• by Wendy Davis  @wendyndavis, December 11, 2015

Daily fantasy sports sites FanDuel and DraftKings got a reprieve late Friday, when a New York appellate judge stayed an order directing the companies to immediately stop operating in the state.

"We will remain fully operational in New York," DraftKings attorney David Boies said in a statement. He added that the company is "encouraged" by its recent conversations with state lawmakers.

Earlier on Friday, Manhattan Supreme Court Judge Manuel Mendez ordered both companies to immediately shut down in New York. Mendez said in the ruling that New York's law against gambling is broad enough to cover daily fantasy sports.

Mendez accepted arguments by New York Attorney General Eric Schneiderman, who alleged in a lawsuit filed late last month that FanDuel and DraftKings violate state laws against sports betting and unfair advertising. He alleged that both companies -- which have spent around $100 million on ads this year alone -- dupe consumers with ads that offer "promises of easy riches for a lucky few sports fans."

Late last month, FanDuel stopped allowing New York residents to participate in the site's daily fantasy sports games, but DraftKings has continued to operate in the state

The companies unsuccessfully argued to Mendez that daily fantasy sports are games of skill, not chance. New York has long prohibited betting on games of "chance," including sporting events (except for horseracing), but allows gambling on games of skill.

Mendez drew on the gambling law's definition of "contest of chance," which says that the outcome turns "in a material degree" on chance, even if skill plays a role.