DraftKings and FanDuel are "nearing a settlement agreement with New York’s attorney general over claims that they engaged in false advertising when they spent nearly a half-billion dollars blitzing the national airwaves with commercials last year," according to sources cited by Joe Drape of the N.Y. TIMES. Sources said the agreement with AG Eric Schneiderman was "expected to cost the companies" a total of $8-12M. It would also "require the companies to acknowledge the findings" of Schneiderman’s investigation into "fraudulent practices and perhaps require them to institute even stronger consumer protections than those adopted" in August when New York Gov. Andrew Cuomo made the games legal in the state. The sources added that DraftKings and FanDuel are "so short of cash" that they have asked Schneiderman’s office if they can "pay the final settlement in installments, and they have conceded that they are having difficulty meeting their day-to-day obligations." Within the past three weeks, the N.Y.-based FanDuel has "laid off more than 60 people, and both companies have acknowledged that they are months behind in their payments to vendors." New York was the "eighth state to declare daily fantasy sports legal, and the companies are facing expensive efforts to have their games legalized in the big markets of Illinois and Texas" (N.Y. TIMES, 10/24).
