The FanDuel Inc. app is arranged for a photograph on an Apple Inc. iPhone in Washington, D.C., U.S., on Sunday, Oct. 4, 2015. Fantasy sports companies DraftKings Inc. and FanDuel Inc. raised a total of $575 million in July from investors including KKR & Co., 21st Century Fox Inc. and Major League Baseball to attract players to games that pay out millions of dollars in cash prizes in daily contests. Photographer: Andrew Harrer/Bloomberg via Getty Images

In the wake of the State of New York going after daily fantasy sites and the failure of DraftKings and FanDuel to stop a temporary restraining order preventing them from doing business in the state, one company has decided to suspend its operation there. FanDuel has announced that it will not entries from New York for the time being.

The company announced this week that it’s delaying payments to winners which signals some trouble. In its declaration on Tuesday, FanDuel says it hopes that the New York suspension will be temporary. But it did tell customers that it won’t be taking paid entries for now:

– If you entered into a FanDuel contest before 2:30pm EST on Tuesday, the contest will run, uninterrupted.

– As of Tuesday’s cut off, users in New York will be restricted from entering paid contests.

– As has been the case, all users in New York can and will absolutely be able to withdraw their money at anytime. However, we believe we will have an update from the Court in 10 days and hope to be able to offer paid contests to New Yorkers again. Users funds are and will remain secure.

We maintain, unequivocally, that FanDuel has always complied with state and federal law. We look forward to vindicating our position in court next week.

DraftKings and FanDuel will be heading back to court next Wednesday as the New York Supreme Court will hold an emergency hearing to determine the legality of daily fantasy. Both companies contend that they’re legal and not gambling as New York Attorney General Eric Schneiderman has ruled.

In the meantime, those who played daily fantasy in New York won’t be able to play for at least a week. And as other challenges arise from other states and the Feds, daily fantasy continues to fall under the microscope not just from a legal perspective, but from late night shows. So far, DraftKings and FanDuel have been taking hits. The emergency hearing next week may determine whether daily fantasy will remain afloat or sink under the legal pressure.

[Above the Law]

About Ken Fang

Ken has been covering the sports media in earnest at his own site, Fang's Bites since May 2007 and at Awful Announcing since March 2013.

He provides a unique perspective having been an award-winning radio news reporter in Providence and having worked in local television.

Fang celebrates the four Boston Red Sox World Championships in the 21st Century, but continues to be a long-suffering Cleveland Browns fan.