HomePublicationsNewsletter ArchiveNewslettersVolume 18Issue 18Momentum Builds for Sports Wagering Expansion

Last November, the New Jersey electorate, by a margin of 64%-36%, voted to amend the state constitution to allow for sports wagering to be conducted at the state’s casinos and horse racetracks if a law authorizing such wagering is passed by the legislature.  Following this vote, the New Jersey legislature quickly enacted a bill authorizing such a sports wagering scheme, and this bill was signed into law by New Jersey Governor Chris Christie on January 17, 2012.  Over the recent Memorial Day weekend, Gov. Christie remarked that the New Jersey Casino Control Commission would be drafting regulations to implement sports wagering at the Atlantic City Casinos and the state’s horse racetracks this fall.

New Jersey’s plan, however, will likely face a stiff challenge, given a 1992 federal law entitled “The Professional and Amateur Sports Protection Act” (“PASPA”).  PASPA prohibits sports wagering outside of the states of Nevada, Delaware, Oregon and Montana (all states that had some form of sports wagering or sports lottery scheme in place prior to 1992, though Nevada is the only state to offer large-scale, commercial sports wagering and its commercial casino industry holds a virtual monopoly on legalized sports wagering in the United States).  Despite PASPA’s prohibitions, however, Gov. Christie was quoted as saying that he welcomed legal action that would determine the constitutionality of the federal law, “"[i]f somebody wants to stop us, they have to take action to try and stop us.  That is going to be their burden to try and prevent it, and that's why we are doing it the way we are doing it. May we have to go through some litigation to get there? Probably, but I think we'll be successful."  

If New Jersey proceeds with its stated plans to offer sports wagering, this will likely be met with a legal challenge filed by the federal government and/or the professional sports leagues, led by the National Football League, which has long-stated its opposition to the expansion of sports wagering and has lead legal efforts to defeat sports wagering expansion attempts in the past.

In addition to New Jersey’s seeming direct challenge to the constitutionality of PASPA, two separate resolutions were introduced in Congress in January which seek to amend PASPA’s prohibitions.  House Resolution 3797 would amend PASPA to allow any state to establish a sports wagering scheme by applicable statute so long as that scheme was (a) enacted on or after January 1, 2012 and (b) is effective not later than January 1, 2016.  Similarly, though more limited in scope, House Resolution 3809 would only allow a PASPA exemption for a sports wagering scheme approved by the New Jersey legislature that is operated "exclusively in the state of New Jersey."   Both of these measures, however, were immediately referred through the House Committee on the Judiciary to the Subcommittee on Courts, Commercial and Administrative Law, where they have not moved since January 25, 2012.

Additional information on recent efforts to expand sports wagering and the expected legal challenges can be found in the article entitled, “Betting Games: Will Sports Wagering Expand in the United States?”, which appeared in the May, 2012 edition of Global Gaming Business.  A copy of this article can be found at the following link:  http://ggbmagazine.com/issue/vol-11-no-5-may-2012/article/betting-games.

 

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