- Sports Betting
- US Betting
- Daily Fantasy Sports
- LSR Podcast
The brief from attorney Paul Clement — representing the NCAA, NFL, NBA, NHL and Major League Baseball — pushes back against the idea that federal law “commandeers” states to act on sports betting.
Here is the crux of the leagues’ argument from today’s brief regarding PASPA, the federal law banning sports betting outside of Nevada:
PASPA lacks the irreducible minimum of any successful commandeering claim: It does not compel states or state officials to do anything. States are not required to enact laws, to take title to something, to conduct background checks, to consider federal standards, to expend funds, or to enforce federal law. Proving the point, New Jersey fully complied with PASPA for two decades without doing anything.
That is because PASPA only prohibits states from sponsoring, operating, advertising, or promoting sports-gambling schemes, and prohibits states from licensing or authorizing third parties to engage in that conduct. PASPA does not force states to take any affirmative action to comply with those prohibitions.
Thus, while petitioners portray PASPA as an anomalous effort to enlist states to do the federal government’s bidding, the reality is that PASPA is an unremarkable effort to preclude states from engaging in certain conduct and to preempt state laws that license or authorize others to do the same.
But Congress does not commandeer the states just because it limits their policy options, and nothing in the Tenth Amendment prevents Congress from using its commerce power to preempt state laws that contravene federal policy.
The difference between permissible preemption and impermissible commandeering is that the former precludes certain state action, while the latter commands it. PASPA falls comfortably in the former, permissible camp.
The state of New Jersey has argued in the case that PASPA is unconstitutional, saying it commandeers states to carry out the federal prohibition. New Jersey’s sports betting law at issue in the case amounts to a partial repeal of its spots betting law, allowing sports betting to take place at casinos and race tracks.
You can read the entire 71-page brief here.
The leagues’ filing makes the issue at hand much about the constitution’s “Supremacy Clause,” right from the first sentence: “This case involves a straightforward application of the Supremacy Clause…The Professional and Amateur Sports Protection Act (‘PASPA’) does not force states to enact any federally-prescribed legislation or to enforce any federal regulatory regime.”
The New Jersey filing, meanwhile, did not spend much time on the issue, saying the “Supremacy Clause does not provide ‘any authority on the part of Congress to mandate state regulation.’ ” There are no less than a dozen mentions in the NCAA’s brief.
What’s the clause in question? Its the foundation of the constitution, that federal laws made under the constitution are the supreme law of the land.
The case therefore appears to hinge on whether the Supreme Court buys the argument that PASPA is forcing New Jersey to act in the federal government’s interests or not. Here is the crux of NJ’s argument made last month to SCOTUS:
PASPA compels States to regulate—indeed, prohibit—sports wagering and therefore exceeds Congress’s authority.
The NCAA brief replies, meanwhile:
States are not required to enact laws, to take title to something, to conduct background checks, to consider federal standards, to expend funds, or to enforce federal law. Proving the point, New Jersey fully complied with PASPA for two decades without doing anything.
The leagues have generally argued that they suffer “harm” from sports betting in myriad ways. That argument is lacking in substance in the leagues’ brief this time around, however.
Any potential of “harm” or “injuries” suffered by the leagues is certainly downplayed here. The only two mentions come in factual terms.
Congress has long recognized and sought to contain the harms that can flow from various forms of gambling. In doing so, Congress has often deferred to state judgments as to what types of gambling should be allowed in that state, but it has intervened when necessary to “prevent interference by one State with the gambling policies of another” and “to protect identifiable national interests.” 15 U.S.C. §3001(a)(2).
That’s a different tune than the leagues have sung previously on the issue of harm, and certainly notable.
Both sides agree on this, it appears: New Jersey could fully repeal its prohibition and be within federal law, as currently written. That’s the so-called “nuclear” option that has been bandied about for some time.
Such a repeal would mean totally unregulated sports betting that could be carried out my anyone, in theory, outside of gaming facilities in the state.
That would certainly be a nightmare for the NCAA and the leagues. But Clement and the leagues more or less dares the state to take that option:
The state could repeal the entirety of its laws prohibiting or authorizing lotteries without running afoul of federal law.
But as respondents have conceded time and again, and the Third Circuit concluded as well, if New Jersey wants to fully repeal its prohibitions on sports gambling, it can do so without running afoul of PASPA’s prohibition on “authorizing” sports-gambling schemes.
Still, such a move is fraught with danger for New Jersey politicians and seems unlikely. Still, a full repeal would likely precipitate a quick change from the leagues’ stance on sports betting.
Oral arguments will take place in the nation’s highest court on Dec. 4.
The court will then consider the arguments, briefs and the law in play. A decision would likely come sometime in the first half of 2018. A wide range of outcomes are possible in the case. Those include PASPA staying on the books and NJ being unable to offer sports wagering, to striking the law down in whole or in part on constitutional grounds.
The latter scenario could open up the possibility of other states being able to legalize sports betting.
Meanwhile, two New Jersey Congressmen have asked for hearings on the issue.