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Does Liability Insurance Cover Fantasy Sports Disputes?

By Lawrence Klein and Aaron F. Mandel
December 31, 2015

For years, people have been getting together to prove that they can draft and field a team of real-life athletes better than their friends. It used to be that fantasy sports had to be a season-long commitment. But some people (either on their own or at the urging of their significant others) did not want to take on that type of time commitment or incur the cost of competing in a full-season league. Enter daily fantasy sports (DFS), which has given sports fans a more efficient outlet to achieve the fantasy adrenaline rush by providing competitors with daily or weekly competitions open to almost everyone with an Internet connection.

The exponentially greater number of participants has led to an exponentially greater prize pool and the huge, multimillion dollar checks winners are shown receiving in the seemingly ubiquitous DFS commercials aired during sporting events and late-night infomercials. But the greater number of participants in DFS games is actually what makes those games so hard to win.

Every participant in a DFS game can select almost any athlete on any team to fill their roster, typically subject to a $50,000 salary cap, regardless of whether other DFS participants have also selected those athletes. (In DFS competitions, each available player is assigned a salary based on their perceived value. For example, it cost $8,500 to draft New England Patriots quarterback Tom Brady for DFS DraftKings' slate of Week 9 NFL games. New Orleans Saints backup quarterback Luke McCown, in contrast, has been available for $5,000.) DFS success, then, is based not only on drafting athletes who provide the greatest dollar-for-dollar return on investment, but also on drafting high-performing athletes whom other competitors do not select.

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