NY AG Sues Another Prediction Market Operator Over Alleged Unlicensed Gambling
New York's Attorney General sued another prediction market operator for allegedly running an unlicensed gambling business that accepted wagers on sports, elections, and entertainment outcomes.
The verified petition, filed in the Supreme Court of the State of New York, alleged the platform offered "event contracts" on outcomes such as Knicks and Mets games, a University at Albany-Buffalo football matchup, and the "New York Governor Election Winner," despite marketing itself as "legal in all 50 states." The Attorney General alleged the operator's parent is valued at more than $20 billion, earns over $1 billion in annualized revenue, and holds no license from the New York State Gaming Commission. The suit follows earlier petitions against other prediction market operators over alleged unlicensed gambling in the state (see prior coverage here and here).
The petition also alleged that the operator engaged in bookmaking by accepting more than five bets totaling over $5,000 in a single day, and that it kept electronic wagering records and bet confirmations typical of bookmaking operations.
The Attorney General claimed this conduct constituted repeated and persistent illegality under Executive Law § 63(12), citing violations of (i) the gambling prohibition in Article I, Section 9 of the New York Constitution; (ii) Penal Law §§ 225.05, 225.10, and 225.20, barring unlicensed gambling promotion and bookmaking records; (iii) Racing Law §§ 1367(16)(a), 1367-a(2)(a), and 1367-a(4)(b), requiring a Gaming Commission license for sports wagering; and (iv) the federal Wire Act, 18 U.S.C. § 1084(a), prohibiting interstate wire transmission of bets or wagering information.
The Attorney General is seeking a permanent injunction against unlicensed betting in New York, an accounting of customer bets and losses, restitution, disgorgement, damages, treble-gains penalties under Penal Law § 80.10, a $100,000 penalty per unauthorized sports-wagering offer under Racing Law § 1367(16)(a), and litigation costs under CPLR § 8303(a)(6).