06 Jul 2018 U.S. Supreme Court Legalizes Sports Betting and Opens Door to Future Anticommandeering Challenges
The United States Supreme Court recently issued a ruling which overturned a federal law that prohibited most state legislatures from enacting sports betting laws. The case is seen as a boon for the gambling industry and state coffers because it provides a legal avenue for the estimated $150 billion a year in illegal sports betting. In addition, the opinion opens the door to future challenges based on state’s rights.
The case goes back to 1992 when Congress passed the Professional and Amateur Sports Protection Act (“PASPA”). Interestingly, it was spearheaded by then Senator Bill Bradley of New Jersey. Bradley, a former college athlete, viewed gambling and sports as a dangerous mix which would ruin the integrity of athletic competition and create fertile grounds for match fixing. Since then, voters in New Jersey passed a state constitutional amendment in favor of legalized sports betting in 2011, repealed laws against sports betting three years later, and challenged PASPA in court as violating the U.S. Constitution.
PASPA prevented most state legislatures from creating or implementing laws authorizing sports gambling. Nevada was allowed an exception under the law because it already had legal sports gambling in its many casinos. New Jersey, which operated licensed casino gaming as well, was granted a one-year exception to pass laws permitting sports betting. After failing to enact laws to legalize sports betting within the one-year window, sports betting was illegal in New Jersey.
Fast Forward to Today
The cultural and political climate is different today when compared to 1992. States have been eager to increase their revenue streams by taxing what was previously unthinkable industries like legalized sports betting and marijuana. Supporters of legalized sports betting claim that regulated betting will empower law enforcement to fight illegal gambling and preserve the integrity of athletic competitions.
The Court’s recent ruling paved the way for states to do just that. In its opinion, the Court relied on the “anticommandeering” principle. This principle prevents the federal government from forcing states to take some action that the state would not otherwise take. Anticommandeering relies heavily on the 10th Amendment to the U.S. Constitution, which states that any roles not delegated to the federal government in the Constitution are reserved to the states, or people. The principle itself is also based on the federalist model of government, where the state and federal government are both seen as sovereign entities of equal status.
Gates Open for Legal Challenges
Some commentators note that because the majority opinion relied on the doctrine that Congress can choose federal policies, but cannot dictate to states what their own policies must be, the gates may have opened for additional challenges to federal law and policies. Examples include federal efforts to require states to use police to cooperate with federal initiatives like immigration or marijuana enforcement. The ruling may provide additional substance for states to oppose the federal government where federal policies conflict with state interests.
As lawsuits and legal challenges mount, businesses in California should increasingly prepare to be able to respond to state laws on an individual level. In California, for example, the regulatory and legal schemes here are notoriously complex. This is one of the reasons your company needs the right legal team guiding it through the many state and federal laws that apply to it.
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