Feds Launch Appeal of Ruling on Sports Betting

Feds Launch Appeal of Ruling on Sports Betting

News Service of Florida
News Service of Florida
January 22, 2022

By Dara Kam

TALLAHASSEE --- With the future of mobile sports betting in Florida at stake, the federal government this week took the first step in appealing a judge’s decision that scrapped a deal that gave the Seminole Tribe control over sports wagering in the state.

The U.S. Department of the Interior, which oversees tribal gambling, filed a notice Wednesday that it intends to appeal a ruling by Washington, D.C.-based U.S. District Judge Dabney Friedrich that invalidated a 30-year deal negotiated by Gov. Ron DeSantis and tribal leaders and ratified by state lawmakers in May. The federal agency faced a Saturday deadline to file a notice of appeal. As is typical, the notice did not provide details of arguments that will be made in the appeal.

The gambling deal, known as a compact, gave the Seminoles control over online sports betting throughout the state and allowed the tribe to add craps and roulette to its existing casino operations. Also, the Seminoles would be allowed to add three casinos on their property in Broward County.

In exchange, the tribe pledged to pay the state a minimum of $2.5 billion over the first five years and possibly billions of dollars more throughout the three-decade pact. The deal also added Florida to numerous states that have jumped into sports betting since a 2018 U.S. Supreme Court ruling that cleared the way for such wagering in New Jersey.

The “hub-and-spoke” sports-betting plan in Florida’s compact was designed to allow gamblers throughout the state to place bets online, with the bets run through computer servers on tribal property. The compact said bets made anywhere in Florida “using a mobile app or other electronic device, shall be deemed to be exclusively conducted by the tribe.”

Owners of Magic City Casino in Miami-Dade County and Bonita Springs Poker Room in Southwest Florida challenged the compact, alleging the sports-betting provision violated federal law and would have a “significant and potentially devastating” impact on their businesses. The Havenick family has owned the pari-mutuels for decades.

Friedrich on Nov. 22 ruled that the compact violated a federal law known as the Indian Gaming Regulatory Act, or IGRA, because betting would occur off tribal property. She invalidated the entire compact, finding that Interior Secretary Deb Haaland erred when she allowed the deal to go into effect this summer.

In a brief defending Haaland’s decision to allow the compact to go into effect, lawyers for the U.S. Department of Justice argued that “provisions in the compact reflect a permissible hybrid approach wherein gaming activity that occurs off of the tribe’s Indian lands is authorized under state law, and gaming activity that occurs on Indian lands is authorized by IGRA pursuant to the compact.”

But Friedrich disagreed.

Although the compact deems sports betting to occur at the location of the tribe’s servers, Friedrich’s ruling said “this court cannot accept that fiction.” The judge also rejected the Seminoles’ requests to intervene in the lawsuit and have it dismissed.

The Seminoles quickly asked the U.S. Circuit Court of Appeals for the District of Columbia to block Friedrich’s ruling from taking effect.

A day after a three-judge panel of the appellate court rejected the tribe’s request, the Seminoles stopped accepting wagers and deposits on the Hard Rock SportsBook mobile app. The Seminoles rolled out the mobile app amid the legal wrangling in early November. The tribe’s appeal remains pending.

Dara Kam is a reporter for News Service of Florida

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