The New Jersey Division of Gaming Enforcement said it is reviewing a DraftKings tournament held during the divisional round of the NFL Playoffs.
Entrants were restricted to betting on two NFL playoff games played on the Sunday of the divisional round.
The first game, featuring the New England Patriots against the San Diego Chargers finished shortly before the start of the second game between the Philadelphia Eagles and the New Orleans Saints. Some players said their winnings from the first game were not processed fast enough to allow them to bet on the second game before it started.
DraftKings apologized for the confusion, but said it was simply following tournament rules.
“We recognize that in the rules the scheduled end of betting coincided very closely to the finish of the of Patriots-Chargers game,” said DraftKings spokesman James Chisholm in a press statement. “While we must follow our contest rules, we sincerely apologize for the experience several customers had where their bets were not graded in time to allow wagering on the Saints-Eagles game. We will learn from this experience and improve upon the rules and experience for future events.”
The Associated Press, however, highlighted the betting of Rufus Peabody, a professional gambler from Washington D.C. who was leading the tournament heading into the Saints-Eagles game with more than $81,000.
Peabody planned to bet on the Saints and the over-under, but could not get his bets on time. Both bets would have won and put him in the running for the $1 million top prize.
“I feel like it’s an issue of fairness, that some people’s bets were graded before others,” he told the wire service. “There’s a subset of people that had their bets graded and were able to bet on the second game and a subset of others that were not.”
DraftKings did not say how many entrants were unable to bet on the second game.
Peabody finished third in the tournament, winning a $250,000 prize. He also kept his $81,000 tournament bankroll.
DraftKings acknowledged that some competitors had their bets on the early game processed in time before the second game started.
“As with all mobile sports books, there is always some time period required for the back-end systems to grade the market and the pay out to occur,” Chisholm said.
In another matter, a recent filing cited by marketwatch.com shows DraftKings has hired lobbyists to “educate policymakers on issues related to fantasy sports and sports wagering.”
The company has employed Invariant LLC, which was previously known as Heather Podesta + Partners, to lobby on those issues, and a separate filing shows DraftKings also has hired Dunkel Government Relations LLC for lobbying work, the report said.
The hirings came before the U.S. Department of Justice released a new opinion of the Federal Wire Act that could cause legal problems for the daily fantasy sports industry. The DOJ said that the 1961 act could apply to other forms of gambling other than sports betting. The act makes it illegal to transport information on betting across state lines.
DFS contests are run on an inter-state basis and attorneys general in several states have ruled that the contests are gambling.
