DraftKings lawyer: Case based on whether daily fantasy is skill-based

David Boies, the high-profile attorney for daily fantasy operator DraftKings, said in a Friday conference call that New York Attorney General Eric Schneiderman is entitled to change his mind about the legality of daily fantasy sports but "he is not entitled to unilaterally change the law."

Boies, chairman of firm Boies, Schiller & Flexner, will represent DraftKings in a Wednesday hearing in New York Supreme Court. Schneiderman is seeking a preliminary injunction to shut down DraftKings' and top competitor FanDuel's operations in New York.

"FanDuel has been openly operating these contests in New York for almost eight years," Boies said in an opening statement. "DraftKings, itself, has been openly offering these contests in New York for almost four years. Never, until about 10 days ago, had anyone, not the attorney general, not anybody in the attorney general's office, not any other public official, suggested, hinted, asserted that there was anything illegal about what FanDuel and DraftKings were doing."

Boies said the case will hinge on whether daily fantasy sports is a game of skill. However, Schneiderman, in a Thursday op-ed in the New York Daily News, said the case is more based on part of New York law that prohibits sports wagering, defined as "betting money on a future event outside of the gambler's control -- regardless of skill involved."

The DraftKings lawyer said the skill involved in daily fantasy sports proves that contestants are able to influence the game and therefore it is not gambling under New York law.

"As I say, anybody who believes that daily fantasy sports players do not control or influence how they do in those contests has never played those contests," Boies said. "Those contests require a great deal of skill, and skill is what gives people the ability to influence or control the outcome. So once it's conceded that this is a game of skill, you inevitably, I think, have to conclude that the player has an ability to control or influence the outcome.

"It's also the case that, if you look at what the attorney general himself said in that Daily News article, less than 11 percent of players repeatedly win almost all the prizes. That doesn't happen when players cannot influence the outcome."

Gambling laws vary from state to state, with the majority using a predominance test to determine which activities are games of skill and which are games of chance. New York law, however, states that activities that involve a "material element of chance" qualify as gambling.

"In every game of skill, there is some chance, even in chess," Boies said. "Even with games that are predominantly of chance, there can be some skill involved. So the question is a practical one: Does skill predominate, or does chance predominate?"

Boies also referenced baseball great Pete Rose, who was banned from the game for betting on the sport and his own team.

"But if he did that, it clearly would be lawful under New York law. Now, would that have been gambling? In a normal sense of the use of the word, sure. But that would not have been unlawful gambling under New York law."

Wednesday's hearing is scheduled for noon ET in front of New York Supreme Court Justice Manuel Mendez. Boies said he didn't know if Mendez would be able to make a ruling that day.