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Department of the Interior Calls Arguments For Rehearing ‘Strawmen’ In Court Response

Written By Matthew Kredell on August 31, 2023 - Last Updated on September 1, 2023
DOI responds to West Flagler appeal of Florida compact (1)

The Department of the Interior on Thursday told the DC Circuit US Court of Appeals it should deny rehearing a case on the validity of the gaming compact between the Seminole Tribe and State of Florida.

The DOI was responding to West Flagler’s petition for the Court to rehear en banc, or in front of all 11 of its judges, its legal challenge of the compact’s inclusion of statewide online sports betting on tribal lands.

DC Circuit judges will now determine if a rehearing is needed. The speed of their decision could impact how soon the Seminoles relaunch online sports betting in Florida with the NFL season right around the corner.

Details of response from Interior

West Flagler, a commercial gaming operator in Florida, filed the lawsuit in 2021 against US Secretary of the Interior Deb Haaland for allowing the compact to go through with gaming off tribal lands. The Indian Gaming Regulatory Act (IGRA) was put in place to regulate gaming on Indian lands.

Federal District Court Judge Dabney L. Friedrich ruled in November 2021 that the compact violated IGRA. But the DC Circuit Court overturned that ruling June 30, saying the District Court erred in invalidating the Seminole compact.

In requesting a rehearing, West Flagler argued that the DC Circuit opinion raised questions of exceptional importance regarding the scope of IGRA and conflicted with precedents in other circuits.

The DC Circuit asked the “appellant” to respond to the filing. It was previously unclear whether the Court was requesting a response from Interior or the Seminoles. The order for a response placed “appellant” under the Tribe. However, the response came from Assistant Attorney General Todd Kim and his staff.

In their response, the DOI explained:

“West Flagler responded by suing the Secretary of the Interior — who has no control over what gaming Florida permits on non-Indian land within its borders — because the Secretary did not disapprove a Tribal-State gaming compact addressing, among other topics, how the Tribe will treat state-sanctioned wagers placed from non-Indian land once received by the Tribe via servers located on Indian land.”

The DOI countered that West Flagler’s argument against state-sanctioned wagers is more appropriate for state courts.

“West Flagler’s arguments for rehearing are strawmen, premised on its erroneous assertion that, by referencing the state-sanctioned wagers, the Compact — and the Secretary’s approval thereof — purport to unilaterally legalize the placement of those wagers and the State regime for regulating them. But, as West Flagler acknowledges, the panel held in no uncertain terms that the Compact does not do that.”

Defining the limitations of IGRA

The DC Circuit ruling is significant for the prospects of tribal online gaming throughout the country. IGRA has long regulated gaming on tribal lands agreed to through compacts with the state and approved federally.

Emergence of digital gambling tests the boundaries of IGRA as tribes look to extend their reach online in order to modernize with the changing landscape of gaming.

The Seminole compact was the first tribal-state agreement submitted to the Department of the Interior to include statewide online sports betting. The DOI allowed the compact to go through without taking action. However, Bryan Newland from the Bureau of Indian Affairs within the DOI issued a statement explaining why they were allowing the compact.

Essentially, the DOI said that the Secretary does not have the power to authorize a state regime for gaming outside Indian land, but that IGRA does not limit a compact’s contents to gaming on Indian land. It could include other agreements between the tribe and state, such as gaming off Indian lands.

In the rehearing response, the DOI again explained why Department officials believe a compact under IGRA can contain gaming off tribal lands:

“IGRA places no conditions or restrictions on gaming on non-Indian lands. The statute thus leaves undisturbed a state’s ‘capacious’ authority to determine whether and under what conditions to permit gaming on lands within its jurisdiction. Nothing in IGRA compels a state to seek the Secretary’s approval before permitting gaming on non-Indian land, or before enacting a regulatory regime governing such gaming.”

Rehearing seems highly unlikely

The rehearing request seems like a procedural move with little hope of success. The DC Circuit rarely grants rehearings — it last did in 2021 — and it’s more likely in a split decision. A 3-0 ruling means six of the remaining eight judges would need to approve the request.

Florida-based sports and gaming attorney Daniel Wallach told PlayUSA that he was surprised the court even asked for a response. He expected the DC Circuit to quickly reject the request without needing to hear from other parties. And that is despite Wallach believing in the merits of a rehearing.

The court previously noted that it would not accept a response from West Flagler, meaning there shouldn’t be any more steps before a decision.

Florida online sports betting relaunch at stake

If the DC Circuit rejects the rehearing request, its mandate reinstating the Seminole compact would go into effect seven days later. So a quick decision from the court could still allow the Hard Rock Bet app to launch for the first week of the NFL season.

However, the holiday weekend seems to make a quick decision less likely. There’s really no telling if the court will act tomorrow or weeks later.

West Flagler also has options to stay the mandate further. West Flagler could ask the DC Circuit to hold off on issuing the mandate while it appeals to the US Supreme Court.

The Seminoles can also test the court and relaunch the Florida sports betting app without the mandate. After all, the tribe continued offering online sports betting for 34 days after the district judge struck down the compact in 2021.

Wallach said he thinks the Seminoles would wait the seven days out of respect to the court’s order, which means the next step by the DC Circuit could determine when Floridians have a legal option to make NFL wagers.

Photo by PlayUSA
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Matthew Kredell

Matthew Kredell serves as senior lead writer of legislative affairs involving online gambling at PlayUSA. He began covering efforts to legalize and regulate online gambling in 2007 after federal passage of the Unlawful Internet Gambling Enforcement Act disrupted his hobby of playing small-stakes online poker. He has since interviewed more than 300 lawmakers around the country and written extensively about online gambling legislation. He has led coverage of bills to legalize online gambling in most states. A lifelong Angeleno and USC journalism alum, Matthew started his career working as a sportswriter for a decade at the Los Angeles Daily News. He has written on a variety of topics for Playboy Magazine, Men’s Journal, Los Angeles magazine, LA Weekly and ESPN.com.

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