Supreme Court rules states can legalize sports bets
New Mexico Indian tribes with casinos could offer sports betting under their gaming agreements
The Supreme Court on Monday struck down a federal law that effectively banned commercial sports gambling in most states, boosting the prospect of such betting across the nation.
The case concerned New Jersey, but the court’s decision opened the door for other states that are eager to allow and tax sports gambling. Americans are estimated to annually place $150 billion in illegal wagers on sports, and many states seem interested in making such wagers legal and reaping tax revenues from them.
State officials and representatives of the casino industry greeted the ruling with something like glee.
“I am thrilled to see the Supreme Court finally side with New Jersey and strike down the arbitrary ban on sports betting imposed by Congress decades ago,” Gov. Phil Murphy said in a statement.
New Mexico Indian tribes with casinos could offer sports betting under their gaming agreements with the state.
In exchange for a share of slot machine revenues from tribal casinos, the state has agreed not to expand offreservation gambling beyond a state lottery, horse racing, slot machines at racetracks and veterans and fraternal clubs, and bingo and other fundraising activities by nonprofit organizations.
The American Gaming Association, a trade group that represents casinos, predicted that the ruling would generate revenue without endangering the integrity of sports competitions.
“Through smart, efficient regulation this new market will protect consumers, preserve the integrity of the games we love, empower law enforcement to fight illegal gambling, and generate new revenue for states, sporting bodies, broadcasters and many others,” the group said in a statement. Others were warier. “The court’s decision is monumental, with far-reaching implications for baseball players and the game we love,” Tony Clark, executive director of the Major League Baseball Players Association, said in a statement. “From complex intellectual property questions to the most basic issues of player safety, the realities of widespread sports betting must be addressed urgently and thoughtfully to avoid putting our sport’s integrity at risk as states proceed with legalization.”
Justice Samuel Alito, writing for the majority Monday, said there were good policy arguments on both sides about whether to legalize sports betting.
“Supporters argue that legalization will produce revenue for the states and critically weaken illegal sports betting operations, which are
Americans are estimated to annually place $150 billion in illegal wagers on sports, and many states seem interested in making such wagers legal and reaping tax revenues from them.
often run by organized crime,” he wrote. “Opponents contend that legalizing sports gambling will hook the young on gambling, encourage people of modest means to squander their savings and earnings, and corrupt professional and college sports.”
But the question for the Supreme Court, Alito wrote, was whether Congress had crossed a constitutional line in forcing states to do its bidding. Congress remained free to regulate sports gambling directly, he wrote, but it could not force states to do so.
Five justices agreed with every part of Alito’s opinion, and Stephen Breyer with most of it. Ruth Bader Ginsburg, joined by Sonia Sotomayor, dissented, saying the majority had ruled too broadly.
“The court wields an ax,” Ginsburg wrote, “instead of using a scalpel to trim the statute.”
The betting law, called the Professional and Amateur Sports Protection Act of 1992, prohibited states from authorizing sports gambling. Among its sponsors was Sen. Bill Bradley, D-N.J., a former college and professional basketball star. He said the law was needed to safeguard the integrity of sports.
The law exempted Nevada, where sports betting has long been legal, along with sports lotteries in Delaware, Montana and Oregon. Other states were given a year to opt in, but none acted in time.
In 2011, though, as casinos in Atlantic City were losing revenue, voters in New Jersey amended its state constitution to allow sports betting, and the state Legislature soon passed a law authorizing it. The four major sports leagues successfully challenged the state law as a violation of the federal one.
In 2014, the Legislature tried a new approach, partly repealing its existing bans on sports betting to allow it at racetracks and casinos. The leagues again sued and won.
The Supreme Court has said that the federal government may not commandeer state resources to achieve federal objectives. On the other hand, the court has said that the federal government may regulate all sorts of things directly and that federal laws preempt contrary state laws under the Constitution’s supremacy clause.
In Monday’s decision in the case, Murphy v. National Collegiate Athletic Association, No. 16-476, the court ruled that the 1992 law amounted to unconstitutional commandeering.
“The anti-commandeering doctrine may sound arcane,” Alito explained, “but it is simply the expression of a fundamental structural decision incorporated into the Constitution, i.e., the decision to withhold from Congress the power to issue orders directly to the states.”
The doctrine protects state sovereignty, he wrote, and the betting law had violated it.
“It is as if federal officers were installed in state legislative chambers and were armed with the authority to stop legislators from voting on any offending proposals,” he wrote. “A more direct affront to state sovereignty is not easy to imagine.”
The principles announced in Monday’s decision may have implications for other kinds of federal laws. When the case was argued in December, Sotomayor said some federal regulation of marijuana could be threatened by a ruling that allows sports betting.