When it comes to sports betting, the NFL is still trying to get its legs underneath it.
As the NBA embarks upon the maiden partnership between a league and a casino company, the NFL remains uncertain about fantasy sports, let alone betting. The largest league in the US isn’t quite up to speed with the country’s emerging industry just yet.
The issue is about to come to a head, with the Oakland Raiders set to relocate to Las Vegas in 2020. People soon will be wagering on games from inside the team’s $1.8 billion stadium, a gorgeous 65,000-seat venue under construction now.
On one hand, NFL owners embraced the idea of moving a franchise to the sports betting capital of the world. On the other, an ongoing court case in Texas raises further questions about the NFL’s stance on the business of gambling.
Backstory on the case
This Texas situation began in 2015, when a company called Fan Expo scheduled its inaugural National Fantasy Football Convention (NFFC). The three-day event planned to bring folks from fantasy football and real-life football together in Las Vegas.
Here’s how Fan Expo described the convention in its court filing:
The NFFC experience was designed to give NFL fans the chance to meet current and former NFL stars, as well as media personalities and football experts, live and in person through keynotes, panel discussions, question-and-answer sessions, autograph opportunities, photo ops, games, exhibits, and drafts.
Nearly 100 players planned to appear, including Odell Beckham Jr., Rob Gronkowski, and Tony Romo, who has a stake in the company. The league itself was apparently on board, too, agreeing to let analyst Michael Fabiano serve as the co-host.
Five weeks before the event, however, “the NFL had an abrupt change of heart,” according to the filing. The league informed personnel that attendance could be in violation of its policies on gambling associations.
To make a long story short, organizers pulled the plug on the event and sued the NFL for damages. Lower courts decided in the league’s favor, and Fan Expo is in the process of appealing at the highest level.
The case is pending consideration by the Texas Supreme Court.
NFL policy on ‘gambling associations’
The Fan Expo case centers around the NFL’s gambling policies and how the league applied them in this instance.
In its most recent filing, the NFL cites that policy in full. Some of the items laid out are obvious. League personnel may not accept bribes or fix games, nor may they share confidential information. The policy prohibits betting on all sports and even visiting a sportsbook during the NFL season.
But the league also dictates how personnel should handle “gambling associations.” Here’s what’s prohibited:
- Promoting a casino, sportsbook, or tout service
- Participating in promotional events held at or sponsored by a casino
- Accepting comps from a casino
Fan Expo argued unsuccessfully that the league misapplied that second policy point. The NFFC was to be held at the Sands Expo convention center, which is attached to The Venetian and owned by the same casino company.
“The convention facility is not licensed for gambling and is not part of a casino,” Fan Expo tried in its initial filing. It called the NFL’s gambling policy “ambiguous at best.”
Some careful marketing may have avoided the problem altogether, but the company did make a seemingly fatal error in advertising Venetian as the host venue. According to the NFL, promoting an event at a casino would have put attending personnel in clear violation of the policy. It was, it argued, within its legal right to inform them of the potential violation.
The courts have sided with the the league so far.
NFL’s gambling policy in flux?
The gambling section of the NFL policy book has been in flux recently.
A prohibition against playing daily fantasy football, for example, appears to have been removed this year. It also looks like that casino comp policy has changed, if this tweet from a former player is accurate:
What’s more, a committee of NFL owners recently decided to allow teams to partner directly with casino companies, even those which offer sports betting. According to Bill King of Sports Business Daily, the committee “agreed to relax league rules prohibiting sportsbook-connected sponsorship.”
These policy updates seem to indicate a growing acceptance of sports betting — at least by owners if not by the league itself. Still, it’s not entirely clear how far those permissions extend. It’s players, not teams, that are at the root of the Fan Expo case, and the relevant player policy apparently remains unchanged.
Meanwhile, according to the filing:
- New Orleans Saints hosted training camp at The Greenbrier in West Virginia in 2014.
- Detroit Lions have a marketing partnership with MGM Grand.
- Fifteen teams partnered with FanDuel in 2015.
- NFL has a long-standing partnership with Carnival Cruise Lines, which operates casinos on board.
As King put it, “some NFL teams have found nuanced ways to conduct business with casinos in recent years.”
NFL needs a firm stance
In response to Sen. Chuck Schumer’s recent call for sports betting legislation, the NFL told Congress that “core federal standards are critical to safeguarding the sports we love.”
Its own standards on gambling, however, are still underdeveloped. The NFL is straddling the invisible fence, not quite ready to open its arms to the betting industry.
On one side, you have team owners like David Tepper of the Carolina Panthers, whose hedge fund has stakes in Caesars, MGM and Boyd Gaming. All three companies, of course, offer sports betting. League policy does not preclude team executives from having casino interests provided they’re not involved in operations, and the NFL vetted Tepper’s business to its satisfaction.
If Tepper wanted, he could partner his team with one of his casino investitures. The updates King cited allow teams to accept money from casinos and fantasy sports sites, even those involved in sports betting. Both FanDuel Sportsbook and DraftKings Sportsbook figure to be prime candidates for sponsorship nowadays, much as their parent companies were a few years ago.
On the other side, you have superstar athletes like Beckham who aren’t even allowed to attend promotional events at a casino. If, for example, FanDuel wanted to sponsor his New York Giants, it could. But OBJ wouldn’t be permitted to appear in marketing materials or promote the product at The Meadowlands.
Fan Expo might not have good grounds for its lawsuit, but its principal argument is still valid. The NFL needs to offer a clear and public stance regarding gambling associations.