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In this Sept. 9, 2015 photo, Len Don Diego, marketing manager for content at DraftKings, a daily fantasy sports company, works at his station at the company's offices in Boston. DraftKings, as well as fellow top sports fantasy site FanDuel, were named as defendants in a lawsuit in federal court in Portland. (The Associated Press)

A class-action suit has been filed in federal court in Portland against two daily fantasy sports sites, FanDuel and DraftKings, alleging both businesses are operating illegal online sports betting.

Brandon Peck, a resident of Polk County, brought the suit on behalf of himself and more than 100 other Oregon players who lost money in the past three years while placing wagers online through the two sites, Draftkings.com and FanDuel.com.

The suit, filed Monday, asks the court to halt the companies' operations and have each business pay players back double the amount they've "wrongfully lost,'' seeking more than $5 million.

The suit is the latest class-action suit filed against the daily fantasy sports websites. More than 30 have been filed in more than 10 states. They allege that the players were duped into participating in illegal gambling operations that gave an unfair advantage to their own employees who also participated in the daily competitions.

Like fantasy sports games, where groups of people play against one another, assembling hypothetical teams and scoring points based on how players did in actual games, the two companies have set up online daily and weekly games. Players pay an entry fee to a website -- from 25 cents to several thousands of dollars -- to play dozens if not hundreds of opponents, with prize pools that can pay $2 million to the winner. Players whose teams score the most points -- based on the actual statistics of those players -- win the most money.

In the federal suit filed in U.S. District Court in Portland, attorney Thomas D'Amore argues that both sites violate Oregon law, which expressly prohibits "gambling" and "betting.''

He cites actions taken by other states challenging the fantasy sports league sites. For example, he noted that the general counsel for the Georgia State Lottery wrote to the defendants, arguing that the state's constitution bans gambling except for state lottery activities. He included an October order by the Nevada Gaming Control Board ordering both companies out of that state unless they obtained a gambling license.

A month later, New York's Attorney General sent the companies an order to cease operations, also finding that their businesses amounted to illegal gambling under New York law.

New York's attorney general began an investigation last fall after revelations that DraftKings and FanDuel allowed their employees , many who had information not available to other players, to play at each other's sites and win large amounts of money.

The companies have argued that fantasy sports aren't gambling but a game of skill, not chance, which exempts them from a 2006 federal law prohibiting online gambling. On its website, FanDuel.com, the company contends that fantasy sports received a specific exemption from the 2006 Unlawful Internet Gambling Enforcement Act.

Peck's lawyer argues the games require very little to no skill, that the outcomes are determined largely by chance and "return casino-type 'odds.' ''

Many of the companies' customers "lack even a rudimentary understanding of sports, or getting strategy in general'' and yet place wagers on the two websites and "lose and win based on pure luck,'' Peck's lawyers wrote.

Though DraftKings is based in Boston and FanDuel is based in New York, the lawsuit argues that a federal judge in Oregon has jurisdiction because the companies conduct business in Oregon, seek players from Oregon and have harmed more than 100 players in this state.

-- Maxine Bernstein

mbernstein@oregonian.com

503-221-8212

@maxoregonian