The Honorable William P. Cole III
AGO 070716
No. 070716
West Virginia Attorney General Opinions
State of West Virginia Office of the Attorney General
July 7, 2016
The
Honorable William P. Cole III
President
of the Senate
Building
1, Room 229M
1900
Kanawha Boulevard, East
Charleston,
WV 25305
Dear
President Cole:
You
have asked for an Opinion of the Attorney General about
whether offering or participating in certain fantasy sports
games is legal in West Virginia. This Opinion is being issued
pursuant to West Virginia Code § 5-3-1, which provides
that the Attorney General shall "render to the president
of the Senate ... a written opinion or advice upon any
questions submitted to the attorney general . . . whenever he
or she is requested in writing so to do." To the extent
this Opinion relies on facts, it is based solely upon the
factual assertions set forth in your correspondence with the
Office of the Attorney General or upon the sources cited.
Your
letter raises the following legal question:
Whether West Virginia prohibits or criminally sanctions
the offering of or participation in fantasy sports games, as
defined in Senate Bill 529.
BACKGROUND
Generally
speaking, participants in a fantasy sports league
"simulate being a sports team owner or
manager."
1 Participants select a lineup of real
athletes from real-world sports leagues— such as the
National Football League, Major League Baseball, the National
Basketball Association, or the National Hockey
League—within the limits of either a draft or a
fictional salary cap, and then win points for their fantasy
sports teams based on the accumulated statistical performance
by their team of athletes in real-world games.
[2] A fantasy
baseball manager, for example, might win points for each of
his hitters' hits, home runs, stolen bases, and walks, as
well as points based on his pitchers' earned runs,
strikeouts, innings pitched, and saves.
[3] Because a fantasy
team consists of individual players from many real-world
teams, the actual outcomes of real-world games do not count
toward points in fantasy leagues.
4
Fantasy
sports leagues operate in varying capacities in most states
in the nation. Some leagues are free to play and may or may
not award prizes; others charge entrance fees and give out
cash prizes,
5 Some last a day; others a
season.
6 At present, pay-to-play online fantasy
sports games operate in forty states,
7 including West Virginia. Ten
states currently have no fantasy sports operations: Alabama,
Arizona, Hawaii, Idaho, Iowa, Louisiana, Montana, New York,
Nevada, and Washington.
8
Officials
and legislatures in several states have addressed the
legality of pay-to-play fantasy sports leagues under state
law. Some state attorneys general, such as those in Kansas,
Massachusetts, and Rhode Island, have found pay-to-play
fantasy sports leagues to be lawful. Other state attorneys
general, including those in Nevada, New York, and Texas, have
found them to be unlawful. In at least eight states,
including Indiana, Tennessee, and Virginia, the legislatures
have passed laws directly authorizing pay-to-play fantasy
sports.
9
During
the last legislative session, one chamber of the West
Virginia Legislature took steps toward clarifying the
legality of fantasy sports in our state. By an 18 to 16 vote,
the Senate passed Senate Bill 529, which provides that state
law does not criminally prohibit the offering of or
participation in "fantasy games." Committee
Substitute, W.Va. S. 529 (2016). A "fantasy game"
is defined as a "fantasy or simulation sports game or
educational game or contest" in which:
(1) The value of alt prizes and awards offered to winning
participants is established and made known to the
participants in advance of the fantasy game.
(2) All winning outcomes reflect the relative knowledge and
skill of participants and are determined predominantly by
accumulated statistical results of the performance of
individuals, including athletes in the case of sporting
events.
(3) A winning outcome is not based on the score, point spread
or performance of a single team or combination of such teams,
or on any single performance of an individual athlete or
player in a single event.
Id. The House of Delegates did not vote upon this
bill before the legislative session concluded.
Although
some fantasy sports games are free to play or offer no
prizes, this Opinion concerns only the legality of fantasy
sports games played for money. Your question is limited
specifically to whether West Virginia prohibits or criminally
sanctions the offering of or participation in fantasy sports
games, as defined in Senate Bill 529. As noted
above, Senate Bill 529 defines fantasy games as those that
offer prizes and awards to winning participants.
DISCUSSION
We
conclude that West Virginia does not prohibit the offering of
or participation in fantasy sports games, as they are defined
in Senate Bill 529. We read state law to prohibit only
betting upon games decided at least predominantly by chance.
Fantasy sports games, as defined in the Senate Bill, are not
so decided. Rather, they are determined predominantly by
skill, knowledge, and athletic performance. Because you have
not asked, we do not specifically address whether particular
fantasy sports games meet the Senate Bill's definition.
But we do note that fantasy sports games, as we have
described them in the background discussion above, are likely
not decided predominantly by chance.
We
further conclude that this Opinion is consistent with the
decisions of most other state attorneys general regarding the
legality of fantasy sports games. Those state attorneys
general who have found their state laws to prohibit only
betting upon games decided predominantly by chance, as we
have determined about West Virginia law, have similarly found
pay-to-play fantasy sports games to be lawful in their
states. In contrast, in those states where fantasy sports
games have been found unlawful, the state attorneys general
have found state gambling laws to apply more broadly than in
West Virginia, prohibiting betting in many more games than
simply those where chance predominates.
I. West Virginia Does Not Prohibit
Fantasy Sports Games Played As Defined In Senate Bill
529.
A.
State law prohibits betting on private lotteries and other
"games of chance."
Pursuant
to a constitutional directive regarding lotteries, the West
Virginia Legislature has prohibited some forms of gaming.
Article VI, Section 36 of the West Virginia Constitution
specifically forbids private lotteries.
[10] Accordingly,
there are several provisions of the West Virginia Code that
ban private lotteries and other games of
chance.
11
But the
Legislature "has not deemed it necessary to prohibit all
forms of gaming." State v. Gaughon, 55 W.Va.
692, 48 S.E. 210, 212 (1904). Under an express exception to
the constitution's ban on lotteries, the Legislature has
enacted laws permitting state-operated lotteries (which
include table games at casinos)
12 and state-regulated
bingos and raffles by charitable organizations.
[13] Moreover,
as the Supreme Court of Appeals has observed, "[m]any
games may be played in private places" in West Virginia.
Id By failing to enact further statutory
prohibitions, "[t]he Legislature has, in effect, said
that people may indulge in certain games of amusement, or
even bet on them." Id.
14
The
question, thus, is whether the statutory prohibitions on
private lotteries and other "games of chance" apply
to online fantasy sports games.
B. The statutory prohibitions on private lotteries
and other "games of chance" apply to any games
decided wholly or predominantly by chance.
Several
statutes in Article 10 of Chapter 61 of the West Virginia
Code prohibit private lotteries and other games of chance.
Specifically, under Section 61-10-11, it is unlawful to play
any private "lottery or raffle" that is won by
"using dice, or by any other game of
chance."
15 And under Section 61-10-5, it is unlawful
to "bet or wage money or other thing of value on any
game of chance."
16
For a
number of different reasons, we conclude that these statutes
are best interpreted to refer only to games decided wholly or
predominantly by chance.
1. We
look first to multiple opinions of the Supreme Court of
Appeals, as well as opinions issued by previous West Virginia
attorneys general, which suggest that...
