FANALYTICS: This game is illegal

According to the Powers That Be, daily fantasy games are perfectly legal. They are games of skill; they are not gambling.

If only it was that cut and dried.

Back in 2005, I introduced a game called Quint-Inning. It was a fantasy contest built around a single major league game. It contained most of the same elements that are a part of today's daily games.

But Quint-Inning is illegal.

Well actually, I'm sure a bunch of us could play it in my basement without the feds crashing in, but it would be shut down pretty quickly if I tried to run it as a commercial operation.

Even though the core of the game is no different from what you'd find at FanDuel or DraftStreet.

Here is a Quint-Inning rules summary (also see page 48 in this year's Baseball Forecaster):

It starts with five owners each drafting five players from the rosters of two teams from a single major league game.

For batters, you get one point for a single, two points for a double, etc. For pitchers, you get a point for each scoreless inning and lose a point for each run allowed.

At the beginning of the 5th inning, each owner has the option of doubling any future points for one player on his roster. Beginning in the 9th inning, points for all batters are doubled.

Players may be dropped, added or traded at the end of each inning.

Owners need to ante up to play, typically $5. It then costs $1 per inning to stay in the game for the first four innings. Beginning in the 5th inning, the stakes increase to $2 per inning to stay in the game.

Owners can fold at any time, forfeiting any monies they contributed to the pot. Their players are released into the free agent pool and are available to the remaining owners in reverse order of the standings.

The owner with the most points at the end of the game wins the pot.

There are a few other incidentals, but those are the basics. The game is intended as a side activity while a bunch of friends are watching a ballgame live or on TV.

The Unlawful Internet Gambling Enforcement Act (UIGEA)—which was passed the year after Quint-Inning was introduced—says that this game is illegal. Here is where we fall short:

The UIGEA says that a fantasy game is legal if...

1. All prizes and awards offered to winning participants are established and made known to the participants in advance of the game or contest and their value is not determined by the number of participants or the amount of any fees paid by participants.

Quint-Inning is a betting game with the final prize unknown until the game is completed. As such, it is illegal.

The UIGEA says that a fantasy game is legal if...

2. All winning outcomes reflect the relative knowledge and skill of the participants and are determined predominantly by accumulated statistical results of the performance of individuals (athletes in the case of sports events) in multiple real-world sporting or other events.

Quint-Inning is based on one real-world sporting event, not multiple events. As such, it is illegal.

The UIGEA says that a fantasy game is legal if...

3. No winning outcome is based: a. On the score, point spread, or any performance or performances of any single real world team or any combination of such teams; or b. Solely on any single performance of an individual athlete in any single real-world sporting or other event.

Quint-Inning meets this test.

But here's the thing... I can eliminate what is perhaps the most objectionable element of this competition—the betting—and it becomes pretty much no different from any other daily game... with the exception of it encompassing a single MLB contest. But is that enough to draw the distinction between it being a game of skill and a game of chance? Is that where we draw the line between passing the smell test versus incurring the wrath of the government?

A few months ago, attorney Glenn Colton was a guest on BaseballHQ Radio. He and his firm have been intimately involved in protecting the fantasy sports industry over the past decade. Here was a relevant exchange with host Patrick Davitt:

PATRICK: As you shorten the time span for the game—from a full season to one day—you move along a continuum away from skill towards chance. And by chance, aren't you really talking about gambling?

GLENN: How much skill is involved does not necessarily correlate with how long a season is. How many decisions do you have to make? How many factors do you have to consider? How many players are you playing? How many statistics? To use a simple example, if you played a season long game that just measured home runs for hitters and wins for pitchers, as opposed to a daily game that measured 16 different statistics, I don't think we'd have a hard time arguing that the 16 statistics are tougher to measure than the two and therefore require more skill.

So, by Glenn's description, Quint-Inning—which requires decisions involving many statistics—should pass the test for "skill."

In fact, if we dig a bit deeper into the legal daily games, they can come perilously close to Quint-Inning in that regard.

Let's talk about stacking.

Stacking is the strategy of filling your daily roster with players from the same team. Stacking can provide great benefit because players on a single team are inextricably linked. A three-run HR, for instance, can be worth many points if you have both the baserunners and the batter in your lineup.

In fact, this research from Fangraphs shows that "your upside goes up by stacking more guys from the same team," though up to a limit.

Conceivably, you could stack your roster completely with the players from two opposing teams in a single MLB game. There are some game companies that do allow "full-team stacks." That would make those games indistinguishable from Quint-Inning.

And illegal.

But most of the daily game companies do know that this is the line they can't cross. That's why FanDuel limits your ability to stack by requiring players from three different teams. DraftStreet will only let you use four players from the same team on a given day. In games with 12-man rosters, it ensures that everybody drafts from more than a single MLB contest.

But really, it's an artificial restriction. It's intended solely to keep these games on the right side of the law. It has little to do with the issue of skill versus chance. It's an arbitrary rule added as a veiled nod to the UIGEA.

I could play nice with the authorities too, expanding Quint-Inning to encompass two MLB games. That—and eliminating the betting—is all it would take to make it legal. I could do that.

But it would eliminate one of the beauties of the game... the ability for a bunch of friends to sit in front of the TV on a Sunday night and play fantasy while they are watching the Red Sox and Yankees square off.

I don't see how that makes it any less of a game of skill than what you'll find on the daily gaming sites.

I wonder... what would happen if thousands of us all broke the law at the same time? Check out my Master Notes piece here tomorrow or on Baseball HQ Radio to find out how to play Quint-Inning at the All Star Game.


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  For more information about the terms used in this article, see our Glossary Primer.