Steptoe & Johnson Now Counts Daily Fantasy Sports Site, Adelson As Clients

What Do FanDuel And Sheldon Adelson’s Online Gambling Ban Have In Common? This High-Powered D.C. Lobbyist

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A high-powered D.C. lobbying firm advocating a ban on regulated online gambling via the Restoration of America’s Wire Act is now also retained by daily fantasy sports site FanDuel.

Strange bedfellows indeed.

A pair of very different clients

The connection was first made by Politico (subscription story here, tip sheet here):

FanDuel […] revealed it hired a Washington lobbyist for the first time. The firm, Steptoe & Johnson, also represents Sheldon Adelson‘s Las Vegas Sands in the push for banning online poker.

That push, of course, is RAWA, a bill that has gained very little traction in Congress (a panel held last week to rally support for RAWA last week reportedly drew just one attendee). The lobbyist who reportedly authored RAWA is a partner at Steptoe.

And now Steptoe now also represents FanDuel, one of the two giant daily fantasy sports companies now valued at over a billion dollars (along with DraftKings).

Steptoe is the first D.C. outside lobbying hire made by FanDuel, reports TheHill. The hire comes in the wake of concerns raised about employee access to contest data that have garnered significant media attention.

“A clear conflict of interest”

“This appears to be a clear conflict of interest,” John Pappas, head of the Poker Player’s Alliance, told OnlinePokerReport. “The arguments that state and federal lawmakers are making about DFS, and which Steptoe will have to defend, are the exact same arguments Mr. Adelson and the Coaltion To Stop Internet Gambling are making about online poker.”

“How can Steptoe tell Congress on one day that DFS can be appropriately controlled, and then on the next day tell Congress it needs to ban online gambling because it cannot be controlled,” Pappas continued. “Sadly, Washington is immune to this type of hypocrisy.”

RAWA’s goal is to ban regulated online gambling.

FanDuel and other daily fantasy sports operators, meanwhile, assert that they’re not a gambling product based on a federal carveout from the Unlawful Internet Gambling Enforcement Act and its status as a “skill game” in 45 states.

But many others argue that DFS is just a form of online gambling operating in an unregulated environment.

Daily fantasy sports exempted from RAWA

It’s interesting to note that DFS — despite the fact that it appears to be of the class of activity that RAWA and Adelson would want to target — has avoided inclusion in the bill.

The Wire Act, as it stands, only covers sports betting online, according to a Department of Justice opinion from September 2011.

RAWA attempts to expand the Wire Act’s reach to online gambling and poker, but it has not targeted daily fantasy.

The bill exempts “any activities set forth in section 5362(1)(E) of title 16 31” (review that list here). Such activities include fantasy sports, insurance, securities and related industries that are excluded from the definition of “bet or wager.”

So, while it may seem strange that Steptoe is representing both Adelson and FanDuel, the two clients are not technically in opposition to one another.

At least not right now.

- Dustin Gouker has been a sports journalist for more than 15 years, working as a reporter, editor and designer -- including stops at The Washington Post and the D.C. Examiner. He has played poker recreationally for his entire adult life and has written about poker since 2008.
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