Underdog Sues to Block California DA’s Opinion on DFS Legality

Underdog is asking a Sacramento Superior Court to intervene and block the California Attorney General from releasing his opinion on the legality of daily fantasy sports in the Golden State.

Big Business on the Line

Underdog has stated that 10% of its business comes from players in California and has asked a Superior Court judge to prohibit California Attorney General Rob Bonta from releasing his opinion on the legality of daily fantasy sports in the state. The company argues Bonta is not qualified to issue an opinion on the legality of DFS, and therefore, a ban emanating from his opinion would be unlawful.

“Without this Court’s immediate intervention, this unlawful gambit may succeed,” reads a memorandum of points supporting the request for a temporary restraining order. “Underdog faces imminent irreparable harm—from fleeing customers, risk-averse banks and payment processors, and the loss of investment and goodwill—if the Attorney General issues the opinion as planned.

“Because Underdog received only days’ notice of the legal tidal wave that will arrive by Thursday, it timely seeks an ex parte temporary restraining order (TRO) to preserve the status quo that has persisted in California for decades.”

Underdog Barks Back

Underdog contends that Bonta lacks the authority to issue such a declaratory judgment and is also insufficiently familiar with the industry.

“Absent relief from this Court, Attorney General Rob Bonta will issue an opinion later this week that will decimate fantasy sports in California,” reads the memorandum supporting the TRO request. “Attorney General Bonta should be enjoined from doing so, not because he is wrong in his views on the legality of fantasy sports—though he certainly is—but because by statute, the Attorney General can only issue opinions on questions of law and can only answer questions that relate to the duties of the official requesting the opinion.“

“Neither is true here. Thus, Attorney General Bonta lacks authority to issue the opinion and should be enjoined from doing so.”

Underdog Relying on Semantics

A representative for the Attorney General’s office said:

“When asked about the limits imposed by Section 12519, the representative responded that the California Department of Justice believes the Attorney General is obligated to answer all questions posed by legislators regardless of whether they are questions of law in requests for opinions under Section 12519.”

David Gringer of Wilmer Cutler Pickering Hale and Dorr LLP, representing Underdog, cited a guideline that includes when the AG should issue legal opinions, and this scenario would not be one of them.

According to the guidelines cited by AG Banta in a letter dated August 2022, opinions must be rendered only when “made by individual state legislators, but not by legislative committees or consultants.” Gringer notes that written legal opinions by the AG must be issued when asked by a legislator, but only when that opinion relates “to their respective offices.”

The opinion is expected imminently, but the temporary restraining order, if successful, could delay or eliminate that option entirely. However, if the court tosses Underdog’s suit, the AG’s opinion could be the basis of the end of DFS in California.