Federal court backs Seminoles' mobile sports betting, could change gaming landscape in America
A federal appeals court sided with the Seminole Tribe in its appeal of a lower court decision. The decision found that the tribe’s Class III gaming agreement with the state of Florida violated the federal Indian Gaming Regulatory Act (IGRA).
The Seminole tribe has a monopoly on table games in Florida's Las Vegas-style casinos. The tribe owns and operates six land-based casinos in the Sunshine State, highlighted by the Seminole Hard Rock Hotel & Casino in Hollywood and the Seminole Hard Rock Hotel & Casino in Tampa.
In April 2021, the tribe signed a new 30-year agreement with Florida Gov. Ron DeSantis (R), giving the tribe exclusive online sports betting rights. The agreement also allows the Seminoles to add roulette and craps games to their casinos in exchange for paying at least $2.5 billion over the first five years of the agreement.
The Florida Legislature subsequently approved the revenue sharing and gambling expansion agreement.
But a provision that allowed tribes to accept bets over the Internet led to lawsuits. The lawsuit comes from West Flagler Associates, which at the time owned Miami's Magic City Casino and Bonita Springs Poker Room. The company later sold Magic City but kept Card Club.
Lawyers for West Flagler argue that Florida’s decision to allow the tribe to accept sports betting over the Internet violates the Indian Gaming Regulatory Act (IGRA). The company named the Interior Department as a defendant because its Bureau of Indian Affairs approved the deal.
Federal Judge Dabney Friedrich of the District Court in Washington agreed with the plaintiffs in a November 2021 ruling, invalidating the contract and halting the tribe's sports betting operations. Just a few weeks ago, the Seminoles launched their Hard Rock Sportsbook app.
IGRA court ruling allows online betting
The Seminoles appealed Friedrich's ruling to the U.S. Court of Appeals for the District of Columbia Circuit.
At the heart of the issue is the Indian Gaming Regulatory Act (IGRA), the federal law that allows tribes to operate Class I and Class II games — defined as bingo, pull-tab, etc., as well as undeposited cards played on bank accounts — on their sovereign lands. IGRA also allows states to enter into Class III gaming treaties with federally recognized tribes. The third category of games includes slot machines, bank table games such as blackjack, and sports betting.
Friedrich ruled that the IGRA only allows states to enter into Class III gaming contracts that take place on sovereign lands. Since the Seminole-DeSantis Treaty allows sports betting over the Internet, states and tribes have attempted to circumvent this requirement by claiming that the sports betting computer servers are located within Seminole territory and therefore do not violate the law.
A three-judge appeals court ruled unanimously Friday that the IGRA would not prevent the Seminoles from accepting sports bets remotely.
IGRA does not prohibit gaming treaties (agreements between tribes and states) from discussing other issues, including regulating activities “outside Indian territory,” the court said in its ruling on page 24.“Indeed, IGRA specifically provides that a contract ‘may’ do so if the activity is ‘directly related’ to gambling.”
"The compact itself only authorized gambling on tribal lands; in that regard, it complied with the provisions of IGRA," the ruling continued. "Whether it is legal for customers to bet on non-tribal lands in Florida may be a question for that state's courts, but that is not the subject of this lawsuit and is not our decision."
DeSantis spokesman Jason Mahon said the state will continue to work with the Seminole Tribe "to ensure the success of this historic agreement." When the agreement is signed in 2021, state fiscal projections predict the state will receive more than $20 billion in tribal gaming revenue over the life of the 30-year agreement.
IGRA may face challenges
Although the Seminole Treaty is considered legal, at least for now, and the tribe is legally allowed to reopen its online sports betting, West Flagler will likely move to a full all-conference meeting. Request a hearing before the Court of Appeal. If the court refuses, the company's ultimate recourse would be the U.S. Supreme Court.
Tribal legal experts said the ruling could lead tribes across the country that have Class III gambling contracts with sportsbooks to seek online sports betting privileges from their governors. This could lead to a challenge by IGRA and possible proceedings before the Supreme Court.
Gambling attorney Daniel Wallach said this may not be the end yet. Tribes may also seek iGaming rights through their Class III contracts, since a federal appeals court ruled that IGRA does not expressly prohibit the promotion of remote wagering. This will dramatically change the national gambling landscape because it will serve as a blueprint for online sports betting and internet gambling across the country," Wallach told the Miami Herald."They will be able to control the most profitable businesses across the country. form of gambling – which would harm the interests of non-tribal gambling operators. "
“This has sparked debate in the U.S. Supreme Court over the breadth and scope of IGRA,” Wallach concluded.
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Source: www.casino.org
