DraftKings Explores Back-Door Entry in Illinois Betting Market
According to the latest update on the Illinois Gaming Board’s website, a company owned by DraftKings – Crown IL Gaming LLC – applied for a management services license for sports betting on April 28.
DraftKings has not confirmed its intentions, but it seems that the daily fantasy sports turned sports betting operator will not be seating patiently and observing sports betting action in the state from the sidelines.
Illinois legalized sports betting last summer. However, the state’s wagering law contains a so-called bad actor clause for daily fantasy sports companies that used to run DFS contests on the territory of the state before Illinois Attorney General Lisa Madigan wrote in a 2015 opinion that the activity constituted illegal gambling.
Under the bad actor/penalty box provision, companies like DraftKings and FanDuel must wait for 18 months before being able to apply for online-only wagering licenses from the Illinois Gaming Board.
And as we’ve mentioned FanDuel, it should be noted that the other major American DFS turned sports betting operator has too explored a move similar to DraftKings’. And while DraftKings is yet to find a land-based casino in Illinois to partner with for speedier entry into the local market, FanDuel already has such a partner.
FanDuel teamed up with regional casino operator Boyd Gaming in August 2018. That partnership could now help the digital gambling company to debut its offering in Illinois much sooner than expected. Boyd Gaming runs the Par-A-Dice casino in East Peoria, Illinois.
Wait Not Over
While FanDuel and DraftKings might have found some way around Illinois’ penalty box provision, the future of the two operators in the state still lies with the Illinois Gaming Board. And it has the power to delay its decision for as long as it wants.
Boyd, FanDuel’s partner in the state, in March obtained a temporary sports betting license from the gambling regulator. This could facilitate the sports betting operator’s Illinois entry.
However, as mentioned earlier, DraftKings is yet to find a local partner. Most of the state’s casino owners have already announced digital sports wagering partners. The sports betting operator thus has a somewhat limited choice.
Harrah’s Joliet, owned by Caesars Entertainment Corp., Jumer’s Casino, owned by Delaware North, and Casino Queen, an employee-owned business, are three of the possibilities.
Caesars has an active agreement with DraftKings to provide “market access for online gaming products.” On the other hand, Delaware North works with IGT in West Virginia and IGT partners with DraftKings at Scarlet Pearl Casino in Mississippi.
It is now to be seen whether the Illinois Gaming Board would give the nod to DraftKings and FanDuel’s attempts at early market entry or would find a way to force the two operators to wait through the 18-month penalty box period.
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