It was an underdog from the start but New Jersey government officials managed to defy heavy odds against them and get its sportsbetting case to be heard by the Supreme Court this year. It is the culmination of a three-year battle the state has waged against the federal government and major sports organizations.

Chris Christie
Governor Chris Christie has been a supporter of legalizing gambling in his state and the Supreme Court will rule on the issue sometime in early 2018. (Image: Associated Press)

On Dec. 4 the nine justices heard oral arguments from lawyers representing the Garden State as to why they should overturn the 1992 law passed by Congress. The Professional and Amateur Sports Protection Act (PASPA) was enacted to effectively ban sportsbetting in the US except for four states: Nevada, Delaware, Oregon and Montana. They are expected make a ruling in the Spring of 2018.

New Jersey’s efforts to repeal PASPA go back as far as 2009, when State Senator Raymond Lesniak (D-20th District) filed a lawsuit that year that was dismissed by a US district judge in 2011.

Ted Olson, the lawyer representing New Jersey, argued the law violated the Constitution’s protection of state’s right and he seemed to win over a majority of the justices. If the comments by the court are any indication, they might be ruling in the favor of New Jersey.

Justice Anthony Kennedy was one who appeared swayed, saying: “This blurs political accountability. The citizens of the State of New Jersey are bound to obey a law that the state doesn’t want but the federal government compels the state to have.”

Early Setbacks

Proponents of wagering have fought back on PASPA and two years later new Jersey voters approved a referendum legalizing the activity that Republican Governor Chris Christie signed into law the following year. That was quickly followed by legal action filed by the NCAA, NFL, MLB, NBA and NHL, who got a judge in the US District Court for the District of New Jersey to find in their favor and uphold PASPA.

Lawyers for Christie and the state appealed in 2013 to the Third Circuit Court of Appeals and again they were denied by a 2-1 vote. In 2015 they appealed to the same judicial body but requested an en banc decision, which required all of the justices to hear the case. They agreed and in February 2016 they again ruled for the plaintiffs by a 9-3 margin.

The last legal tactic they had was to plead to the Supreme Court, which they did in November 2016. The judicial body hears a small fraction of the cases presented and when acting US Solicitor General Jeffrey Wall in April recommended to the high court that they should pass on the state’s request it looked like their chances were doomed.

Surprisingly the justices agreed in June to review it and set the December 4th date for oral arguments, with written briefs due three months before. They will decide on whether PASPA should be repealed sometime in early 2018.

Consequences of Outcome

Meanwhile the public and the commissioner of some of the sports leagues have softened their stance toward legalized wagering. A poll conducted in September by the Washington Post and the University of Massachusetts Lowell showed 55 percent approved of the pursuit, while 35 percent did not.

Former NBA Commissioner David Stern changed his opinion on the subject and said that PASPA should be rescinded. The new commissioner Adam Silver said in July he expected it to be legalized in the next few years. The NHL has a hockey team in Las Vegas and the NFL’s Oakland Raiders will be relocating there in 2020. Both league executives talked about how they did not expect any issues with Sin City.

GamblingCompliance, a leading provider of business intelligence to the global gambling industry, issued a report in October about the economic impact if PASPA was not in effect. They project up to 20 states would house sports wagering venues that would generate between $2-$5.8 billion in gross gaming revenue within five to seven years.

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