Federal intervention expected in New Jersey sports betting legalization melee

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January 23, 2013

By Al Ortiz

New Jersey

TRENTON, New Jersey: The tangled web of sports-betting legalization in the state of New Jersey just got messier. Reports out of the state are claiming that The U.S. Department of Justice will intervene in a lawsuit filed by the National Football League and four other sports organizations against a New Jersey law that would allow sports betting at the state’s horse racing tracks and Atlantic City casinos.[1]

Paperwork was filed by the department on January 22 - a three page statement on the last day of a 60-day window allowed by Judge Michael Shipp for the federal government to intervene in the case.

The announced intervention is the newest in a long list of events surrounding the topic of sports betting legalization in New Jersey.

Below is a summary of the developments that took place leading up to this point.

U.S Congress ban

In 1992, the U.S. Congress passed the "Professional and Amateur Sports Protection Act." The Act banned sports betting in all states with the exception of those states that already allowed some form of betting when the law was approved. Such states include: Montana, Oregon, Delaware, and Nevada.[2]

Lesniak's challenge

In 2009, New Jersey State Senator Raymond Lesniak filed a lawsuit in United States District Court that argued that the 1992 federal ban on sports betting in forty-six states should be deemed unconstitutional. In the lawsuit, Lesniak pointed out that the law treats four states differently than the rest of the country. The ban placed an exemption for New Jersey, which was allowed to decide if it wanted sports betting, but the Garden State failed to pass a law that would have enacted this, which effectively killed the exemption.

U.S. District Court Judge Garret Brown dismissed the lawsuit during the week of March 7, 2011, stating that voters had not weighed in on the issue.

2011's Public Question 1

State voters did eventually have a chance to vote on the issue when Public Question 1 was on the November 8, 2011 statewide ballot as a legislatively-referred constitutional amendment.

Despite being referred to the ballot by the state legislature and calling for a constitutional amendment, the measure was not binding. Sports betting would not be allowed in the state until the federal law that limits sports betting in four states was repealed or overturned.

The measure passed with about 64% of voter support.

Aftermath of 2011 vote

On January 9, 2012 the New Jersey State Legislature approved a bill that would allow the state Casino Control Commission to issue licenses to casinos and racetracks to accept bets on some professional and collegiate events.[3][4] The bill was signed and approved by Gov. Chris Christie.[5]

As of January 23, 2012 two proposals were filed in the United States Congress. One was filed by Rep. Frank LoBiondo and another filed by Rep. Frank Pallone. LoBiondo's proposal called for allowing states to seek permission to circumvent the 1992 federal law. Pallone's proposal, however, focused on an exemption solely for the state of New Jersey.[6]

Lawsuit by NFL and other sports organizations

This issue came to a boil, as The National Football League and other professional sports leagues filed a lawsuit in late 2012 against the proposals to allow sports betting in the state of New Jersey.

Lawyers for the state then asked a federal judge to toss a lawsuit filed by the sports leagues. In a 48-page U.S. District Court filing state Attorney General Jeffrey Chiesa and former U.S. Solicitor General Ted Olson say that the federal law limiting sports betting to only select states is unconstitutional.

The National Football league stated that legalization of sports betting in New Jersey would subsequently result in damage to their business, claiming that fans would become suspicious of fixed games. Attorneys for the state of New Jersey countered by saying the professional leagues have benefited from sports betting in Nevada.[1]

The aforementioned intervention from the United States Department of Justice is the latest development on the case, but certainly not the last.