Analysis: West Flagler Kicks Florida Sports Betting Can Once More

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Florida sports betting

Late Monday, West Flagler Associates made their predictable and unsurprising filing at the D.C. Circuit Court of Appeals in their Florida sports betting case.

The South Florida gaming operators filed a petition asking for a rehearing en banc, meaning a hearing before the entirety of the D.C. Circuit Court of Appeals. The petition faces very long odds, as not only are en banc hearings rarely granted, but West Flagler failed to convince a single one of its three-judge panel that they were correct.

Assuming those three judges oppose rehearing, that would mean they would need to convince six of the remaining eight D.C. Circuit Court of Appeals judges to hear the case. That is not impossible, but definitely rare.

In the interim, this likely pushes back the launch of mobile FL sports betting, as the Clerk’s Order that accompanied the Court of Appeals decision said that operations could not restart until seven days after the disposition of any petition.

Florida sports betting case to date

Following the 2021 compact signed between Gov. Ron DeSantis and the Seminole Tribe of Florida, there were a number of challenges to the plan to roll out Florida sports betting with the Seminole Tribe (and their Hard Rock Sportsbook brand) as the monopolists. Efforts by the Florida Education Champions, a lobbying group backed by DraftKings and FanDuel, to put the question to voters was defeated, as was an effort by West Flagler Associates to sue DeSantis in federal court and argue that his signing the Compact was an ultra vires act.

However, one effort was successful: West Flagler sued the Department of the Interior and argued that the Secretary of the Interior had an affirmative obligation to reject the 2021 compact because it violated the Indian Gaming Regulatory Act (IGRA.) The District Court agreed, but the Court of Appeals reversed the lower court’s decision articulating that the compact did not authorize mobile wagering; instead, it merely discussed mobile wagering but the authorization of the activity was a legislative act separate from the compact.

The argument of the Court of Appeals was that if there is something improper with the law allowing mobile sports betting in Florida, that is a question for state courts, not federal courts.

Baby, can we try one more time?

West Flagler has very little to lose asking for a rehearing (I mean, assuming you do not count money.) Even though the odds of success may be long, arguing for a rehearing is a natural step.

In its appeal the South Florida gaming operators raise three key arguments as to why the entirety of the Circuit should rehear the case:

Important question about the scope of IGRA

The first argument raised in the petition is that the 2021 compact does, in fact, authorize gambling off of “Indian lands,” and therefore is not compatible with IGRA. IGRA unambiguously dictates that it only addresses gaming that takes place on Indian lands.

he petition argues that the “deeming” of servers to be the location of where a bet takes place in order to bring it within IGRA is an end-run around to allow online betting through the compact.

In making its first argument, the South Florida operators argue that the Court of Appeals gets IGRA’s history wrong. The petition argues that IGRA was passed to “balance state, federal, and tribal interests:”

There is no plausible way to read IGRA as a one-sided protection of tribal gaming against state regulation….

The not-new Equal Protection argument

The second argument raised for the consideration of the panel is the argument that there is an Equal Protection Clause question that requires an answer. This question played prominently in the Maverick Gaming case across the country in Washington, though ultimately it was not addressed, as the Shoalwater Bay Tribe’s motion to dismiss was granted.

The argument essentially centers on whether the monopoly afforded to the Seminole Tribe of Florida that results in the different application of criminal law on and off tribal lands constitutes a violation of the Equal Protection Clause. In a number of past cases challenging various statutes that afford a benefit to Native Americans, courts have been incredibly reluctant to strike these down on Equal Protection grounds, often applying a low level of scrutiny to the analysis.

Is this a violation?

West Flagler’s final argument is that the Secretary of the Interior cannot ignore violations of federal law when reviewing a Compact.

Therefore, the Secretary must affirmatively reject violative compacts, as opposed to allowing them to come into effect either explicitly or through in action.

What to make of Florida sports betting filing

We knew this was coming and there is not a whole lot here that is unexpected. While some on Twitter speculated that West Flagler would go straight to state court or give up, those with knowledge of the case almost universally expected the South Florida gaming operators to play out all their options in federal court before looking for alternative vehicles in state court.

There is not typically a response brief to en banc petitions, though in theory, anything could happen. It seems likely that we end up with a decision in relatively short order on the petition, though it is possible that the Court of Appeals takes a little while.

If a rehearing is granted, sports betting in Florida has the pause button pressed again. If, as is most likely the case, the petition is rejected, in theory, sports betting could be up and running seven days after the decision is issued.

West Flagler could then petition the Supreme Court and while it would be possible that the Supreme Court issued an injunction stopping sports betting while it considered the petition, that would be unlikely. As it stands, the D.C. Circuit Court of Appeals is on the clock.