Can Barstool And Penn Coexist In A Regulated Business?

Beneath Dave Portnoy’s management, Barstool Sports activities has been the topic of many controversies. Not a lot has modified since Penn Leisure absolutely acquired the sports activities media firm in February.

Previous to Penn’s Q1 earnings name, Penn made the choice to fireside a well-liked Barstool worker, Ben Mintz, who rapped music lyrics that contained a racial slur.

Now that Barstool is beneath the Penn umbrella, Portnoy and firm CEO Erika Nardini have misplaced the facility to make some key choices inside the model. As a result of Barstool is now in a regulated trade, choices are way more lower and dry.

Barstool Sportsbook, which operates inside the PA on-line sports activities betting market, has made it troublesome for Penn to exist within the regulated trade.

Can the partnership stay intact?

What occurred with Barstool worker Ben Mintz?

Ben Mintz is a reasonably well-known Barstool character. He hosts podcasts for the corporate and whereas on his livestream, Mintz rapped music lyrics that contained a racial slur.

Mintz was subsequently fired from Barstool, in a transfer that seemingly got here from somebody increased than Portnoy and Nardini. Shedding that sort of energy is just not one thing the corporate is used to. Nevertheless, they gave that up when permitting Penn to purchase them out.

Throughout the earnings name, Penn CEO Jay Snowden briefly addressed the incident. He stated:

“It’s one thing that occurred inside the corporate that we handled. We felt like we handled it appropriately.”

In a Twitter rant minutes earlier than the earnings name, Portnoy overtly disagreed with the choice to fireside Mintz.

“Not in my wildest goals did I believe I’d be sitting right here saying we needed to fireplace Ben Mintz,” Portnoy stated on Twitter. “Penn felt in another way, and I’m surprised by it. I’ve been combating tooth and nail, as has Erika, as has Dan [Katz], to maintain Ben and say that is the mistaken determination.”

Nardini boasted on the earnings name that Barstool is a “firm that’s genuine, it’s an organization that’s unapologetic.” As Barstool continues to be as “unapologetic” because it desires, it clearly doesn’t have the identical decision-making energy it as soon as had.

Regulated sports activities betting trade impacting Barstool

It’s clear that Portnoy and the remainder of the Barstool crew wouldn’t have fired Mintz.

Although Snowden didn’t focus on the scenario a lot on the earnings name, Portnoy supplied some intel on what Snowden instructed him.

“Penn is satisfied there’s a professional likelihood a lot of the states would pull their licenses due to this,” Portnoy stated. “Penn is a multi-billion greenback firm and with out their licenses, they’re a zero greenback firm.”

Portnoy added:

“I instructed them, if this was me and the state needed to tug a license due to this I’d put it on blast 100-fold. And I’d be like ‘that is what we’re coping with?’ And our crowd would rally and we’d change into stronger. [Snowden] stated ‘you understand what that’ll do? They’ll simply pull the license in every single place probably.’”

Penn operates the Barstool Sportsbook in Pennsylvania. PlayPennsylvania requested the Pennsylvania Gaming Management Board (PGCB) whether or not the connection between Barstool and Penn threatens accountable playing and the regulated trade. Doug Harbach, PGCB Director of Communications, answered with this assertion:

“That may take some dialogue internally, however since Mintz… like Portnoy… should not licensed by us… unsure there’s relevance to a PN license.”

By that assertion, the PGCB is treating Barstool’s relationship to Penn as a separate entity, since Penn really owns the license. Portnoy’s identify is not included within the license software that was permitted in Pennsylvania.

Different Barstool controversies inside the regulated gaming trade

This isn’t the primary time Barstool has blurred the traces within the regulated gaming trade.

Throughout March Insanity, Dan Katz began destroying a desk with a baseball bat after shedding a wager.

The violence proven within the tweet leads viewers to consider that sort of conduct is appropriate. Keith Whyte, Government Director of Nationwide Council of Drawback Playing (NCPG), instructed PlayPennsylvania in March:

“Implicitly selling or normalizing excessive anger after shedding a wager is irresponsible messaging.”

Again in February, Barstool Sportsbook additionally accepted a $250,000 high quality for selling its sportsbook app throughout an occasion aimed towards school college students. The occasion occurred close to the College of Toledo in November.

Barstool has toed the accountable playing, and even moral traces, since Portnoy based the corporate again in 2003. They’ve now change into Penn Leisure’s conundrum.

Penn inventory dips following controversy

Following the discharge of its earnings report and the Barstool controversy, the Penn inventory closed at $30 on Could 3. On Could 4, the value dropped to $28.50 when the market opened and dipped to $26.20 by the top of the day. The worth sits at $26.54 as of Friday afternoon.

Portnoy tweeted a screenshot of the inventory and stated “That’s Mintzy,” regarding the worth dropping.