[toc]New Jersey’s long-standing attempt to find a backdoor route around the federal law prohibiting sports betting anywhere but Nevada, Deleware, Oregon, and Montana encountered another hurdle. Acting US Solicitor General Jeff Wall recommended to the US Supreme Court (SCOTUS) not to hear the latest appeal on the subject.
The full text of the Solicitor General’s “friend of the court” brief is here.
Perhaps not surprisingly, the US Solicitor General has determined that the federal law does not break the Tenth Amendment.
However, SCOTUS is not bound by the Solicitor General’s opinion. This means it can still decide to hear the case, if it believes a serious constitutional issue is in dispute.
Courts back the sports leagues, not sports betting
The 2014 law attempted to get around the provisions of PASPA by using a partial exemption from the law. It still forbid certain types of sports wagers. Excluded wagers include wagering on competitions held in New Jersey or in which a New Jersey team takes part.
It immediately met with opposition from the major sporting leagues. They traditionally lobby against sports betting on the grounds that it adds an integrity risk to sporting competitions. Unsurprisingly, The National Collegiate Athletic Association (NCAA) and the major sports leagues appealed the NJ law.
The leagues argued that attempting to exploit the language of PASPA in order to avoid its provisions was illegal. Additionally, the actual effect of the new law was to “license” and “authorize” gambling on sports—something expressly forbidden by PASPA.
The New Jersey law has been deemed to contravene PASPA in several hearings, including one en banc court. During that ruling, 12 judges ruled by 9 to 3 that the sporting organizations’ complaints are valid.
SG thinks NJ does not have much of a case
While reviewing the findings of the lower courts, the Solicitor General agreed with those which oppose New Jersey’s appeal. Moreover, he found little to support the contention that there is any breach of the Tenth Amendment.
However, the Solicitor General does quote elements of those judgments which could support a different attempt to allow sports betting:
“The en banc court thus emphasized that its holding that the ‘specific partial repeal which New Jersey chose to pursue in its 2014 Law is not valid under PASPA does not preclude the possibility that other options may pass muster.’”
As far as violating the Tenth Amendment goes, the Solicitor General concludes that:
“Section 3702(1) [of PASPA] does not violate the Tenth Amendment because it neither compels States to regulate according to federal standards nor requires state officials to administer federal law. Instead, Section 3702(1) prohibits States from operating sports-gambling schemes themselves or affirmatively licensing or authorizing private parties to do so.”
And, in an apparently paradoxical note, the SG adds that PASPA “…does not obligate States to enact any law or to implement or administer any federal regulatory requirement.”
This is in response to the legal point that the federal government cannot “commandeer” states in matters such as sports betting.
In other words, PASPA is legal because it doesn’t force states to do anything or to spend any money enforcing the federal law.
“PASPA does not require or coerce the states to lift a finger—they are not required to pass laws, to take title to anything, to conduct background checks, to expend any funds, or to in any way enforce federal law.”
Solicitor General wants to have his cake and eat it
The Solicitor General made one extremely revealing point about the legitimacy of the en banc court ruling:
“Focusing on the substance of the law rather than its form, the court concluded that the 2014 Act ‘is an authorization.’”
Apparently the Solicitor General’s office doesn’t see the inconsistency between focusing on the substance of the law when deciding that the New Jersey law contravenes PASPA, while relying on the form of the law when determining whether PASPA is in breach of the Tenth Amendment.
The Solicitor General clearly supports the en banc court’s finding that “PASPA allows states to ‘choose among many different potential policies on sports wagering that do not include licensing or affirmative authorization by the State.’”
Curiously, the Solicitor General doesn’t explain how a state can adopt a permissive policy on sports wagering without a licensing scheme or affirmative authorization.
New Jersey must now hope that SCOTUS will see that there is a substantial issue that requires resolution and add the case to its docket. An announcement of the final decision is expected in June.
As gaming lawyer Dan Wallach Tweeted, New Jersey will need to get lucky:
NJ sports betting may be on life support (for now), but it has already achieved 2 Hail Mary's: en banc rehearing + CVSG. Can it pull a 3rd?
— Daniel Wallach (@WALLACHLEGAL) May 24, 2017