Another Florida sports betting lawsuit has kept the attorneys of West Flagler Associates busy this week.
The south Florida-based operators of Magic City Casino and Bonita Springs Poker Room filed a lawsuit in the U.S. District Court for the District of Columbia against Secretary of the Interior Deb Haaland and her agency itself in an effort to block the FL sports betting compact entered into between Governor Ron DeSantis and the Seminole Tribe.
The law firm also amended its complaint in the Northern District of Florida against DeSantis and Julie Imanuel Brown, the Secretary of the Florida Department of Business and Professional Regulation. They added a fourth argument as to why the 2021 compact and its implementing law are ultra vires to the Governor’s powers, this time adding an argument that the compact violates the Fourteenth Amendment.
What’s in amended Florida sports betting complaint?
The amended complaint supersedes the complaint filed July 2. The new complaint adds an additional reason as to why the Northern District of Florida Federal Court should issue an injunction stopping the compact from coming into effect.
Adding to the original three arguments that the compact is outside the Governor’s hands because:
- It allegedly violates the Indian Gaming Regulatory Act (IGRA)
- It allegedly violates the Wire Act
- The compact allegedly violates the Unlawful Internet Gambling Enforcement Act (UIGEA)
The South Florida gaming operator is arguing that the compact violates the Fourteenth Amendment:
because they purport to allow a race-based and tribe-based disparate treatment of gaming operations by granting a state-wide monopoly to offer gaming via the internet to the Tribe in violation of the Equal Protection Clause.
The Fourteenth Amendment argument
The Fourteenth Amendment argument, is, well, creative. The argument begins by noting that the Seminole Tribe and West Flagler Associates have been competitors for a number of years competing for slots players and for banked card game players. The South Florida pari-mutuel operator argues that a monopolistic grant of Florida sports betting to the Seminole Tribe would be devastating for their business that relies on foot traffic.
West Flagler states:
Moreover, this expansion to a state-wide monopoly violates the Equal Protection Clause of the Fourteenth Amendment by according disparate treatment of gaming operations on the basis of race, tribal affiliation, and national origin.
What does West Flagler Associates want?
West Flagler Associates is seeking a declaratory judgment on the Fourteenth Amendment claim (like their previous three claims) and asking that the Northern District of Florida Court impose an injunction.
West Flagler argues:
Under the Equal Protection Clause of the Fourteenth Amendment, discrimination based on race, tribal affiliation, and national origin is presumptively unconstitutional and subject to strict scrutiny.
It continues:
The online sports betting provisions of the 2021 Compact establish different treatment for gaming facilities on the basis of the race, tribal affiliation, and national origin of their owners.
The Fourteenth Amendment claim is a Hail Mary from a team’s own one-inch line. But it could effectively undo the entirety of the tribal gaming system across the country if West Flagler Associates were to have a Doug Flutie moment.
Meanwhile up in Washington D.C. …
As West Flagler Associates’s lawyers were busy filing their amended complaint in North Florida, the company was filing suit in the District of Columbia against the Secretary of the Interior and the executive agency itself.
The complaint argues that the 2021 Compact is impermissible for three reasons.
- First, it “unlawfully permits the Tribe to operate gaming outside of its own reservations, which is not permitted by IGRA.”
- Second, the Compact is not compliant with the Wire Act and UIGEA
- Finally, the Compact “violates the Fifth Amendment’s guarantee of equal protection by granting the Tribe a statewide monopoly over internet sports gambling throughout Florida even as it remains a serious criminal offense for anyone else to offer it anywhere in Florida.”
(As an aside for non-lawyer readers, while the Constitution’s Fifth Amendment makes no mention of equal protection, unlike the Fourteenth Amendment, the Supreme Court has long incorporated equal protection into the Fifth Amendment’s due-process clause.)
In addition to the arguments that the law violates various federal laws, the gaming magnates argue that the expansion of Florida sports betting to the Seminole Tribe violates the Florida Constitution because the gaming expansion was not approved by voters.
More of the same?
There is significant overlap between the amended complaint filed in the Northern District of Florida and the complaint filed in the District of Columbia. But there are a few unique items as well.
West Flagler Associates argues that sports betting remains illegal in Florida and that the only way to offer sports betting is via a constitutional amendment. Interestingly, West Flagler Associates suggests that IGRA required Haaland to affirmatively disapprove a compact that was contrary to federal law.
t is worth noting that the compact is approved only to the extent that it complies with federal law by the terms of Interior’s inaction, so it is not immediately clear as to why Haaland did not satisfy her obligations, as any portion of the compact that violates federal law is not approved.
Harm to the plaintiffs through Florida sports betting?
The plaintiffs detail that the approval of the compacts would cause them substantial economic harm. This seems likely, as a monopoly on Florida sports betting would at minimum mean that West Flagler Associates would lose out on the revenue from operating a sportsbook. But they also argue that mobile FL sports betting will likely result in people just staying home to bet, so they might even see existing customers stay home.
It seems clear that the plaintiffs will suffer harm if the compact is approved. However, their standing to raise this issue in the D.C. District Court against the Secretary of the Interior and the DOI is likely to be challenged.
Breaking down the claims
The plaintiffs argue in their first count that Haaland had a legal responsibility to act and disapprove the compact under the Administrative Procedures Act. In their second count, the plaintiffs argue that the compact violates the plaintiffs Fifth Amendment equal protection rights, stating:
In granting a state-wide, race-based monopoly to the Tribe, the Compact precludes Plaintiffs from competing with the Tribe even within their own parimutuel facilities in offering sports wagering and online sports wagering.
The plaintiffs advocate that there is no “compelling, legitimate, or rational government interest that could justify this race-based and tribe-based disparate treatment of gaming operations.” The government will likely rebut this by citing the very reasons for enacting IGRA.
However, we are likely at least eight weeks from the answer to this complaint.
What’s next in Florida sports betting suits?
While the D.C. case is just getting going, the Northern District of Florida case is going to see its next action on August 31. That is when the governor’s answer to the complaint is due. How the governor’s office responds should provide a good roadmap for what the most contentious areas of the lawsuit are likely to be.
One fun tidbit about the D.C. suit is that West Flagler Associates have hired longtime DraftKings law firm Boies Schiller Flexner to represent them.
If one of these two lawsuits is to be the one to watch, I would put my money on the Northern District of Florida suit.
