The US Supreme Court’s ruling in the New Jersey sports betting case will be the most consequential sports betting legal decision ever.
Unless the ruling never comes to fruition.
Enter the concept of ‘mootness’ — a legal principle grounded in the US Constitution — where yet-to-be-decided cases are kicked out of court prior to a conclusive decision because of some intervening event that renders the original controversy a nullity.
Could that happen in the long-awaited NCAA, NBA, NFL, NHL & MLB v. Governor of New Jersey lawsuit?
Only a tiny number of Supreme Court cases, if any, are deemed moot each year, but a recent event has brought the possibility into the forefront as SCOTUS continues to deliberate the fate of the partial sports betting ban contained in the Professional and Amateur Sports Protection Act (PASPA) and New Jersey’s defense of the PASPA lawsuit brought by the five leagues in 2014.
Inching toward mootness
Earlier this month, Major League Baseball in-house lawyer Bryan Seeley told a committee of Missouri lawmakers that sports betting could result in “more engagement” and “more sponsorships” for his employer.
“There is the opportunity for MLB to profit on this,” said Seeley.
The full Missouri hearing can be viewed here.
Seeley’s acknowledgement — during a formal government hearing in which he was lobbying in favor of certain provisions to be included in draft legislation permitting sports wagering — runs counter to the original lawsuit MLB and the four other sports leagues filed on October 20, 2014, against then-Gov. Chris Christie.
In 2014, Major League Baseball, as well as the NCAA, NBA, NFL, and NHL, jointly alleged that they would suffer “irreparable injury [if] defendants or anyone else begin sponsoring, operating, advertising, promoting, licensing, or authorizing sports gambling.”
Whether a plaintiff who initiates a PASPA lawsuit alleging “irreparable injury” can subsequently posit mid-litigation that the same activity — sports betting—could result in increased consumer engagement and profit is attention-grabbing.
Such contrasting arguments could also have profound legal consequences, as a significant change in position by a litigant in an ongoing Supreme Court case is one of a handful of instances that can trigger a suggestion of mootness. Indeed, Major League Baseball and the NBA are lobbying in multiple states for sports betting bills that would only be activated if the sports leagues lose the Supreme Court case and PASPA falls by the wayside, a notable stance given that the five sports leagues who sued New Jersey are arguing in support of PASPA before SCOTUS.
A hedge like that is revealing on its own, but such ‘in-the-alternative’ positions could also result in a mootness inquiry.
If a case is deemed moot, the entire lawsuit is dismissed and the trial court judgment — namely the injunction preventing New Jersey from permitting sports betting under its 2014 “partial repeal” legislation — could be vacated.
What would the result of that be?
The court order barring sports betting in New Jersey would be lifted. Immediately.
Why did the five sports leagues claim to be injured?
To get a toehold in federal court, a plaintiff has to be injured in some way. If a plaintiff — or group of five plaintiffs as in the current sports betting case — has no injury, the courtroom doors are closed.
The injury requirement stems from the legal concept of ‘standing,’ a contentious issue during the first installment of the New Jersey case back in 2012.
The NFL has specifically recognized the importance of the standing requirement in federal litigation.
“[E]ach ‘plaintiff must demonstrate standing for each claim he seeks to press and for each form of relief that is sought,’” wrote NFL lawyers last year in an unrelated case stemming from the league’s suspension of Dallas Cowboys running back Ezekiel Elliott.
The mandate that plaintiffs be injured is not measured at a single point in time during the early stages of a lawsuit. The precondition continues throughout the pendency of a case.
“[T]he proof required to establish standing increases as the suit proceeds,” wrote the Supreme Court in a 2008 case.
Legal injuries and standing in a nutshell
Here is what is required:
“To qualify for standing, a claimant must present an injury that is concrete, particularized, and actual or imminent; fairly traceable to the defendant’s challenged behavior; and likely to be redressed by a favorable ruling,” wrote the Supreme Court in the same decision a decade ago.
In a different case, Chief Justice John Roberts stressed that the Constitution “does not give federal courts the power to order relief to any uninjured plaintiff.”
These requirements shaped the legal arguments the five sports leagues made in their complaint that started the lawsuit now pending before SCOTUS.
“[T]he spread of state-sponsored sports gambling in New Jersey would irreparably harm plaintiffs,” wrote lawyers for the NCAA, NHL, NFL, NBA, and Major League Baseball in 2014. “[M]onetary damages would be inadequate to compensate plaintiffs for the irreparable injuries they will suffer.”
Both Major League Baseball and the NBA are now actively lobbying in support of new state laws that require sportsbooks to pay individual sports leagues a narrowly-tailored “fee” equal to one percent of handle.
A quick look at ‘mootness’
Article III of the U.S. Constitution only allows federal courts to adjudicate “cases” and “controversies” between plaintiffs and defendants involved in a live dispute. Federal courts are barred from issuing so-called ‘advisory opinions.’
“The rule in federal cases is that an actual controversy must be extant at all stages of review, not merely at the time the complaint is filed,” concluded the Supreme Court in a 1975 case.
And when does the Supreme Court slap the ‘mootness’ label on a case?
Two different Supreme Court decisions helped to set the parameters.
Cases become moot when “the issues presented are no longer live or the parties lack a legally cognizable interest in the outcome.” Likewise, “plaintiffs must maintain a personal stake in the outcome of the litigation throughout its course” or else mootness sets in.
Getting rid of SCOTUS cases
The Supreme Court has a mechanism to dump moot cases.
Supreme Court Rule 21 allows the parties to flag important changes, even after oral argument has taken place. Oral argument in the New Jersey sports betting case took place Dec. 4.
Rule 21 allows a “motion to dismiss as moot (or a suggestion of mootness)…the granting of which would dispose of the entire case.”
In a 1985 case, the Supreme Court wrote that litigants have a “continuing duty to inform the Court of any development which may conceivably affect the outcome” of a case.
A good example of mootness implicating an ongoing Supreme Court proceeding just happened.
In United States v. Microsoft — a case about the enforcement of a probable cause warrant attached to data stored overseas — both sides recently filed motions to the Supreme Court arguing in favor of mootness.
The Supreme Court is expected to rule on whether the United States v. Microsoft case is moot as early as this month.
Taking stock of ‘injuries’ from sports betting
When MLB’s Seeley told Missouri lawmakers that sports betting may result in profit and increased consumer engagement for MLB, his stance mirrored informal statements by other sports league executives.
In 2015, NBA executive Adam Silver said gambling is “good for business, I don’t want to hide from that” during a radio interview.
And last year, the NFL’s Roger Goodell described the existing Nevada sports betting regulatory apparatus as “beneficial” during a press conference.
What made Seeley’s position noteworthy — especially vis-à-vis the mootness doctrine — was the forum. Radio spots and media pressers differ substantively from a formal governmental hearing or court proceeding. Indeed, in written material submitted to various statehouses across the country, Major League Baseball and the NBA have not memorialized the increased consumer engagement and profit they may reap from sports betting.
At the same time, written materials submitted by both leagues have omitted any reference to “irreparable injuries” of the type alleged in the current Supreme Court case. Such silence followed shortly after the attorney representing the five leagues referred to sports betting as a “cancer” during the Dec. 4 oral argument before the Supreme Court.
Questioning from state lawmakers, however, has teased out evolving positions among some of the plaintiffs in the pending SCOTUS case.
Whether the shift will make any difference in the timing or substance of the Supreme Court’s ruling is to be determined.
To date, neither NJ Gov. Phil Murphy nor any of the other defendants in the case have filed a Rule 21 motion to suggest any potential mootness issue and there has been no indication that one or more of them are considering it.
But raising issues about mootness are never waived and Rule 21 filings may be made at any time prior a decision being released. The Supreme Court could also tackle the issue on its own, “even if the parties fail to raise the issue.”
The official Supreme Court docket was last updated in January, when the Court was notified about Murphy becoming governor of New Jersey.
