Category Archives: Court Case/Decision

Supreme Court Could Rule in Favor of Sports Betting Expansion Soon, MLB & NBA Seek to Impose a Controversial Integrity Fee

Casino Watch Focus has reported over the years on the numerous efforts by New Jersey to legalize sports betting in their State. As is stands. Las Vegas is the only place where sports betting in allowed and the Supreme Court has heard arguments about the appropriateness of the PASPA, the law which makes it illegal outside of that specific jurisdiction. Experts believe the ruling could come as early as Monday, April 2nd, so states are getting ready. The Washington Post reports:

Some time before July — perhaps as early as Tuesday — the Supreme Court is expected to make a ruling that could drastically alter sports gambling in the United States, possibly striking down the 25-year-old federal law that largely prohibits sports bets outside of Nevada or maybe allowing individual states to decide for themselves whether fans should be permitted to wager on games.

While the Supreme Court could opt to maintain the status quo, many sports gambling analysts and court-watchers anticipate a ruling that lays out some sort of path to legal sports wagering. At oral arguments in December, a majority of justices seemed receptive to New Jersey’s argument. At least 18 state legislatures have some form of legislation in the works in anticipation of the Supreme Court giving them a path to legalized sports betting.

The States aren’t the only ones preparing for such a Supreme Court decision. Whereas the NHL and NFL are continuing their position of opposing sports gambling, the NBA and MLB are actively lobbying state legislatures to craft gambling legislation that they believe will be integral to the leagues. Bloomberg explains:

Now, on the eve of a Supreme Court decision that could reshape gambling in America the leagues have come around. Professional baseball and basketball have gone further: They also want a cut of the profits, drawing a new battle line with the casinos and sparking a state-by-state lobbying war. The National Basketball Association and Major League Baseball are asking legislators to require casinos to pay the leagues 1 percent of all wagers placed on their sports. Casinos and sports book operators, unsurprisingly, are vehemently opposed.

The fee is by far the most controversial entry on the leagues’ wish list, though there are others: The leagues want states to require bookmakers to use official data streams, share consumer information and allow the leagues final approval of what types of wagers are allowed on their games.

The leagues justify the fee as part royalty, owed to the league for rights to profit off its games; and part insurance policy, to offset the risk to the league that its games will be corrupted and the money it will spend to make sure they aren’t.

“Sports betting is built on our games,” NBA General Counsel Dan Spillane told a hearing of Connecticut legislators on March 1. “If something goes wrong, if there’s a scandal, something that tarnishes the image of the game, that’s going to be a cost borne by the sports leagues, and less of a cost borne by the operators that offer sports bets.”

A representative from William Hill Plc, one of the world’s biggest gambling companies, made the bookmaker’s case. Las Vegas casinos typically keep about 5 percent of the bets they take, he said, which means the NBA’s proposed 1 percent cut is really a 20 percent cut of revenue.

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Florida Ends Session with No Gambling Bills Passed – Seminole Tribe Provided Assurances to Continue the Revenue Sharing Compact in the Interim

Casino Watch Focus has reported on the ongoing gambling expansion issues in Florida. Many issues were on the table this legislative session including a new gambling compact between the State and the Seminole Tribe, a greyhound racing ban, specific regulations on types of card games to be allowed, and the location and expiation of new slot machines in the states. The hope was to address these issues this legislative session, as it seems clear that a new amendment will pass a vote of the people to require all future gambling legislation to be approved by the voters. Most recently though, Casino Watch Focus reported that those goals were unlikely to be achieved as the focus of the Florida legislators would be shifting to focus on gun control legislation that was prompted after the Parkland school shooting. After those efforts were complete, gambling discussions were given some very last minute life, but as reported by The Palm Beach Post, those efforts have come to a close with no new gambling bills being passed:

Republican legislative leaders had resurrected the issue in the waning days of the session as they tried to strike a deal between the gambling-leery House and the Senate, which was willing to expand slot machines to counties where voters have approved the lucrative machines.

But after a day of horse-trading, House Speaker Richard Corcoran and Senate President Joe Negron declared the issue off the table. “Despite the good faith efforts of both the House and Senate, a gaming bill will not pass the Legislature this session,” the leaders said in a statement Friday evening. “Gaming remains one of the most difficult issues we face as a Legislature. We are pleased with the progress made over the last week and know that our colleagues will continue to work on this important issue.”

Lawmakers were anxious to address the perennially elusive issue due to a constitutional amendment on the November ballot that would give voters control of future gambling decisions, something now largely left up to the Legislature.

“We spent so much time, and rightfully so, on the school-safety legislation, and we found ourselves on a Friday, with a Sunday deadline if we had extended, and the tribe’s not up here,” Galvano said, referring to school-safety legislation stemming from the Feb. 14 mass shooting at a Broward County high school.

One of the more pressing issues at hand, was the formation of a new gambling compact between the Florida and the Seminole Tribe. The legal issues at hand have stemmed from the exclusivity aspects of certain card games in exchange for income to the State. The Palm Beach Post continues:

Also, legislators wanted to ensure a steady stream of income from the Seminole Tribe of Florida. The money could be in peril after a federal court ruling about controversial “designated player” games at pari-mutuel cardrooms throughout the state. Striking a new deal, called a compact, with the Seminoles, which would be part of any gambling legislation, has proved elusive for legislators.

One of the critical provisions of a 2010 deal between the state and tribe, giving the tribe “exclusivity” over banked card games, such as blackjack, expired in 2015. That spawned a protracted legal battle and previously futile attempts by lawmakers to seal a new agreement. The tribe pays more than $300 million a year under the banked-card games portion of the 2010 agreement.

But the legal battle focused heavily on what are known as “designated player games,” which are played at pari-mutuel facilities. After a federal judge sided with the tribe in a dispute over whether the lucrative designated-player games breached the Seminoles’ exclusivity over offering banked card games, the tribe agreed to continue making payments to the state, and gambling regulators promised to “aggressively enforce” the manner in which cardrooms conduct the designated player games.

While the tribe agreed to temporarily continue paying the state, some lawmakers are eager for the financial certainty a new compact would provide. But Galvano said he has spoken with a representative of the tribe, who assured him that the Seminoles intend to maintain the revenue-sharing agreement with the state. 

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UPDATE: Despite Florida Supreme Court Ruling, Gadsden Looking to Authorize Slots in North Florida Again

Casino Watch Focus has reported on the ongoing saga of a north Florida county attempting to legalize slot machines. Florida law very clearly outlines the jurisdictions of where slot machines and other gambling are legal, and Gadsden county is not one. The issue of voter approved slot machines in not designated areas reached the Florida Supreme Court and they unanimously agreed Florida law prohibited such gambling venues. However, it appears a new bill has been filed to again allow Gadsden County to hold a referendum on authorizing slot machine gambling at the local race track. Florida Politics breaks down the attempted angle they are taking:

A unanimous Florida Supreme Court last year ruled against the track and facilities in seven other counties that previously passed local referendums allowing slots, saying “nothing in (state gambling law) grants any authority to regulate slot machine gaming to any county.”

The holding was limited to non-charter counties, however. Gadsden does not have a charter but did pass a slots referendum in 2012. Tuesday’s bill responds to the court’s ruling that “the Legislature did not specifically authorize” that referendum.

It would OK the following ballot question: “Shall slot machine gaming be authorized at the pari-mutuel quarter horse racing facility in the City of Gretna?”

The issue was quickly addressed by Executive Direct of Florida group No Casinos, and Paul Seago was very to the point in his opposition:

“First, we think it violates the Florida Constitution, which prohibits expansion of casino gambling without a statewide vote,” he said. “Second, it sets up a violation of the compact between the state and the Seminole Tribe, jeopardizing millions of dollars in revenue.”

The Seminole Tribe of Florida enjoys exclusive rights to offers slots outside of South Florida; breaking that exclusivity entitles the Tribe to reduce or stop paying a cut of its gambling revenue to the state.

“Third, any municipality that thinks casino gambling is a key to economic development need look no further than Atlantic City to see the associated crime and social ills that come with it,” Seago added. “For these reasons we will vigorously oppose HB 1111.”

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UPDATE: The Supreme Court Heard Oral Arguments in the New Jersey Sports Betting Case and Experts think the Court Might Side with Gambling Expansion

Casino Watch Focus has reported on the ongoing events surrounding legalized state sports gambling as it pertains to New Jersey. For years they have tried and failed to legalize sports betting in their state. The issue has finally made it to the Supreme Court and the sides have been fairly well documented, with New Jersey and gambling operators seeking legalized sports betting and the major sports organizations such as the NCAA, NFL, MLB, NBA and NHL and the Trump Administration’s Department of Justice backing existing Federal law which prohibits sports betting outside of Las Vegas. Oral arguments have now been heard and early statements by a majority of the justices seem to indicate they might side with New Jersey. Forbes reports:

Proponents of legalized sports betting had to be feeling confident after last Monday’s oral argument in/NCAA v. Christie/ — the so-called New Jersey sports betting case, in which leagues including the NFL, the NBA and Major League Baseball are seeking to prevent the state from permitting such gambling. The general consensus among those in attendance was that the Supreme Court appears poised to invalidate the Professional and Amateur Sports Protection Act (PASPA), the 1992 federal law that bans states from authorizing or licensing sports betting.

By my count, at least five justices — John Roberts, Anthony Kennedy, Neil Gorsuch, Samuel Alito and, surprisingly, Stephen Breyer (one of the court’s more liberal members) — indicated that they believed PASPA violates the 10th Amendment’s anti-commandeering principle, which forbids the federal government from commanding the states to implement federal laws or policies that would interfere with state sovereignty.

From the tenor of the oral argument, with only Justices Elena Kagan, Sonia Sotomayor and Ruth Bader Ginsburg appearing to credit the leagues’ argument that PASPA is a straightforward preemption law, one could easily envision a decisive victory for New Jersey. A 6-3 margin sounds about right — at least that’s my prediction.

Additional factors seem to indicate a shocking reversal from where the issue was just months ago, following 6 failed attempts by New Jersey. ROI provides the additional analysis:

“When you look at recent history on U.S. Supreme Court rulings, 83 percent show a reversal of the lower court opinion; and in the past five years, that figure is still over 70 percent,” Wallach said.

“So, all of the metrics show a change is afoot. What that change looks like, we’ll have to wait and see. It might not be whether New Jersey prevails on its partial repeal, but how sweeping of a decision in New Jersey’s favor it turns out to be.”

Court followers suggest the decision would come in spring or later. Just months ago, New Jersey and the gaming industry believed it had exhausted all efforts to win this case. But, to the surprise of many, on June 27 the Supreme Court decided it would take the case. “Look at where this case was just five months ago,” Wallach said. “It wasn’t even being mentioned. Now it’s going to the Supreme Court. New Jersey has lost six battles on this case in the lower courts. But this is the one that counts.

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The Trump Administration and 30 other Advocacy Groups Filed Supreme Court Briefs supporting the NFL and other’s Opposition to the New Jersey Sports Gambling Case

Casino Watch Focus has reported on the ongoing saga of events surrounding New Jersey’s attempt to legalize sports betting in their state. All attempts have resulted in failure and this latest attempt has managed to reach the Supreme Court. The issue at hand is the constitutionality of the Professional and Amateur Sports Protection Act (PASPA). The Federal government has long held sport betting to be illegal outside of a few jurisdictions. They passed PASPA and allowed existing jurisdictions like Las Vegas to continue to offer it. The rest of the states would not be allowed to legalize it. Years later, after New Jersey missed its window to seek sports betting, they have decided they and other states should be allowed to regulate it and that Federal Government interference is a violation of federalism. The NFL, along with the other pro sports leagues and the NCAA, have long opposed expansion of sports betting. Casino Watch Focus reported that they filed their own brief to the Supreme court outlining that the federal government cant command a state government into an action, an act known as impermissible commandeering, but they are fully allowed to the federal government to preempt state action to contravene federal policy. The Department of Justice has long held this same belief and now the Trump Administration has formally filed its own brief outlining PASPA supporting arguments. An online source reports: 

President Donald Trum has been feuding with the NFL in recent weeks over the national anthem controversy. But the Trump administration, via the *Solicitor General’s office*, is supporting the NFL in its ongoing case to stop *New Jersey* from offering sports betting. The Solicitor General says that SCOTUS should uphold the lower courts’ finding that New Jersey’s partial repeal of its sports betting ban did not go far enough to be legal under PASPA.

The leagues have argued that the New Jersey law essentially licenses casinos and horse racing tracks to conduct sports wagering. That puts the state in violation of PASPA, the SG argues. New Jersey argues that PASPA unconstitutionally commandeers it to keep its own laws on the books when it comes to not allowing sports betting. But the SG argues PASPA’s “preemption of state laws authorizing sports-gambling schemes does not violate the Tenth Amendment.”

In addition to the briefs filed by the major sports organizations, the NCAA, and the DOJ, 30 advocacy and political organization have combined to offer their own brief. The addressed the federalism issue head on, but also expanded on why the federal government has compelling interest is preempting gambling expansion on the state level, namely the social costs. An online source explains:

On Monday a broad coalition of organizations led by Stop Predatory Gambling filed an amicus brief (“friends of the court”) in the Supreme Court of the United States, supporting the NCAA, NFL and major professional sports in their opposition to New Jersey’s case seeking to bring sports betting into the state.

Stop Predatory Gambling And a Range of Political and Advocacy Groups Support PASPA In a Brief Focusing on Social Costs of Gambling. The 30 groups, which include the Public Health Advocacy Institute and Concerned Women for America, spend the majority of the 33-page brief discussing negative effects and social costs of gambling.

The groups are “united in their opposition to the exploitation of American communities through commercial gambling” the brief reads.

 Later in the brief, the groups highlight research papers discussing gambling addiction, personal bankruptcies and elevated divorce rates associated with problem gambling, as well as financial costs to states themselves (such as crime) in connection with increased gambling activity. The paper also points a 2015 study by Rachel A. Volberg et al. of the University of Massachusetts School of Public Health and Health Sciences, showing a higher prevalence of gambling problems among sports bettors as compared with other forms of gambling, such as instant lottery games and casino games.

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Unsurprisingly, Casino Lobby Joins New Jersey in Attempt to Sway Supreme Court in favor of Legalized Sports Betting

Casino Watch Focus has reported on the many attempts by New Jersey to legally allow sports betting in their state, despite federal law that makes it illegal. Every attempt made has resulted in the courts shutting down the illegal sports gambling. The case will finally be resolved one way or another later this year when the Supreme Court will examine the issue. The list of opponents of this expanded sports betting is long and includes all the major sports and collegiate organizations such as the NFL, MLB, NBA, NHL and the NCAA. Not surprisingly, the casino lobby is coming to the side of New Jersey and they have submitted a brief to the Supreme Court. The Washington Examiner reports: 

The American Gaming Association filed a brief on Tuesday supporting Republican New Jersey Gov. Chris Christie in his upcoming Supreme Court fight with top U.S. athletic leagues over sports betting. Christie’s team argues that federal law banning sports betting violates states protections under the 10th Amendment. More than two decades ago, New Jersey failed to take advantage of a window in federal law to run sports gambling, but then decided to do so on its own in 2011.

The National Collegiate Athletic Association challenged the New Jersey law, along with the NBA, NFL, NHL, and Major League Baseball. The Supreme Court has yet to set a date for oral arguments this term in the sports gambling case, which will be closely watched as its outcome could change sports gambling rules throughout the country.

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Florida goes after Pari-Mutuels as it Seeks to Enforce Designated-Player Card Games Ruling

Casino Watch Focus has reported on the ongoing and developing situation regarding designated player banked card games. This form of card game was offered for four years before its legality was challenged. Last year, however, the court determined the games to be illegal and a violation of the Seminole Compact which outlined exclusive card games at Seminole casinos. As recently reported by Casino Watch Focus that ruling is being challenged in appeals court and is set to be heard next month. In the mean time, swift enforcement has begun to stop these illegal card games. An online source explains:

Florida gambling chiefs have launched legal action against two pari-mutuel venues, the Sarasota Kennel Club and Pensacola Greyhound Racing, for their alleged failure to remove so-called “designated player games” from their premises.

Meanwhile, many of Florida’s other cardrooms and racetracks are bracing themselves for similar action, as the state moves to crack down on the controversial games.

This action is especially important given litigation was dropped by the Seminole’s in exchange for the state agreeing truly enforce the courts ruling. The online source continues:

The case had initially been brought by the State against the Seminoles for their refusal to stop offering banked games once their initial five-year compact expired in 2015. But the tribe countersued over the exclusivity violation, forcing the state into a humiliating retreat. In July, both parties agreed to an end to litigation and the state vowed it would take “aggressive enforcement action” against pari-mutuels that violated the ban on the games it had previously permitted.

Nick Iarossi, a lobbyist for Jacksonville Greyhound Racing, told Sunshine State News that the state’s actions this week show it intends to live up to its word. “They’re going to come in. They’re going to check tape. They’re going to watch games being played live. And if they see anything out of compliance being done, they’re going to issue administrative complaints and fines,” he said. “So everybody is double- and triple-checking to make sure they’re in compliance.” 

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