GamblingCompliance: U.S. Supreme Court Case A Predicament For Sports Leagues


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.

GamblingCompliance: Fitch Sees Flat Regional Gaming Markets But Bright Future For Las Vegas


Regional casino revenues in the U.S. are expected to be no better than “flattish to slightly positive” this year, with the forthcoming Hard Rock casino in Atlantic City a threat to incumbent operators there, according to a report published by Fitch Ratings.

The ratings agency attributes its cautious outlook for some regional markets to pockets of weak consumer confidence, particularly in parts of the country reliant on the energy sector.

Revenues from casino markets outside Las Vegas were up 2 percent through the end of May, with June up on the prior year as well, Colin Mansfield, director of corporate ratings gaming, lodging and leisure, wrote in a report following meetings with gaming companies and manufacturers.

“The consumer continues to feel healthy, except in petrochemical-dependent pockets of the southeast,” Mansfield wrote, referring to Louisiana and parts of Mississippi in particular. “Northeast and western markets continue to fare better than the more mature Midwest and some southeast markets with more struggling economies.”

Mansfield told GamblingCompliance that Midwestern markets such as Indiana, Missouri and Iowa are likely to see flat revenues this year as they generally have “a relatively stable supply but not a great deal of positive economic catalysts.”

“Conversely, some pockets of slightly positive growth will likely be seen in Ohio and Massachusetts as casino openings from the past few years continue to ramp up, and markets with stronger underlying fundamentals (Florida, Las Vegas Locals),” Mansfield said.

In New Jersey, Mansfield said that most of the casino operators Fitch recently met with “believe the addition of Hard Rock to Atlantic City will negatively impact the market.”

Hard Rock International, which is owned by the Seminole Tribe of Florida, has begun a $500m renovation of the shuttered Trump Taj Mahal, which it acquired for just $50m.

Hard Rock boss Jim Allen has been bullish about the future of the Trump Taj Mahal and Atlantic City, telling attendees recently at the East Coast Gaming Congress at Harrah’s Atlantic City that the “challenging days are behind us.”

That may be so. Through the end of June, year-to-date gaming revenues in New Jersey were up 3.5 percent. However, a 28 percent increase in internet gaming accounts for a significant chunk of that and land-based gaming revenue at Atlantic City casinos was up only 1.5 percent, according to the New Jersey Division of Gaming Enforcement.

New Jersey currently has seven casinos in Atlantic City, with the Atlantic Club, Showboat, Revel, Trump Plaza and Trump Taj Mahal casinos all closing between January 2014 and October last year.

Mansfield on Thursday reiterated his concern that the addition of Hard Rock “will negatively impact some of the current operators.”

“Atlantic City has stabilized around a $2.4bn per year market and the current operating environment (with seven properties) has been healthier,” Mansfield told GamblingCompliance. “It’s allowed the remaining operators to increase their profitability relative to a few years ago when there were as many as 12 properties.”

As for Las Vegas, Mansfield noted that the development of non-gaming offerings continues to “be in favor given the strength of visitation and convention business in the face of stagnant room supply.”

The next injection of new supply on the Las Vegas Strip is expected to come when Malaysia’s Genting Group opens the $4bn, 3,000-room Resorts World Las Vegas project.

The Malaysia-based Genting bought the property in 2013 from Boyd Gaming for $350m. Boyd had started building a resort on the site of the former Stardust casino when the recession struck, leaving just a steel-and-concrete skeleton standing on the property.

In a note to clients, Mansfield and fellow Fitch analyst Alex Bumazhny said the Resorts World property “has not changed much since our last visit in October.”

Meanwhile, the stalled Alon casino project appears to continue to be up for sale, the analysts noted.

By the time Resorts World opens, Las Vegas will have hosted its first NFL game after owners approved the relocation of the Oakland Raiders to southern Nevada in time for the 2019 season.

“All [casino] operators feel the new NFL franchise is positive for the long-term health of Las Vegas and will help boost visitation around the eight home games,” Mansfield said, citing meetings with nine gaming companies including Las Vegas Sands, Wynn Resorts, MGM Resorts International, and Caesars Entertainment.

GamblingCompliance: Resorts Casino Launches DFS In New Jersey


Resorts Casino Hotel has become the first property in Atlantic City to offer its customers a chance to play real-money daily fantasy sports (DFS) contests, even as a bill regulating and taxing the industry sits on Republican Governor Chris Christie’s desk.

Offered by Resorts Digital Gaming, FastPick is an online fantasy game that pits the contestant against the house, not other players.

Ed Andrewes, CEO of FastPick, told GamblingCompliance that FastPick was created to provide an alternative to traditional DFS sites and eliminate the advantage held by expert DFS players who are thought to be winning the majority of money on sites such as DraftKings and FanDuel.

One of the company’s chief findings was that players lose interest when they realize they are competing against “professional” DFS players with far more time, knowledge, and in some cases, the benefit of assistive technology.

“We wanted to offer something that was simple and enjoyable for customers to play against the house,” Andrewes said, calling FastPick “the next generation of fantasy sports.”

In FastPick, DFS players compete in a series of head-to-head match-ups of real-world athletes.

For example, a customer can choose whether New England Patriots quarterback Tom Brady or Aaron Rodgers of the Green Bay Packers will have a better statistical performance on an average NFL Sunday.

FastPick also offers DFS games associated with basketball, baseball, hockey and soccer.

The contestant’s selections are then put up against the casino’s and if the customer’s team of players gains more points than those assigned to the casino, the customer wins.

Andrewes said FastPick is designed to fit into fantasy sports regulations approved in New Jersey several years ago.

Andrewes said the DFS contests are currently only available online, including Resorts’ online casino, and not yet in the Android or Apple app store. He expects to have kiosks on the casino floor by the fourth quarter.

The move into Atlantic City is the latest expansion of DFS into casino markets. USFantasy Sports, which uses a pari-mutuel system, is licensed and offered by casinos in Nevada.

Robert Ambrose, a gaming consultant in Philadelphia, believes adding DFS is a positive and timely move for Resorts.

“It’s a model that offers more opportunity to the masses and less skilled DFS player,” Ambrose told GamblingCompliance in an email. “This is also another way to connect the online gaming community with the physical presence of the host casino.”

At the moment, FastPick is only available to people physically located in New Jersey. Andrewes said FastPick is taking a conservative approach when it comes to expansion, with a rollout into New York casinos next on the list.

A New Jersey bill, A 3532, currently sits on Republican Governor Chris Christie’s desk that would regulate and tax DFS contests, but gaming regulators say DFS is already legal for casinos in New Jersey due to the state’s internet gambling laws.

The DFS bill, sponsored by state Senator Jim Whelan, a Democrat from Atlantic City, would require companies such as FanDuel and DraftKings to obtain operating permits and pay 10.5 percent of their gross revenue to the state.

The release of FastPick comes as the DFS market deals with the fallout from the failed merger between DraftKings and FanDuel, and as the U.S. Supreme Court prepares to hear New Jersey’s appeal to legalize sports betting within its borders.

New Jersey is asking the Supreme Court to overturn the Professional and Amateur Sports Protection Act (PASPA), which bans sports betting in all states except Nevada, with partial exemptions in Delaware, Montana and Oregon.

“We are very supportive of New Jersey’s effort to [legalize] sports betting,” Andrewes said. “I believe that PASPA will be repealed. But, this gives us an opportunity to establish a brand [as we] build up expertise and a customer base.

“I think this product stands on its own two feet … with or without sports betting.”

Ambrose also said he thought it would be “a while before you see a turn-over or modification to PASPA.”

“Remember it does not reference DFS,” Ambrose said of the 1992 federal law. “However depending on the outcome here in New Jersey you will see state by state challenges. If New Jersey is successful in their sports-betting initiatives there will be a testing of it nationwide.”

Ambrose added that as far as the current DFS model offered by Resorts is concern, “some may go back to the debate of skill vs. chance. The current Resort game being offered is a positive and good for Atlantic City gaming.”

According to the Fantasy Sports Trade Association, there are 59.3m people playing fantasy sports in the U.S. and Canada. Last year, players spent more than $3.26bn on DFS.

PaymentsCompliance: U.S. Regulator Defends Fintech Charter From State Hostility


U.S. federal authorities have defended plans to give fintechs an alternative to state-by-state regulation, despite mounting pressure from politicians, state lawmakers and industry insiders.

Kathy Oldenborg, director of payment systems policy at the Office of the Comptroller of the Currency (OCC), told a conference in Washington, D.C. that a limited-purpose charter for fintech companies would not mean non-banks are subject to a light-touch regulatory regime.

Speaking at the American Bankers Association’s (ABA) Payments Forum last week, Oldenborg emphasized that the proposals are about minimizing risk as well as supporting innovation.

The OCC’s broader initiative was “to signal banks that it’s okay to innovate,” she said.

“You can work with fintech companies, you can partner with fintech companies, you can buy one if you want,” she added. “There’s nothing that says you can’t work with fintech companies outside this whole chartering discussion.”

Oldenborg added that the national fintech charter proposal is about the federal agency’s support for innovation while minimizing risk.

The OCC announced its intention last year to allow fintech companies to apply for special purpose national bank charters, and in March, after reviewing public commentary, published a draft of its guide for evaluating such applications.

The non-depository charter would effectively allow non-bank companies offering bank-like services to operate under a similar national regime, subject to regulation and oversight by the OCC.

Currently, such firms would have to apply for individual licensing in every state where they wish to operate.

Rob Morgan, the ABA’s vice president of emerging technologies, said at last week’s event that the group supports the OCC’s efforts to hold chartered fintech companies to the same standards as banks.

However, the proposals have sparked outrage from regulators at state level, who fear the initiative will pre-empt their authority over non-banks headquartered in their jurisdiction.

Margaret Liu, senior vice president and deputy general counsel at the Conference of State Bank Supervisors (CSBS), said the organization believes that by proposing the limited-purpose charter, the OCC had overstepped its authority under the National Bank Act.

The CSBS and a group of state regulators filed a lawsuit in April trying to prevent the OCC from moving forward with its charter proposal.

Liu said that chartered banks have a well-developed set of rights and responsibilities, but that chartering fintech companies as banks will cause turmoil for those rights and responsibilities.

“A federal license to do business is the exception, not the rule,” Liu said.

Liu was not the only speaker to voice concerns about the OCC’s plans — which were made under former comptroller Thomas Curry — to issue national bank charters to fintech firms.

Illinois Republican Representative Randy Hultgren, who is co-chair of the House Fintech and Payments Caucus, argued there is a bigger role for Congress to play in the discussion about allowing fintech firms to operate as national banks.

“If a healthy debate in Congress leads to a change in the law specifying a new authority for the OCC to issue some sort of special-purpose charter, or fintech charter, then the people will have spoken at that point,” Hultgren said in a speech to the conference.

He said that he would welcome further debate on the OCC proposal, although added there are currently no hearings scheduled.

Jason Henrichs, co-founder of FinTech Forge, told attendees that he liked the intent of the fintech charter scheme but said the OCC risks stifling innovation.

Henrichs, who participated in a discussion on how to maximize bank and fintech partnerships, noted that fintech firms were “where all the innovation is happening.”

Oldenborg declined to comment on when the OCC will finalize its fintech charter plan or begin accepting applications.

GamblingCompliance: Cyberattacks A Risk To All Businesses, Expert Warns

The fact that the Iranian government successfully targeted a Las Vegas gaming company and Russians tried to manipulate the U.S. election system should have significant implications for all businesses, a leading U.S. terrorism expert warned last week.

Counter-terrorism specialist Reid Sawyer, a senior vice president of credit, political and security risks with risk consultancy JLT, said every company executive needs to understand that cyber risk is a global issue.

“What I mean is the geography is irrelevant these days. Doesn’t matter if it’s coming from Russia, Ukraine or China, or from a criminal organization in the United States,” Sawyer told attendees of the American Bankers Association’s (ABA) Payments Forum.

Criminals and foreign governments are targeting all industries, including the gaming and hospitality industry.

Gaming’s most high profiled cyberattack occurred in February 2014, when the Iranian government was behind an attack on Las Vegas Sands’ computer systems and stole credit card data, social security numbers and drivers’ license numbers.

Sawyer said that cyber espionage — both state-based and criminal actors — poses significant risks that must be understood across the breadth of an organization. He described it as the new battlefield in terms of business risk.

“We need to stop talking about cyber risk in terms of cyber,” Sawyer said. “Cyber is just a means to get into your organization … to disrupt business to consumer or business to business activities, or disrupt your overall organization.”

When you put it in those terms, Sawyer said, “it is no longer a cyber risk, it is a business risk.”

He added that most businesses fail to understand the risks to their organizations, even though they have cyber directives. Sawyer criticized businesses for only looking at replacement costs.

“It’s a completely insufficient way to look at it,” Sawyer said. “You need to understand the financial risks. Why aren’t we talking about the P&L (profit and loss) risks or your earnings per share?”

He added that if you flip the way a company views the risk, then “you can recognize the problem in a different way.”

Sawyer was the keynote speaker on Thursday at the ABA’s inaugural Payments Forum, a two-day conference exploring the future of financial transactions in Washington, D.C.

“The greatest cyber threat we face is from our own actors,” Sawyer said. “John Podesta here in Washington clicked on malware and opened up the DNC’s (Democratic National Committee) emails.”

The DNC cyberattacks took place in 2015 and 2016, in which computer hackers infiltrated the DNC computer network, leading to a data breach. Cybersecurity experts say the espionage was the work of Russian intelligence agencies.

The attack allowed internal communications to stream into public view during the 2016 presidential election between former Secretary of State Hillary Clinton and current President Donald Trump.

Sawyer said the majority of cyber breaches come from willing or unwilling employees within corporations.

The gaming business and casino regulators have already acknowledged that the industry faces a mounting cybersecurity challenge.

In July 2016, the Hard Rock Hotel & Casino in Las Vegas suffered a second data breach which provided hackers with access to payment card data, including name, card number, expiration date and internal verification codes. Hard Rock faced a similar breach in May 2015.

The Las Vegas Sands-owned Venetian and Palazzo in Las Vegas and Sands Bethlehem in Pennsylvania were hit be a significant cyberattack in 2014, which was later linked to the Iranian government.

The FireKeepers and Four Winds tribal casinos in Michigan, as well as the Peppermill Casino in Reno, Nevada, and Casino Rama in Ontario, Canada, have also all been victims of cyber crimes.

The attacks range from malware software being placed on a payment card system, to email viruses being opened by employees that infect a company’s computer system.

Both New Jersey and Massachusetts have increased their cybersecurity rules, with New Jersey now requiring casinos’ heads of information security to be afforded the same level of responsibility as heads of audit or other departments.

In terms of cyber threats, Sawyer urged companies to move from the notion of whether they are appropriately protected to asking: “What is the enemy doing to us?”

“We don’t get that this is a business risk,” Sawyer said, citing an EY survey that found 68 percent of company executives would not change their IT spending if the supplier was breached.

Sawyer also said he was shocked at the amount of commercial espionage activity.

“The FBI will tell you the activity we are seeing from state to commercial is exceeding our ability to respond to it,” Sawyer told some 200 attendees during his 45-minute presentation.

“What we are seeing now is private warfare. States are no longer seeing state to state warfare as a legitimate target.”

He said that the government believes they can attack U.S. businesses with the idea “of destruction or damage.”

“That does far more damage to the U.S. in the long run,” Sawyer said. “It is the economy that is being targeted.”

Sawyer cited Iran’s response to Stuxnet, a computer worm that destroyed centrifuges inside the country’s Natanz uranium enrichment site. The cyberattack plan also targeted Iran’s air defenses, communications systems and key parts of its power grid.

“Iran’s response wasn’t against the Pentagon … it was against 50 financial institutions in the United States,” Sawyer said. “Data integrity is the payments industry’s greatest risk.”

GamblingCompliance: New Jersey Tracks Eye Historical Racing As Revenue Boost


Horseracing in New Jersey has fallen on hard times, and to help boost revenues, purses and attendance at the state’s three racetracks, track executives and lobbyists believe historical racing is key to their survival.

Representatives from the racing industry recently appeared in Trenton before members of the New Jersey legislature calling on lawmakers to approve a measure to legalize the games.

“Based on models in other states, purses would be increased significantly so as to enable us to be more competitive with surrounding states, which have slot or casino revenue,” said Dennis Drazin, an advisor to the New Jersey Thoroughbred Horsemen’s Association.

“We do believe historical racing will increase attendance,” Drazin told GamblingCompliance in an email.

Historical racing, also known as instant racing, is a form of electronic gambling machine that allows players to bet on replays of horse races or dog races that have already run.

The machines are marketed and sold as a legal form of pari-mutuel wagering, with outcomes determined by pooled bets on previously run horse races.

“Customers bet on historical racing because it’s fast, simple and similar to slot machine play, but based on a pari-mutuel model,” Drazin said. “Fans are given past performance data, but can’t identify the race.”

Historical racing is already offered in Arkansas, Kentucky, Wyoming and Oregon with $1.1bn bet on the product in four states last year.

Idaho and Texas had approved historical racing, but then pulled the plug on the machines.

The Idaho legislature, for example, approved the machines in 2013 but then in 2015 lawmakers banned historical horseracing after concerns were raised the machines resembled illegal slot machines.

New Jersey Assemblyman Ralph Caputo, a Democrat and chairman of the Assembly Tourism, Gaming and the Arts Committee, said his committee was “very interested in learning about this new concept … that has been established in some other states and has been very, very profitable and also very successful.”

“The horseracing industry has deteriorated over the last number of years due to a lack of state support and also because of changing demographics,” Caputo said.

“Obviously, the state needs revenue, the horseracing industry needs revenue,” Caputo said. “So, we are very interested in any new concept that would help the racing industry, but also the general state of the economy of New Jersey.”

Chris McErlean, vice president at Penn National Gaming, owner of Freehold Raceway, agreed the New Jersey racing industry was struggling.

McErlean on Tuesday praised Caputo for holding a hearing on the issue, and was hopeful that historical racing gets some momentum in the legislature.

In 2011, Republican Governor Chris Christie ended a $30m annual subsidy for purses that Atlantic City casinos paid the racing industry to compensate them for a prohibition on slot machines.

The Assembly committee discussed historical racing at a June 1 hearing, but as of Tuesday had not scheduled a hearing to vote on Assembly Concurrent Resolution 196.

Senate Bill 2886 introduced in January also would permit historical racing in New Jersey.

As the results are based on actual pari-mutual races that took place in the past, supporters believe the format does not require voter approval.

Marshall Spevak, chief of staff for Assemblyman Vince Mazzeo, a Democrat who represents Atlantic City and is vice chairman of the Tourism, Gaming and the Arts Committee, said Tuesday that if historical racing is gambling then “there is a constitutional question.”

Under New Jersey’s constitution, new forms of gambling are prohibited unless they have been approved by state-wide referendum.

Spevak said his boss was “very protective of the casino business in Atlantic City.”

“That’s really the point, making sure we are not expanding gambling beyond Atlantic City,” said Spevak, adding that there needs to be “a lot more research and thought that goes into this.”

However, racing supporters insist historical racing machines simply give tracks a chance to sell their product in a new way.

Scott Wells, president and general manager of Remington Park and Lone Star Park, told attendees at last month’s Pan American Conference in Washington that historical racing was the next step in the evolution of pari-mutuel wagering.

“Not to allow racetracks to have historical racings … is a restriction of fair trade,” Wells said. “It keeps the industry in handcuffs.”

GamblingCompliance: New Jersey To Continue Sports-Betting Battle As NBA Favors Federal Solution


The U.S. Solicitor General’s Office may have dealt a knockout blow to New Jersey’s six-year battle to legalize sports betting, but the state’s top gaming regulator says efforts will continue.

“We are still on hold,” David Rebuck, director of New Jersey’s Division on Gaming Enforcement (DGE), said Wednesday. “Right now, the long legal history of this case, we continue to fight the good fight.”

The solicitor general last week recommended that the Supreme Court not hear New Jersey’s case challenging the scope of the 1992 Professional and Amateur Sports Protection Act (PASPA).

PASPA bans legal sports betting in all states expect Nevada, Delaware, Oregon and Montana.

In the court brief, solicitor general Jeffrey B. Hall wrote that the case did not deserve the attention of the Supreme Court, as New Jersey had not raised valid constitutional problems and other states had yet to pursue similar legislation.

Still, sports-betting advocates remain unbowed.

“Hope springs eternal,” Joe Asher, CEO of William Hill US, said Wednesday about the prospects of rolling back the federal sports-betting ban.

“I think it was expected the solicitor general would weigh in against the court taking the case.”

But Asher predicted that if the Supreme Court allows PASPA to stand, there will be other litigation to follow in other jurisdictions. He put the chances at just 20 percent that the Supreme Court would hear the case following the solicitor general’s opinion.

Both Rebuck and Asher participated in a panel discussion at the IAGA International Gaming Summit in New York City.

Asher described PASPA as a “really obsolete law,” which has “created a large black market for illegal sports betting.”

The American Gaming Association (AGA) has estimated illegal sports betting to be a $150bn business in the United States. Others have estimated the value to be around $400bn annually.

“Clearly there is activity that is widespread throughout the United States,” Asher said.

There seemed to be division among the IAGA panelists as to who should regulate sports betting if and when it expands beyond Nevada.

Dan Spillane, senior vice president and assistant general counsel with the National Basketball Association (NBA), said there was no division about whether sports gambling should be legalized; the only disagreement is how you get there — state or federal regulation?

“The NBA endorses a federal solution,” Spillane said.

That position appears to go against the AGA’s and Rebuck’s preferred solution of states being able to choose the terms upon which they want to regulate sports betting.

Rebuck said that he was not against some federal minimum standards, but he believed there should be a state-by-state model to oversee “this type of wager in the future.”

The NBA, National Hockey League (NHL), Major League Baseball (MLB) and the National Football League (NFL) have all softened their traditional opposition to gambling in the last few years.

The NHL approved the Vegas Golden Knights as its 31st franchise that will take to the ice in September. Meanwhile, NFL owners voted 31-1 in March to allow the Oakland Raiders to move to Las Vegas, and gambling was not even an issue.

Asher said the one owner who voted against the move was concerned about teams moving, and not about any issues dealing with gambling.

Spillane admitted that the NBA helped drive the passage of PASPA out of concern over the integrity of their games.

But its position on sports betting has evolved since then.

“We have a global business,” Spillane said. “That global perspective shows us how they do it.”

As New Jersey waits for a decision from the Supreme Court, advocates are known to be lining up a further test of PASPA’s scope via a move to repeal the state’s prohibitions on sports betting and effectively permit the activity without any system of regulation.

A bill is expected to be introduced in the New Jersey House and Senate if the Supreme Court, as expected, rejects the state’s plea for a hearing on its sports-betting appeal.

Asher said that it is a “possibility that could happen.”

But Rebuck told GamblingCompliance after the panel that it was too early to discuss the possibility of New Jersey repealing its prohibition on sports gambling.

He expects a decision on whether the Supreme Court will hear the case by the end of June.

If you look at the state of gaming in the United States, it has “increased massively” since 1992 when PASPA became law, Rebuck said.

“Forty-nine states have some sort of legalized gambling,” the regulator said. “It used to be 48 states … I now call Utah in the box of legalized gambling. They don’t know it but they authorized daily fantasy sports (DFS) play.”

Rebuck added that most regulators believe DFS is “sports betting and if it is not sports gambling then it’s very close.”

He said DFS has raised the issue of sports betting with the general population.

“We love fantasy sports in the state of New Jersey for that reason,” Rebuck said.

Rebuck’s comments also came about a week after New Jersey Congressman Frank Pallone published draft legislation to overturn PASPA and establish a federal regulatory scheme for sports betting overseen by the Federal Trade Commission.

The proposed bill, known as the Gaming Accountability and Modernization Enhancement (GAME) Act, would also clarify the legality of online poker and casinos.

“Only Congress could come up with the GAME Act,” Rebuck said. “Whether it becomes legislation … it’s in its very early stages. It’s a start.”

Spillane said the NBA was looking at Pallone’s bill, but had no comment on the potential of the GAME Act becoming law.

“I appreciate it as another step forward,” Spillane said.