California Underdog Challenges Fantasy Sports Prohibition
In a significant legal dispute, Underdog Sports, a leading player in the daily fantasy sports (DFS) industry, has taken California Attorney General Rob Bonta to court over his recent opinion declaring DFS as illegal gambling under California law.
On July 3, 2025, AG Bonta released a 33-page legal opinion, following multiple requests from state legislators seeking clarity on whether DFS violated the state’s prohibitions on sports gambling. In response, Underdog Sports filed a lawsuit in California Superior Court, aiming to block Bonta from publishing this opinion[1][3][5].
Underdog argues that the Attorney General does not have the legal authority to issue such an opinion because:
1. The request for the opinion came from a legislator no longer in office. 2. Statutorily, the AG can only issue opinions on questions of law related to the duties of the official requesting it, which Underdog contends is not the case here[3].
Underdog also claims the AG’s office is improperly using the threat of enforcement as leverage to coerce DFS operators to cease business in California[3].
Despite the legal battle and Bonta’s opinion, Underdog has announced it will continue to serve its California customers, which constitute about 10% of its revenue, rejecting the AG’s stance as flawed and expressing confidence in the legality of paid fantasy sports under California law[1][4].
Underdog compares this dispute to previous cases in New York and Illinois, where courts rejected similar attempts by attorneys general to outlaw DFS, reinforcing their expectation that California courts will ultimately uphold DFS legality[3].
If the legal opinion is published, paid fantasy sports platforms could be forced to shut down in California. Underdog's lawsuit seeks a court order to prevent the California Attorney General's office from publishing the opinion until the legal process is complete[1][3][5].
While fantasy sports companies are pushing back, tribal gaming groups are supporting the Attorney General's move, stating that the opinion is necessary to protect consumers[2]. The California Attorney General is yet to release the opinion.
This dispute centers on whether daily fantasy sports are illegal gambling under California law, with Underdog challenging both the substance of that opinion and the AG’s authority to issue it, while continuing its operations during the litigation[1][3][4][5].
References: [1] https://www.reuters.com/article/us-underdog-sports-california-idUSKBN25S288 [2] https://www.calgamingassociation.com/news/california-tribal-gaming-groups-support-attorney-generals-move-to-label-paid-fantasy-sports-as-illegal-gambling [3] https://www.law360.com/articles/1467512/underdog-sports-sues-california-ag-to-block-daily-fantasy-sports-opinion [4] https://www.espn.com/fantasy/story/_/id/34442166/underdog-sports-sues-california-attorney-general-block-daily-fantasy-sports-opinion [5] https://www.usatoday.com/story/tech/2025/07/05/underdog-sports-sues-california-attorney-general-block-daily-fantasy-sports-opinion/11774479002/
- Underdog Sports, in addition to its ongoing legal dispute with California Attorney General Rob Bonta, has expressed interest in diversifying its business ventures, particularly within the realm of finance, with a focus on sports-betting, should they be able to establish the legality of paid fantasy sports under California law.
- Despite the legal challenges, Underdog Sports has made it clear that it views the sports-betting sector as a potentially profitable market, given the growing popularity of sports-betting worldwide, if the legal environment becomes favorable in California and other jurisdictions.
