New Jersey's Appeal of Sports Betting Ban Heads to Supreme Court

Tue, Jul 4, 2017
by CapperTek

The Supreme Court agreed on Tuesday to hear an appeal from Gov. Chris Christie and the state of New Jersey to allow betting on professional and collegiate sports at the state’s casinos and racetracks.

The case, which the court will hear in the fall, will be a major test for the federal ban on sports betting as established by the Professional and Amateur Sports Protection Act, known as Paspa, which Congress passed in 1992 outlawing betting on amateur or professional athletes except in four states that already had operations.

New Jersey has been fighting either to overturn the federal ban or to find a way to work around it since 2011, when voters in the state approved a nonbinding resolution to allow sports betting. The effort has since been supported by Democratic and Republican legislators as a way to help shore up the sagging Atlantic City casinos and state racetracks.

But the effort was met with lawsuits from the N.C.A.A. and the four major sports leagues after Mr. Christie signed a law in 2014 to allow sports betting. The challenges wound their way through numerous lower courts, finally reaching the United States Court of Appeals for the Third Circuit in Philadelphia, which issued a ruling last year upholding the federal ban.

In a news conference in Trenton on Tuesday, Mr. Christie said he was “thrilled” by the decision of the court.

“The fact that the Supreme Court granted cert. in this case is a very good sign for sports betting having a future in New Jersey,” he said. “I’m encouraged by it. We’re not declaring victory, but at least we’re in the game, and that’s what we want to be.”

The decision by the Supreme Court to hear the case comes as a bit of a surprise after Jeffrey B. Wall, the acting solicitor general of the United States, asked the court in May not to hear the case.

Numerous states, including Pennsylvania, New York and California, have recently pushed bills to legalize sports betting. Sports betting podcasts like “Against All Odds” regularly crack the top sports charts on iTunes. Daily fantasy sports sites like DraftKings and FanDuel, which offer a very specific type of sports wagering, remain quite popular.

At stake is a significant amount of money. In Nevada, where sports betting is legal, it is now an industry of nearly $5 billion a year. Industry and law enforcement officials estimate that more than $150 billion is placed annually with illegal bookmakers and with offshore accounts.

With that much at stake, the American Gaming Association announced the creation of a coalition this month encompassing attorneys general, the police, policy makers and others to advocate a repeal of the federal ban.

“We are pleased the Supreme Court appears to have responded favorably to our arguments as to why they should hear this important case,” said Geoff Freeman, the president and chief executive of the gaming association. “And we are hopeful their engagement will provide further encouragement for Congress to take the steps necessary to create a regulated sports betting marketplace in the United States.”

In a recent meeting with reporters for The New York Times, Mr. Freeman said his organization had detected a new willingness among the sports leagues to make sports betting legal. Adam Silver, the commissioner of the N.B.A., has been forthright in calling for legal betting and the openness that accompanies it. Rob Manfred, the commissioner of Major League Baseball, has acknowledged that a sports betting market would continue to fuel fan interest in baseball.

The N.F.L., long an opponent of the bill, has signaled a softening of that stance in recent months with the commissioner, Roger Goodell, saying the league’s thinking on sports gambling was “evolving,” a shift underscored in March when team owners approved the move of the Oakland Raiders to Las Vegas.

Mr. Freeman, however, acknowledged that the N.C.A.A. remained the most concerted opponent to legalized sports gambling, noting that collegiate athletes are unpaid amateurs. He said one possible solution would be to prohibit betting on college football and basketball.

The N.C.A.A. did not immediately comment on the decision by the Supreme Court to hear the case.

While the court has offered no indication of how it might rule or why it was moving forward with the case, some industry advocates viewed the decision as a sign that the federal ban might be nearing its end.

“Paspa’s days may be numbered,” said Daniel Wallach, a sports and gambling lawyer from Florida, who has tracked the case closely. "The court can overturn federal statute and provide a free and clear pathway for Congress to take this up. It’s the perfect time for the leagues, casino industry and Congress to come together, and I think it potentially opens sports betting up nationally by the 2018 N.F.L. season.”