Florida OSB moves a step closer
The US Court of Appeals ruling could open the way for agreement of the new compact.
Good morning. Today we bring you a News Extra on the events late last week as the US Court of Appeals in Washington gave the legal green light to the agreement between the state of Florida and the Seminole tribe, which could pave the way for OSB.
Blow, blow Seminole wind, blow like you're never gonna blow again.
Florida, man
A seismic federal court ruling in favor of the Seminole Tribe of Florida has opened the door for sports betting in the state.
On Friday, the US Court of Appeals in Washington, DC, tossed out a lower court ruling that had halted a $2.5bn agreement between the state and the Seminole which briefly saw gambling on phones and computers within the state’s borders in 2021.
Two non-tribal casino owners in Florida – Magic City Casino and the Bonita Springs Poker Room – challenged the pact, arguing it breached the Indian Gaming Regulatory Act (IGRA).
However, Judge Robert Wilkins in West Flagler Associates, Ltd. v. Haaland said the compact did not violate the IGRA because it only handled gambling on tribal lands, not outside.
The 24-page ruling “will have meaningful implications for the future of online sports betting in Florida along with the interpretation of the IGRA”, said Abbey Block, associate at Ifrah Law.
“Indeed, perhaps other states will take note and utilize similar language in their own… gaming compacts,” Block said.
How did we get here: In April 2021, Florida Gov. Ron DeSantis and the Seminole tribe agreed to a 30-year deal, called a ‘compact’. The tribe would be authorized to operate sports betting, and offer craps and roulette at its casinos.
To circumvent a 2018 Florida constitutional amendment, the agreement required the tribe to operate a hub-and-spoke model for sports betting, which routes all online sports bets from players located in Florida but outside of tribal lands through the tribe’s servers.
In return for agreeing to the compact, the state would get at least $2.5bn over the first five years and an estimated $20bn over the 30 years of the deal.
The U.S. Department of the Interior, overseer of American Indian Affairs, waved the deal through under the IGRA.
Do you believe in magic: Non-tribal operators, led by West Flagler Associates, which owns Magic City Casino in Miami, sued in federal court, arguing Interior Secretary Debra Haaland should have stopped the compact as a violation of the IGRA.
Wilkins, however, said the IGRA, written in the 1980s and now cracking due to advances in online wagering, was pliable enough to allow for Florida’s arrangement.
“Whether it is otherwise lawful for a patron to place bets from non-tribal land within Florida may be a question for that state’s courts, but it is not the subject of this litigation and not for us to decide,” Wilkins said.
However, the judge added that whether the compact violated state law was a matter for the Florida courts to decide, meaning the case isn’t quite done.
The deadline for filing a petition for rehearing is August 15.
Brand new start: The Seminole tribe was understandably delighted with the unanimous ruling. “It is a positive outcome for the Seminole tribe and the people of Florida, and for all Indian Country. The tribe is fully reviewing the decision to determine next steps,” it said in a statement.
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Back from the dead
The tribe’s Hard Rock Sportsbook was quick to offer its own take:
What happens next: Online sports wagering in Florida could explode if the Seminoles revive their Hard Rock Sportsbook betting app, which was torpedoed by the West Flagler suit, and press ahead with two new casinos in South Florida.
"I can see best-case scenario, the Seminoles relaunching their sportsbook in the second quarter of 2024,” said Daniel Wallach, South Florida lecturer and sports-betting attorney.
Wallach and other experts believe there are more twists to come in the case as other opponents submit legal challenges.
“We all know that West Flagler, which is the main plaintiff, is going to be litigating this case all the way to the Supreme Court,” Wallach told WPEC.
“That would automatically stay everything, until that process concludes, and the U.S. Supreme Court aspect of the case will probably extend the stay in this case until all federal judicial proceedings wrap up.”
“But, there’s a possibility that online sports betting can come back to Florida by the end of this year.”
The Big One: “Florida could be open for sports betting in time for this year’s NFL season,” said Jeff Ifrah, founder of Ifrah Law, noting the start of the NFL is on everyone’s mind.
A partner in KPMG’s US leisure team speaking anonymously told C+M he expected the Seminoles to move quickly, given the timing of the decision.
“If they get this up and running by football season; boom, NFL, the only game in town,” the partner said.
Nearly every sportsbook will be engineering a way to obtain a Florida license, they added, noting that DraftKings and Caesars already had horseracing operations in the state.
Also cheering will be one former President, as the pact allows the Trump National Doral resort and the Fontainebleau Miami Beach hotel to obtain casino permits without violating the tribe’s monopoly status.
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