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TGS SPECIAL REPORT...MEANWHILE, IN THE GARDEN STATE--PART II
by Bruce Marshall, Goldsheet.com Editor


Well, if they’ve waited this long in New Jersey to come to some resolution in the state’s never-ending sports betting case, what’s a few more weeks?

Appropriately, perhaps, oral arguments in the Garden State’s landmark challenge to legalize sports wagering within its boundaries have been pushed back from this Monday, October 6, to October 31--yes, Halloween--in Trenton. US District Court Judge Michael Shipp has granted a request from attorneys in the case for additional time, although reply briefs from the state are still due later this week.

We would not advise anyone to hold their breath, however, in anticipation of placing a football or basketball bet at Monmouth Park, or one of the state's other racetracks and/or casinos in Atlantic City, anytime soon. The same patience that one must practice when traversing the New Jersey Turnpike and dealing with one of the legendary jam-ups at the toll plazas ought to come in handy on the sports gaming matter.

To re-set the table on this discussion that we reintroduced on these pages two weeks ago (and have covered extensively the past two years), New Jersey Governor Chris Christie recently decided to endorse a new measure first introduced in June (immediately after the US Supreme Court decided to not hear New Jersey’s appeal of its original attempt at legalizing sports gaming) by State Senator Raymond Lesniak that would circumvent an apparent loophole in federal law and allow the state to repeal its long prohibitions on sports gaming. By removing itself from licensing and regulating the sports wagering activities, New Jersey, according to the Lesniak proposal, would not be in conflict with PASPA (Professional and Amateur Sports Protection Act), a 1992 law which allowed select states (Nevada, Montana, Oregon, and Delaware, but not New Jersey) to be “grandfathered” by the feds to accept sports wagers, and could allow privately-run sportsbooks to operate in the state.

New Jersey continued its legislative push last week, as a State Assembly panel on Thursday released Bill A-3711, sponsored by Ralph Caputo (D-Essex), Vincent Mazzeo (D-Atlantic), John Burzichelli (D-Cumberland/Gloucester/Salem) and Raj Mukherji (D-Hudson), to rescind New Jersey’s ban on sports betting and reinforce the state’s legal argument.

To no one’s surprise, however, the US Justice Department and the sports leagues reacted predictably at New Jersey’s latest attempt to allow wagering on the games. As expected, the four major pro sports leagues and the NCAA filed a lawsuit last Monday seeking to block the Garden State’s latest bid. NFL attorneys labeled the state’s recent maneuver as “incredible, and in blatant violation of the Court’s previous injunction.” Judge Shipp, who first ruled on the New Jersey matter back in February of 2013, is being called upon once again to sort out the details.

The earlier mention of Monmouth Park is significant, because it is the one racetrack/casino venue in New Jersey that has already made physical provisions for the introduction of sports wagering. Last year, Monmouth spent $1 million building a Race and Sports Bar that was designed to be converted into an operational sportsbook in anticipation of sports betting being legalized. There are 100 TVs and a wall earmarked for a Vegas-style odds board inside the restaurant. This has been done in conjunction with William Hill, a worldwide gaming entity which also operates more than 100 sportsbooks in Nevada, and which agreed last year to be the exclusive provider of sports betting at Monmouth Park. So, whenever New Jersey gets the green light, Monmouth would be physically ready to begin accepting sports wagers almost immediately.

But, as most of our legal consultants suggest, nothing is likely to happen, sports betting-wise, at Monmouth or someplace else in New Jersey, in the near future...even if Judge Shipp rules favorably this time in the state’s favor.

The reason? Until there is some protection offered by federal law, an exemption for sports betting under state law would not necessarily resolve the risks of prosecution by the feds. Which would probably be more than enough to prevent sportsbook operators, such as William Hill, from commencing operations, at least until further notice.

Still, even if New Jersey should fail again in its upcoming legal attempt, we do not expect the sports gaming debate to go away anytime soon. That’s because PASPA is likely to be subject to another challenge...specifically from a state other than New Jersey. Recently, Florida gaming attorney Daniel Wallach, in an ESPN website interview, presented a scenario that will likely play out, sometime soon, should New Jersey be rebuffed again and the US Supreme Court is asked to examine the constitutionality of PASPA.

“The best option, I believe, is for another state, such as California, to join the fray and challenge PASPA in another federal judicial circuit in an attempt to create a circuit split,” said Wallach, who has followed the New Jersey case closely. “We could be a few years away from another showdown.”

It is worth noting that West Virginia, Wisconsin and Wyoming filed briefs in favor of New Jersey during the last Supreme Court appeal process. Moreover, California, Minnesota and Mississippi have already had discussions about the benefits of offering Las Vegas-style sports betting. Another challenge to PASPA from one of these states could trigger a circuit court split to which Wallach referred, which might inspire the US Supreme Court to reconsider the case.

A groundswell of support to repeal or alter PASPA could also be initiated through Congress. Though time consuming, sports gaming proponents might better like their chances these days in Washington, especially with the NFL having become somewhat radioactive lately in light of other recent developments. Politicians, long manipulated by “the league” in a variety of matters, are at the moment in no hurry to align themselves with the NFL. Many suggest that the league’s waning influence in Washington was reaffirmed by the recent FCC ruling that repealed the old TV “blackout” rules that had been in place since the early 1970s.

Meanwhile, as we have noted in past editorials, the NFL’s public anti-gaming stance fools nobody. Its moral objections instead camouflage the real reason for the league’s policy...the NFL simply hasn’t yet figured out a way to properly, and legally, monetize the sports wagering activity for its own good. There is certainly no anti-gaming pressure from constituent groups; among those, only moral conservatives and evangelicals would likely be strong supporters on the subject. And Roger Goodell and most league owners might be less inclined to be linked with the likes of Pat Robertson or Ralph Reed on any matter than they would to have Ray Rice do public service announcements for the NFL.

Whatever. The next important marker (and it won’t be the last) in the fascinating New Jersey sports gaming storyline is coming at the end of October. Stay tuned.



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