House of Cards™


Excerpt from Gambling and the Law®: Betting on Sports Betting by Professor I. Nelson Rose

New Jersey has now lost, at least at the trial court level, its most recent and last attempt to get casino and track sports books through legislation. New Jersey voters amended its State Constitutional; the State Legislature passed bills, two of which were signed by Governor Chris Christie; and, Christie even declare, through his appointed acting Attorney General, that the state would no longer enforce its criminal sports betting laws. The state can now literally do nothing, other than appeal the latest defeat in federal court and beg Congress to pass a law.

As if Congress passes any laws.

New Jersey has little chance of succeeded. Christie will be appealing his latest federal district court defeat, Nat'l Collegiate Athletic Ass'n v. Christie, to the same Third Circuit Court of Appeals which rejected the previous attempts to bring in sports betting. And the Republicans in Congress made a decision that they would not approve anything that President Obama wanted, even if the policies were Republican ideas. So, Congress has passed literally almost no new substantive laws since the GOP took over the House of Representatives in January 2011.

The federal court decisions barring New Jersey from adding sports books to its racetracks and Atlantic City casinos were unduly complex. They were also, at least at first, probably wrong. But their impact will be exactly what the National Football League and other organized professional and college sports organizations, (except, perhaps, the National Basketball Association), want. We will probably not get another test case for years, because legislators in other states will be scared off, because legalizing sports betting now appears to involve complicated constitutional issues. A bill to legalize sports betting passed the California Senate, but died in the Assembly after the first New Jersey federal trial court decision came out.

It is too bad. The 9th Circuit and other federal courts might very well have ruled the other way. The federal law in question, the Professional and Amateur Sports Protection Act, is actually one of the most radical federal statutes ever based, and fairly easy to throw out as unconstitutional.

PASPA is also known as the Bradley Act, because its main advocate was then-U.S. Senator Bill Bradley, a former professional basketball player. Bradley was concerned with the expansion of sports betting, especially through state lotteries. So he got his colleagues in Congress to pass a federal law in 1992 which, for the first time in history, prevents states from changing their public policies on gambling.

In the 1970s, the Delaware State Lottery starting taking bets on professional football games. The National Football League and its teams sued – and lost! There is a general perception that the NFL won, because the court did issue an order and Delaware did stop taking bets on sports events. But the order was very limited, and Delaware discontinued its sports lottery solely because sales of the games, which were limited to parlay bets, were disappointing.

The NFL had sued for what it called a “forced association with gambling.” The federal District Court characterized the plaintiffs’ claims that Delaware’s football lottery interfered with their property rights. The complaint contained “counts based on federal and state trademark laws, the common law doctrine of misappropriation, the federal anti-gambling laws, the Civil Rights Act of 1871 (42 U.S.C. s 1983), the Delaware Constitution and the Delaware lottery statute.”

The problem for the NFL was the Delaware Lottery never used the teams’ names. Players had to beat the line, or point spread, in at least three games, labeled as “Philadelphia v. Los Angeles,” not “Eagles v. Rams.” Even if the Lottery had used the teams’ actual names, there would have been no tradename infringement. As the Court put it, “a specialist in the repair of Volkswagen cars may tell the public of his specialty by using the word ‘Volkswagen.’”

This article in full will appear in the upcoming issue of Gaming Law Review & Economics

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