US Federal Court Strikes Down PASPA (Update)
New Jersey wins landmark sportsbetting appeal
In a landmark ruling, the U.S. Supreme Court, by a vote of 7 to 2, has thrown out the Federal Professional and Amateur Sports Protection Act (PASPA) in the case MURPHY, GOVERNOR OF NEW JERSEY, ET AL. v. NATIONAL COLLEGIATE ATHLETIC ASSN. ET AL..
InfoPowa readers will recall PASPA was enacted in 1992, ostensibly to protect integrity in sport.
The Act outlawed all sports pools outside of Nevada State and sports lotteries outside of the States of Oregon, Delaware, and Montana.
A separate provision in PASPA gave States who had operated licensed casino gaming for the previous ten-years (such as New Jersey) the opportunity to legalise sports gambling within one year of the Act’s effective date, a provision New Jersey failed to trigger by the deadline.
By 2012, looking to shore up Atlantic City’s dwindling casino industry, the New Jersey State Legislature enacted the Sports Wagering Act but was challenged by major professional sports leagues who used Federal law, PASPA, to block the attempt.
New Jersey made numerous submissions challenging PASPA through the courts claiming the Act violated the Constitution’s tenth commandment “anticommandeering principle” by preventing the State from modifying or repealing its own laws that prohibited sports gambling, but was ultimately denied by the United States Court of Appeals for the Third Circuit.
In a final bid, New Jersey took its appeal to the Supreme Court of the United States, the decision of which has been highly anticipated.
“Congress can regulate sports gambling directly, but if it elects not to do so, each State is free to act on its own,” the opinion of the Supreme Court reads.
“Our job is to interpret the law Congress has enacted and decide whether it is consistent with the Constitution. PASPA is not. PASPA “regulate[s] state governments’ regulation” of their citizens, New York, 505 U. S., at 166. The Constitution gives Congress no such power.
“The judgment of the Third Circuit is reversed.”
In a statement, New Jersey State Governor Phil Murphy said he was “thrilled to see the Supreme Court finally side with New Jersey and strike down the arbitrary ban on sports betting imposed by Congress decades ago.
“New Jersey has long been the lead advocate in fighting this inherently unequal law, and today’s ruling will finally allow for authorized facilities in New Jersey to take the same bets that are legal in other states in our country.”
Murphy attributed an “incredible bipartisan effort from many in the state” for the victory, particularly former Governor Chris Christie and former State Senator Ray Lesniak.
“I look forward to working with the Legislature to enact a law authorizing and regulating sports betting in the very near future,” Murphy concluded.
New Jersey, in anticipation of this ruling, began regulatory processes months ago, inviting interested sportsbetting operators to submit their applications to the New Jersey Division of Gaming Enforcement who will oversee and regulate the sportsbetting industry in the State.
Likewise numerous terrestrial and online operators have invested in and aligned their focus towards a positive ruling for the industry, with many said to be in a position of having the capability to rollout the vertical almost instantaneously.
As InfoPowa readers will be aware, as many as eleven U.S. States have either passed or submitted new sportsbetting bills (see previous InfoPowa reports).
Genius Sports And NCAA Announce Tie Up
In the wake of Supreme Court PASPA ruling
The National Collegiate Athletic Association (NCAA) is about to overhaul its data statistics service in a new partnership with London-based Genius Sports who will also be come the NCAA’s exclusive data licensing agent.
Described as a landmark initiative, the partnership will transform the digital collection and distribution of intercollegiate sports data which the NCAA says will benefit its 1,100 plus member institutions across all three divisions and will be used in select NCAA championships, starting with men’s and women’s basketball tournaments in 2019.
The technology will subsequently be rolled out to schools for other NCAA sports, including volleyball, football, soccer, baseball and softball, the Association said.
The software platform will be offered to members at no cost for an introductory period as the NCAA believes the adoption of the platform will be of benefit in terms of improved efficiencies that include “enhanced data capture and distribution services, richer coaching insights, and the ability to captivate fan and media experience by delivering engaging statistics to multiple platforms in real-time”.
In addition to the technical agreement, Genius Sports will serve as the NCAA’s exclusive agent in licensing real-time official data from championship events, including NCAA March Madness, to media platforms and other companies.
“This digital transition comes at a time when data for all intercollegiate sports are increasingly important to our fans, our institutions and our partners,” said Oliver Luck, executive vice president of regulatory affairs and strategic partnerships for the NCAA.
“This initiative will transform the way we collect, use, and distribute the vast amount of sports data being consumed across all sports at every level. It will allow our schools to upgrade to state-of-the-art technology.”
“This technology will deliver a world-class experience for NCAA fans, coaches, players, athletic directors and administrators alike,” added Mark Locke, CEO of Genius Sports. “We’re delighted to be playing a pivotal role in the NCAA’s digital transformation, implementing one of the most advanced technology systems in sports.”
All Aboard The US Sportsbetting Train
Flurry of activity following Supreme Court ruling on PASPA
Predictably there’s been a flurry of activity following the US Supreme Court ruling which struck down PASPA Monday (see previous InfoPowa report) opening the doors to legal sportsbetting in the U.S., a welcome and momentous ruling for the gambling industry as a whole.
The Stars Group welcomed the ruling saying the decision opens the door for the Group’s broad expansion in the United States.
“The decision by the Supreme Court is an important step forward in the regulation of sports betting in the United States,” Marlon Goldstein, Executive Vice President and Chief Legal Officer of The Stars Group, said.
“We believe we are well-positioned to take advantage of any new business and market opportunities, and to work with state legislatures in setting up sports betting frameworks that satisfy local consumers’ interest in sports betting while protecting them through safe and regulated betting environments.”
B2B sports betting technology provider Kambi Group said the decision has created a significant business opportunity for Kambi, vindicating their long-term regulated market strategy.
“Today’s Supreme Court judgment marks the beginning of an exciting new chapter for Kambi,” Kristian Nylen, Chief Executive Officer, said.
“We have been working towards this day since our inception, putting in place the foundations to ensure the business would be ready for a legal US sports betting market when it arrived.
SBTech’s chief executive officer Richard Carter described the decision as a historic day for the industry. “We look forward to working closely with all stakeholders and helping shape an open and responsible environment for sports betting to flourish in the US, which addresses the needs of consumers, law enforcement, regulators, sports integrity, operators and technology providers.
US Trade body, the American Gaming Association (AGA) tagged the ruling a victory for the millions of Americans who seek to bet on sports in a safe and regulated manner.
“The AGA stands ready to work with all stakeholders – states, tribes, sports leagues, and law enforcement – to create a new regulatory environment that capitalizes on this opportunity to engage fans and boost local economies,” a press statement reads.
Federal Moves To Regulate Sports Betting?
Author of PASPA about to introduce new federal legislation to Congress
Sen. Orrin Hatch, the author of the restrictive Professional and Amateur Sports Protection Act which was struck down as unconstitutional this week by the US Supreme Court, has revealed that he is working on a new legislative proposal to involve Congress in the regulation of the sector, whilst respecting individual states’ rights to pass their own laws.
In a press statement Tuesday, Hatch said he plans to introduce legislation in Congress designed to reassert federal influence over the industry, which is expected to boom as individual US states implement their own sports betting legislation.
The statement notes: “At stake here is the very integrity of sports. That’s why I plan to introduce legislation in the coming weeks to help protect honesty and principle in the athletic arena. I invite stakeholders and my colleagues on both sides of the aisle to join me in addressing this important issue.”
“Congress will seize this opportunity to establish fundamental standards for sports betting that will uphold the integrity of the game,” the press release added, emphasising the need for the protection of consumers, problem gamblers and minors, but respecting the rights of US states to decide whether to implement their own intrastate legislation.
The senator showed his disdain for online activity by commenting:
“The rapid rise of the Internet means that sports betting across state lines is now just a click away. We cannot allow this practice to proliferate amid uneven enforcement and a patchwork race to the regulatory bottom.”
Whilst the brief statement was short on detail, most industry observers concluded that Hatch’s intention appears to be to set federal standards and regulations for liberalised sports betting, which has now become a fait accompli following the Court’s decision.
The Supreme Court does not appear to have placed any impediments on Congressional involvement, concluding: “Congress can regulate sports gambling directly, but if it elects not to do so, each State is free to act on its own.”
In related news, major sports leagues in the US which have for years vehemently opposed New Jersey attempts to liberalise the sports betting industry, waded in with pleas for Congressional involvement following the (for them) negative Supreme Court finding.
The largest of the leagues, the NFL issued a statement declaring:
“The NFL’s longstanding and unwavering commitment to protecting the integrity of our game remains absolute. Congress has long recognized the potential harms posed by sports betting to the integrity of sporting contests and the public confidence in these events. Given that history, we intend to call on Congress again, this time to enact a core regulatory framework for legalized sports betting.”
Around 14 US states, notably large regions like New Jersey and Pennsylvania, have either already created or are in the process of creating legislation to enable intrastate sports betting.
SBTech Partners Churchill Downs In The US Market
Initial entry into New Jersey, Pennsylvania and Mississippi
Churchill Downs Incorporated (CDI) has moved quickly in the wake of the U.S. Supreme Court’s decision to strike PASPA down agreeing a strategic partnership with SBTech and heralding its entry into the real money online gaming and sports betting markets in the U.S.
Under the terms of the deal, SBTech will supply its integrated technology platform for CDI’s iGaming and sports betting operations consisting of a consumer website, mobile apps, and back office systems, pursuant to which CDI may offer branded products separate from TwinSpires.com to its iGaming and sports betting customers.
The strategic partnership with SBTech is initially intended to enable CDI to enter New Jersey and Pennsylvania, which have already approved iGaming and sports betting.
CDI’s entry into New Jersey will be facilitated by an agreement with Golden Nugget while entry into Pennsylvania will hinge on CDI’s previously announced acquisition of Presque Isle Downs & Casino in Erie, Pennsylvania from Eldorado Resorts, Inc. and a condition that requires Eldorado to apply for certain iGaming licenses within regulatory windows.
In addition, the strategic partnership will enable CDI to enter Mississippi for sports wagering where the firm owns two existing brick-and-mortar casinos that will be utilised to offer on-property sports betting products.
“We are confident that our strategic partnership with SBTech provides us with an industry leading platform to offer innovative and exciting, integrated iGaming and sports betting products,” Bill Carstanjen, CEO of Churchill Downs, said.
“We have the unique opportunity to leverage our knowledge and experience operating the largest legal online horse racing wagering business in the U.S. as we enter the iGaming and sports betting markets.”
CDI and SBTech’s entry into these states is subject to gaming license approvals and finalisation of iGaming and sports betting regulations.
“We are thrilled to be partnering with Churchill Downs and to introduce our award-winning iGaming and sports betting platforms in the U.S.,” added Richard Carter, Chief Executive Officer of SBTech.
“We both share a deep commitment to technological innovation and excellence, and we look forward to working with them during this exciting time in the history of the U.S. gaming market.”
Kambi To Provide U.S. Gambling Group With Sportsbook
Rush Street Interactive an early mover following Supreme Court decision to liberalise US sports betting
Kambi Grouip plc has unveiled a multi-year deal to provide online US betting company Rush Street Interactive with sportsbook technology and services.
Following this week’s U.S. Supreme Court decision to repeal the country’s federal sports betting ban in full, Rush Street plans to launch a Kambi-powered Sportsbook within select states where permitted, the company advised in a press statement Thursday.
Chicago-based Rush Street Interactive is affiliated with Rush Street Gaming, which owns and operates four bricks and mortar casinos in three of the country’s largest states – New York, Pennsylvania and Illinois.
Rush Street Interactive also operates the rapidly growing PlaySugarhouse.com online casino site in New Jersey’s regulated gaming market.
In two of the four states where Rush Street operates, local lawmakers have already enacted sports betting legislation, and the other two are in the process of developing a legal framework for regulated sports betting now that the prohibition is lifted.
The agreement will see the Kambi Sportsbook integrated into Rush Street Interactive’s proprietary platform, and covers the provision of online and retail services, as well as markets outside of the U.S., if Rush Street Interactive is to expand its business internationally.
“Kambi has long kept a close eye on the U.S. market, carefully building a business and technology to suit the likely state-by-state regulation of sports betting, as well as meet the requirements stakeholders have for a safe and secure sportsbook,” Kristian Nylen, Kambi Chief Executive, said.
“This agreement with Rush Street Interactive, one of the most respected and innovative gaming companies in the U.S., is recognition that Kambi not only has online premium sports betting services ready to appeal to American sports enthusiasts, but those which will help protect the integrity of sports.”
Richard Schwartz, President of Rush Street Interactive, added that his company looks forward to launching a high-quality Sportsbook in the U.S., as well as other regulated markets internationally.