Fantasy Sports Trade Association Defends Four Employees Fired By Fidelity Investments

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The fantasy sports industry extends its support for employees fired for playing fantasy football; rejects company's assertion that fantasy sports is gambling.

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The reason cited by Fidelity for the termination of these employees--that they gambled by playing fantasy sports--is troubling.

The Fantasy Sports Trade Association (FSTA) has been made aware of a situation in which four Fidelity Investments employees were terminated for perceived gambling in the form of fantasy sports.

The FSTA is disappointed by this action, as it furthers the incorrect perception that fantasy sports is linked to gambling.

"The FSTA recognizes each company's right to set guidelines for an employee's use of company assets and time for outside activities," said FSTA president Paul Charchian. "However, the reason cited by Fidelity for the termination of these employees-- that they gambled by playing fantasy sports--is troubling.."

Gambling law expert, Professor I. Nelson Rose, observes that, while fantasy sports may be considered gambling in a minority of states, “the government exempted fantasy sports from the Unlawful Internet Gambling Enforcement Act (UIGEA),” an action that reinforces the FSTA’s position that fantasy sports is not gambling.

Charchian continued, “Congress recognized the distinction between fantasy sports and criminal sports gambling, and wrote exclusionary language around fantasy sports play. No fantasy sports company has been the subject prosecution for gambling. No person has been the subject of prosecution for gambling related to fantasy sports participation."

Courts and federal government rulings definitively divide fantasy sports from gambling. In Humphrey v. Viacom (2007), the courts found that, “as a matter of law, the entry fees for … fantasy sports leagues are not ‘bets’ or ‘wagers’ because (1) the entry fees are paid unconditionally; (2) the prizes offered to fantasy sports contestants are for amounts certain and are guaranteed to be awarded; and (3) defendants do not compete for the prizes.” This ruling set the tone for the exclusionary UIGEA text that exempts fantasy sports from the UIGEA regulations, which are set to go into effect on Dec. 1, 2010.

According to a June 2009 FSTA study by research firm IPSOS, there are 27 million Americans aged 12+ playing fantasy sports.

Additional research commissioned by the FSTA via Dr. Kim Beason at the University of Mississippi indicates that:

  •     54% say fantasy sport participation increases the camaraderie among employees in their workplace.
  •     37% say fantasy sports participation is a positive influence in their workplace.
  •     16% say fantasy sports participation has allowed them to make valuable business contacts.

“Fantasy sports offers virtually-free workplace team-building, providing myriad benefits, including cross-functional communication,” said Charchian. “Restricting fantasy sports play chisels into workplace morale at a time when many companies are challenged by that very issue.”

Additionally, fantasy sports is embraced by all major sports leagues, players associations, and major media portals such as NBC, CBS, Fox, ESPN and Yahoo!

Added Charchian, "If there were any merit to Fidelity's suggestion that fantasy sports participation is gambling, these entities would very likely not support it."    

"The FSTA is happy to work with Fidelity to enhance their understanding of the legal issues around fantasy sports participation, especially surrounding the gambling distinction."

About the FSTA
The FSTA is the largest and oldest trade group representing the fantasy sports industry with over 120 members ranging from small startups to large media corporations. As the voice of the industry since 1998, the FSTA has been the leader in providing demographic data, annual conferences and collective action to ensure unfettered growth.

Related Links:

Fantasy Sports Trade Association: Visit http://www.fsta.org for more information.

Professor I. Nelson Rose: (http://www.gamblingandthelaw.com)

Star-Telegram (Ft. Worth, TX) article on the firing: http://www.star-telegram.com/business/story/1825336.html

Complete Text of the UIGEA: http://thomas.loc.gov/cgi-bin/query/F?c109:6:./temp/~c109YxQR7a:e220380

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Paul Charchian
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