DraftKings Inc. and FanDuel Inc. have been forced to cancel signature live fantasy sports events that were scheduled to take place in Las Vegas this December.
The companies can no longer hold their lavish tournaments, at which top daily fantasy sports players will compete for millions of dollars in cash prizes, in Las Vegas after the Nevada Gaming Control Board ruled on October 15 that such contests constitute gambling under that state’s laws. The board said companies must obtain Nevada gambling licenses to operate fantasy contests for cash; both DraftKings and FanDuel stopped accepting entries from Nevada after the decision.
The Nevada order pointedly said that existing gambling licensees in the state — such as Las Vegas casinos — “should exercise discretion is participating in business associations with [daily fantasy sports] operators that have not obtained Nevada gaming approvals.”
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FanDuel said on its website that it is looking for a new location for its tournament. A DraftKings spokeswoman said its contest will be moved to San Diego but would not name the venue.
DraftKings, headquartered in Boston, had planned to hold the qualifying round of its 2015 Fantasy Football World Championship at the Wynn Las Vegas resort and casino from December 17 to 21.
A spokesman for Wynn said that the casino company called DraftKings on October 15, the same day the gambling board issued its decision, to say it could no longer host the event.
“[DraftKings] received communication from us as soon as the commission made its decision,” Wynn spokesman Michael Weaver said Thursday. “We can’t work with them in Nevada.”
As of Thursday afternoon, DraftKings was still advertising on its website that the event would take place in Las Vegas, saying 200 qualifying players would each get a travel package worth $80,000, including “accommodations at the luxurious Wynn Las Vegas, host of our ultimate live event viewing experience.” The ten top players were to advance to a final round in Los Angeles dubbed “the biggest fantasy contest of all time,” where the top prize is $5 million.
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The FanDuel championship is billed as a chance for 120 of its customers who win qualifying events this month to “know what life looks like on top of the world.” Contestants get a “VIP trip package” and will compete for $13 million in total prizes, with a grand prize of $3 million, according to FanDuel’s website.
After surging in popularity amid an aggressive advertising push, both fantasy companies became mired in controversy over the past month. Their largely unregulated industry is under investigation by federal authorities in three states, and public officials and some players have raised questions about the fairness of the games after a DraftKings employee in September prematurely published data on the company’s contests.
In Massachusetts, Attorney General Maura Healey and the Massachusetts Gaming Commission are also reviewing daily fantasy sports. House Speaker Robert A. DeLeo said Wednesday the Legislature would likely take up a bill spelling out regulation of fantasy contests for cash.
Dan Adams can be reached at dadams@globe.com. Follow him on Twitter @DanielAdams86.