.S., do you get your money back? What was the due diligence of the investor’s board of governors?”