Fantasy sports site makes first lobbying hire as scrutiny grows

Daily fantasy sports website FanDuel started working with a Washington lobbyist days after a Democrat on a congressional committee called for hearings into the website’s controversial business model, records show.

James D. Barnette, a partner at law firm Steptoe & Johnson, and public policy staffer Lisa Mortier registered to lobby for the site this month. The firm is FanDuel’s first outside lobbying hire.

{mosads}The pair’s registration form says that they have been working for the website since September 17, 2015. That was just three days after Rep. Frank Pallone (D-N.J.), the ranking member of the House Energy and Commerce Committee, called for hearings into the daily fantasy sports industry and its relationship with professional sports leagues.

Critics like Pallone contend that the services, which allow users to win money based on the performance of a virtual team in a single day’s sports contests as opposed to over the course of a season, constitute gambling and should be subject to tighter regulations.

Barnette is a former aide to the committee and served as general counsel under its current chairman, Rep. Fred Upton (R-Mich.). Upton said in September that daily fantasy sports were “an issue that we ought to take a look at,” but that a hearing was unlikely to take place anytime soon.

Washington’s scrutiny of the daily fantasy sports industry has increased since Pallone’s call for a hearing in September.

It was revealed this month that an employee of DraftKings who had access to game data won $350,000 in a contest on FanDuel. The sites say he didn’t use the data to improve his chances on FanDuel, but the ensuing scandal led both services to permanently ban their employees from playing with their competitors. It also triggered a new round of questions from policymakers about the industry.

Pallone and Sen. Bob Menendez (D-N.J.) have both called for a Federal Trade Commission investigation into the websites in light of the allegations.

“These reports raise serious questions about the integrity of these online fantasy sports websites, and it raises the question of whether there are sufficient consumer and competition safeguards to protect the integrity of these online games,” they wrote to FTC Chairwoman Edith Ramirez.

The House Judiciary Committee is also looking into the two websites.

DraftKings has yet to make any lobbying hires in Washington, according to disclosure records. The Fantasy Sports Trade Association, which represents the industry, has worked with outside lobbying firms in the past.

The websites are the two biggest players in a growing industry whose ads are a constant presence during the commercial breaks of major sporting events. Both are valued at more than a billion dollars and have attracted investments from professional teams and broadcasters.