16TH AUG 2017 | WRITTEN BY: CHRIS SIEROTY
If the U.S. Supreme Court rules New Jersey can offer legal sports betting, the four major U.S. professional sports leagues may not be pleased with the outcome but they are likely to be prepared for that outcome, a panel of experts said Tuesday.
David Purdum, a gambling reporter with ESPN, said if the leagues were to lose their case, they “would relinquish all control of sports betting.”
Currently, the leagues have control by being able to go to court to block any proposed expansion of sports betting in the U.S. That is lost if the Supreme Court overturns the federal ban on wagering on sports.
Purdum said the best-case scenario for the leagues would be a “direct and significant revenue stream” from legal sports betting in the U.S. The catch, Purdum said, is the leagues will want to avoid the appearance of making that direct connection to gambling.
The Supreme Court is expected to hear New Jersey’s challenge to the scope of the Professional and Amateur Sports Protection Act (PASPA) by late fall or early winter.
Purdum added that he did not think a loss would be the worst case scenario for professional sports leagues. He believes they are worried about a patch work, or state-by-state, system of regulations with no revenues for the leagues.
“It still comes back to they want to make money,” Purdum said.
Andrew Brandt, director of the Jeffrey S. Moorad Center for the Study of Sports Law at Villanova University, said on the legal front, the Supreme Court taking this case is a big deal.
The court decided to take up the case despite the U.S. solicitor general’s opposition and the Supreme Court’s denial in 2014 to consider an earlier version of this case.
Brandt said “evolving” was the word he kept hearing when it came to the position of the four major professional sports leagues — the National Football League (NFL), the National Hockey League (NHL), Major League Baseball (MLB) and the National Basketball Association (NBA) — on sports betting.
“We are only three years from [former Dallas Cowboys quarterback] Tony Romo being told he couldn’t attend a fantasy sports conference in Las Vegas,” Brandt said. “Not because it was Vegas, but because it was held in a casino.”
“We are at a different point today,” Brandt said.
Both Brandt and Purdum participated Tuesday in a webinar presented by Clarion Gaming on preparing for the Supreme Court’s New Jersey decision and options for the sports industry.
Moderator Daniel Wallach, a gaming attorney with Becker & Poliakoff in Fort Lauderdale, Florida, asked if Nevada should be concerned that the court could decide not only to maintain a wagering ban on New Jersey but also extend the betting prohibition to the Silver State.
Wallach called it the “doomsday scenario,” where the court kills an industry.
He cited an article by Ryan Rodenberg, who teaches at Florida State University and is considered an expert on PASPA, that said the Supreme Court might simply eliminate the exemptions from PASPA instead of overturning the federal ban.
Under PASPA, which Congress passed in 1992, Nevada is completely exempt from the federal sports-betting ban and Delaware, Montana and Oregon are partially exempt.
Beyond those four states, evidence from Congress indicates Arizona, New Mexico, North Dakota, South Dakota and Wyoming also are exempt from PASPA in varying degrees, according to Rodenberg’s article in the Duke Law Review.
Purdum acknowledged the doomsday scenario as a possibility, but from a practical standpoint it is unlikely that the justices would decide to take away an industry that generated $4.5bn in bets last year.
“There will be some type of compromise and a ruling will come down the middle,” Purdum said.
Until there is a decision, the four major professional sports leagues have been reluctant to comment on the Supreme Court’s decision to take the case.
But the commissioners of the NBA and MLB, along with Major League Soccer (MLS), have said they need to be in a position to try to shape what a future regulatory scheme for sports betting might look like, even as both the NBA and MLB continue to oppose New Jersey’s efforts in court.
“There will be some point when they can’t straddle the issue anymore,” Brandt said.
Brandt expects the NFL to reach that point in about three years, when the Raiders complete their move from Oakland to Las Vegas.
“I think the NFL understands their predicament,” Brandt said. “Commissioner Roger Goodell praises Nevada’s gaming regulations, while fighting those exact same regulations New Jersey has proposed.”
Brandt, a former vice president with the NFL’s Green Bay Packers, said people associated with the NFL he has spoke to about the Raiders move to Las Vegas were concerned about whether the market was large enough to support a team or whether it is just a tourist market.
They also expressed their concern if there was long-term support for the team, he said.
All those issues, Brandt said, were more important than gambling and casinos, which “to me was an astounding response.”
Gary Bettman, commissioner of the NHL, which includes a new franchise in Las Vegas, recently told reporters: “We’re a small part of betting compared to football and basketball … I don’t worry about fixing games.”
Purdum reminded opponents of legalized sports betting that whether legal or not there are going to be scandals in the future.
“It’s time to move past that and have something more pragmatic,” Purdum said.