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A Judge Has Banned DraftKings and FanDuel From Operating in New York

The judge upheld the belief that DraftKings and FanDuel are nothing but a "multibillion-dollar scheme intended to evade the law and fleece sports fans."

DraftKings co-founder Matt Kalish. Photo via Web Summit

In November New York state attorney general Eric T. Schneiderman ordered the nation's two biggest fantasy sports sites, FanDuel and DraftKings, to stop taking bets in his state. "It is clear that DraftKings and FanDuel are the leaders of a massive, multibillion-dollar scheme intended to evade the law and fleece sports fans across the country," Schneiderman said in a statement at the time.

The two companies disagree, of course, and have long contended that there's is a game of skill, not chance, and therefore what goes on at their sites should not be considered gambling. New York Supreme Court Justice Manuel Mendez disagrees, and on Friday barred the companies from operating in New York. In his decision, Mendez cites "a likelihood of success on the merits" of Schneiderman's case against the sites.

Mendez's decision essentially squashes DraftKings and FanDuel's attempts to block Schneiderman's cease and desist order, and they won't be allowed to operate in the state pending a trial to determine whether or not fantasy sports should be considered illegal gambling. Mendez also waived the right to a speedy trial, writing in his decision "the protection of the general public outweighs any potential loss of business," according to the New York Post.

Both DraftKings and FanDuel plan to appeal the ruling, reports Reuters, and in a statement about the decision FanDuel wrote "New Yorkers have been able to legally play our games for more than six years, and today's preliminary decision was wrong and we expect we will ultimately be successful."

UPDATE: ESPN reports that an appellate judge has issued an emergency temporary stay to the sites, which will allow them to continue operating in New York through the end of 2015.