David Rebuck Says Online Sports Betting Challenge Would Follow If PASPA Were Struck Down
The Director of the New Jersey Division of Gaming Enforcement said in an interview this week the state would seek to legalize online sports betting, if ever it was successful in legalazing land-based sportsbooks. David Rebuck, the DGE’s director, also said he was “more optimistic than ever” that the state would success in regulating sports betting in the Garden Statee.
Rebuck told Gambling Insider, “To me, if you’re allowed to have sports wagering in the state of New Jersey, then the next action by the state of New Jersey will be to authorise our citizens to have sports wagering offered through the internet–legally and regulated.”
3rd Circuit Court of Appeals Is Key
The DGE’s director said all decisions are going to pivot on an upcoming appeals case which is coming before the U.S. Third Circuit Court of Appeals soon in Philadelphia. New Jersey’s appeal stems from its attempt in October 2014 to legalize a sports betting. In a trial case, the state decided to scrap previous laws which would regulate sportsbooks, and instead decided to look the other way as William Hill turned its sports bar at Monmouth Park into a sportsbook.
That decision led the four major American team sports (NFL, NBA, NHL, and MLB) and the college sports association (NCAA) to sue the state of New Jersey and Monmouth Park. New Jersey lost a case before a District Court judge in Trenton, then lost an appeal of that decision before the 3rd Circuit Court of Appeals.
Appealing the Monmouth Park Case
After the state lost its appeal by a 2-1 decision back in August 2015, it appeared Gov. Chris Christie would have no choice but to appeal to the US Supreme Court, which likely would have declined to hear the case (as it had before). Before that, the state filed a motion for a rare “en banc” hearing by the Third Circuit Court.
En Banc Ruling Expected Soon
In his interview this week, David Rebuck referred to the en banc process. He said, “As you probably well know, we were advised a while back that the Third Circuit will hear the case en banc. That is probably the first time that we had a small victory in our efforts to date. Will that transpire to a win? I don’t know, but it certainly allows for a dialogue and a briefing before the entire Third Circuit, which is unusual.”
En Banc decisions include all judges in the circuit–in this case, the 24 judges who work for the U.S. Third Circuit Court of Appeals. To receive that hearing, New Jersey needed a 12-member panel of those same judges to agree to hear the case. A favorable decision would be a clear sign the state had a chance in a wider hearing. After one of the judges recused himself, an 11-member panel decided to call an “en banc” hearing. That is the appeal which soon will be heard.
For this particular hearing to have taken place, New Jersey had to have won the appeal by a 6-5 margin at least. It is possible 9 of the judges voted on behalf of a wider hearing, because the active judges (including the 2-1 panel) were part of the panel to decide whether to hear the case again. Thus, the state is likely to need somewhere between 4 and 7 judges in the remaining 12-judge panel to agree with their interpretation of the law. If so, the 1992 PASPA law would be negated and Monmouth Park would be able to open a legal sportsbook.
“Winning Sports Gambling Is [Only] One Case”
David Rebuck said any such decision would be the beginning of a wider legalization process–not the end of such efforts. Rebuck said, “Winning sports gambling is one case. If we win that, here’s the next case we have to win: Change the sports wagering prohibition to allow for sports wagering to be performed on the Internet.”
To legalize online sports gambling, an entirely different federal statute would need to be challenged. Land-based sports betting is banned by the 1961 Wire Act. The Wire Act underpins the 2006 UIGEA law, which states it is illegal for cash transfer services to assist online gambling operators who engage in any banned activities under the 1961 Wire Act.
Challenge to UIGEA?
Thus, attempts to legalize online sports betting would be a direct challenge to the UIGEA law, which might be a challenge to the Wire Act. David Rebuck’s goals are beyond optimistic. To a person who’s seen the US gambling landscape shift against operators, affiliates, and players in the past 10 yeas, it is an astounding game plan.
New Jersey has been disappointed many times before. Nothing has been gained until a federal court agrees with New Jersey, and those who have followed the story have grown accustomed to seeing the sports leagues win these arguments. But a decision coming soon in Philadelphia could change all the logic on which the American online gambling industry has stood these past 10 years.
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