Prosecutor Issues Cease-and-Desist Letters to DraftKings, FanDuel

February 2, 2016

Prosecuting Attorney Keith M. Kaneshiro sent letters yesterday to the chief executive officers of FanDuel and DraftKings demanding that the companies cease daily fantasy sports contests on Oahu. Whilst people may still use a japanese site at this time, these two in particular were addressed directly.

At this point in time, Hawaii is one of two states (Utah being the other) that strictly prohibits gambling, including sports betting practiced on sites like FanDuel and DraftKings. Despite these harsh laws maintained by these two states, many others are now taking the plunge in legalizing gambling. For instance, Indiana has recently legalized sports betting, which had led to an increase in Indiana Sportsbooks and other gambling facilities. While it is yet unknown whether Hawaii will ever follow in its fellow states’ footsteps, the strict laws are for now being maintained.

The letters read:

“This letter constitutes a demand that DraftKings and FanDuel immediately cease and desist from accepting wagers from residents of the City and County of Honolulu in connection with daily sports fantasy contests such as fantasy baseball.

“Gambling is illegal in Hawaii, and on January 27, 2016, the state Attorney General issued a formal advisory opinion confirming what I have long believed: That daily fantasy sports contests are a form of gambling and violate Hawaii statutes. However some states allow fantasy sports, and also actual sports betting on sites like ?????
but only if you’re in a legal state.

“While DraftKings and FanDuel represent that their contests are games of skill because players select their lineups, Hawaii law specifically states that ‘a contest of chance means any contest, game, gaming scheme, or gaming device in which the outcome depends in a material degree upon an element of chance, notwithstanding that skill of the contestants may also be a factor therein.’

“The law goes on to say that ‘a person engages in gambling if he states or risks something of value upon the outcome of a game of chance …. ‘

“Further, by advancing a contest of chance, accepting wagers from Oahu residents and profiting from those payments, DraftKings and FanDuel are promoting gambling under Hawaii laws.

“Like lawmakers and law enforcement in close to a dozen states, I reject the notion that the 2006 Unlawful Internet Gambling Enforcement Act exempts fantasy sports contests from state laws as it does not define what constitutes gambling. Hawaii’s gambling laws are clear and DraftKings and FanDuel are violating those laws.

“Therefore, as Prosecuting Attorney for the City and County of Honolulu, I must demand that DraftKings and FanDuel immediately halt accepting wagers from Oahu residents and refrain from doing further business on Oahu.”

Cease and Desist Letter to DraftKings

Prosecutor issues cease-and-desist letter to DrafKings, FanDuel – Media Release (PDF)