The Bigger GAME

Only three days before the odds-defying Kansas City Chiefs beat the San Francisco 49ers in Super Bowl LVIIILs last Sunday, as legal sports betting on the game approached an all-time high in more than 30 states across the country, the doors of the U.S. Supreme Court in Washington, D.C., stood open until 3 p.m. for a Florida parimutuel gambling group known as West Flagler Associates.

People called the Super Bowl “the big game.” But there was a bigger game afoot.

Having spent roughly two years working their way through lower courts, West Flagler had until close of business that day, a Thursday before the Sunday championship football game, to file a motion seeking to derail the way sports betting happens in Florida.

Their resistance began following a 2021 deal — a compact, they call it, signed by Gov. Ron DeSantis — between the Seminole Tribe and the state, a case the Supreme Court may or may not finally take up once they’ve seen West Flagler’s brief.

Seminole Tribe of Florida Chairman Marcellus Osceola Jr. (center) watches a pair of dice in mid-air as part of his first throw of dice at a new craps table at Seminole Casino Hotel Immokalee in December when gaming officially expanded. Others at the table are Seminole Tribe Vice Chair Holly Tiger, Ashanti, Jimmy Johnson and Seminole Tribe Councilwoman Mariann Billie.

Already West Flagler had presented a parallel case with different arguments now under consideration by the Florida Supreme Court that could be decided any day, also aiming to derail the sports betting part of the compact.

The rest of the compact — apparently unaffected by the legal challenges to sports betting — includes slot machines, craps and roulette at the casinos, among other things, along with the chance to build more casinos (three in Broward County).

“But this is the case that will move the needle — the U.S. Supreme Court Case,” says Daniel Wallach, an adjunct law professor at the University of Miami who specializes in gambling laws and sports betting in his private practice, as well. He’s described as “one of the nation’s premier legal experts in sports gambling.”

For more than 30 parimutuels in Florida, the compact just isn’t going to work because, they argue, the lucrative sports betting part of it will threaten their livelihoods and violates Florida law.

Seminole Tribe of Florida Chairman Marcellus Osceola Jr. starts the first spin of the roulette wheel at Seminole Casino Brighton as Tribal Council Representative Larry Howard watches the action. Seated at the roulette table are Jimmy Johnson and Evander Holyfield. This was the first day of expanded gaming in December 2023. COURTESY /SEMINOLE TRIBE OF FLORIDA

Parimutuel betting here includes saddle and harness racing of horses, jai alai games (once popular, now only one jai alai fronton remains in Florida) and cardroom poker, given license by the Florida Gaming Control Commission. Bets are placed in a pool, the game’s purveyors subtract taxes and the house take (or “vigorish”), and determine odds by sharing what’s in the pool with all who win bets.

The problem is, they say, the governor and Legislature not only gave the Seminoles monopolistic control, but also agreed to let them take sports bets from people placing those bets with cell phones, tablets or laptops outside tribal lands, from anywhere in Florida.

Representatives of the Seminoles — including Jim Allen, CEO of Seminole gaming and chairman of Hard Rock International — did not return calls or emails to answer questions about their positions. Neither did a spokesperson for West Flagler Associates. And a spokeswoman for Sen. Kathleen Passidomo, Senate president, said she would not talk about the issues in the 2021 compact while they remain in litigation.

WALLACH

But in broad terms, the issues are clear.

Moving violation

On the federal level, West Flagler claims, the compact violates the 1988 Indian Gaming Regulatory Act, which expressly forbids gambling off tribal lands.

A U.S. Supreme Court decision on this issue (if the court takes it up), therefore, could affect how it’s done in other states as well, Wallach suggests.

“If upheld, the Native American tribes in dozens of other states could use the Florida compact as a blueprint for their own compacts and open the door to tribal controlled online sports betting and internet casino gaming,” he told a Miami University magazine.

And on the state level, according to West Flagler — and a companion parimutuel in the challenge, the Bonita-Fort Myers Corp. — the compact violates Amendment 3 of the Florida constitution, which forbids any expansion of casino gambling without the approval of 60% of Florida voters.

PASSIDOMO

A 39-page argument by West Flagler Associates on behalf of parimutuels wraps up their case this way: “The court has quo warranto jurisdiction. It should exercise it to vindicate the People’s exclusive right to control the expansion of casino gambling in Florida.”

But lawyers for the state argued in a 55-page brief that placing sports bets from, say, Crystal Springs or Palm Beach Gardens or Fifth Avenue Naples or a Fort Myers sports bar or The Celtic Ray in Punta Gorda or a marina near Stuart or Sanibel, or anywhere else, violates no gambling laws because all those bets are tallied by a computer and server on tribal land. And anyway, according to them, “sports betting is not casino gambling” in constitutional definitions, anymore than the Florida lottery is.

The state’s lottery includes more than 13,000 ticket-selling outlets everywhere, has made about 3,800 individual millionaires in the state, takes in almost $6 million directly and a great deal more than that in taxes, and violates no gambling laws, lottery officials say.

BERGERSON

But the parimutuels are not the only ones dismayed by the compact, either, notes Peter Bergerson, a recently retired professor of public affairs at Florida Gulf Coast University. And the state itself has soft-pedaled the compact, he says.

“Florida and the governor downplayed it, in a comparative sense,” says Bergerson. “It hasn’t been underground, but it’s a quiet thing and their approach has gone from, ‘Oh no we wouldn’t do this’ (before the 2021 compact) to, ‘now you can do sports betting on your phone.’

“The Disney entertainment people are opposed to it because it cuts into the leisure activity budgets many people have. Busch Gardens and the whole Orlando entertainment industry… I was so surprised at the quietness of it.”

In some circles, it hasn’t been that quiet. The opportunity to build new casinos or for those with gaming permits to move their locations in South Florida, from, say, the Big Easy Casino in Hallandale

From left: Kevin McCrystle, Charles Hanson Gillespie and William Hanson own the Gambling.com Group. COURTESY PHOTO

Beach to the Fontainebleau Hotel in Miami Beach, or to create a gaming site at Donald Trump’s golf resort in Doral, could come with the passage of two bills now before legislators, one in the House and one in the Senate, that if passed would override the objections of local governments.

“It’s an existential threat to our community,” former Miami Beach Mayor Dan Gelber told the Miami Herald last month in a story that reported those details.

He did not respond to a query from Florida Weekly asking him to elaborate on that opinion.

“One of the things that happens with casinos is, local bars and restaurants really take a whipping,” noted Bergerson. “The entertainment aspect (of a community) suffers outside the casino — and Miami Beach has a huge revenue from tourism. (Gelber) is against it because he knows what happens.”

The current sports betting scene

The sports “book” — the one taking legal sports bets in the Sunshine State — is the tribal subsidiary of Hard Rock Café. Also operating in other states, in Florida, Hard Rock holds an exclusive contract with the Tribe and offers an app to do the betting.

New Jersey, by contrast, has 10 sportsbooks, each offering different deals or benefits for those using them in that state, explains William Hanson. With partners Charles Hanson Gillespie and Kevin McCrystle — they grew up together on the southwest coast in Fort Myers — Hanson co-owns the publicly traded, international firm, Gambling.com Group (Nasdaq: GAMB), where he’s vice president of Business Analytics and president of GDC America ( www.gambling.com/us/sports-betting/florida ). The company has European offices in Dublin and Monaco, and American offices in Charlotte, North Carolina, New York City, Tampa and elsewhere.

“We provide content. We’re a media company that focuses on gambling the way some do on hotels or credit cards or mountain bikes. We provide reviews and information, and direct users,” Hanson says. “People come to our websites for information regarding sportsbooks and casinos — the deals and bonus offers.”

There are many for shoppers to compare, which is the service Gambling.com provides, contracting separately with each sportsbook, including the two biggest in the business, Fanduel and Draft Kings.

“I am pro sports betting in Florida,” Hanson says, adding that the decision of the courts one way or another won’t strongly affect his company, but it will certainly affect consumers. “It’s like marijuana in a way. It’s everywhere, it’s going to happen. Florida is missing out by not getting their piece of the pie.

“If the compact passes in whole, and allows the Seminoles to continue conducting business their way, I can only assume they will eventually allow other (sports betting) business to come in.”

The competition among sportsbooks is fierce, and even in a one-book state like Florida, there are still deals for consumers.

“Hard Rock, for example, has a welcome bonus — a 100% bonus up to $100, so if you place a $100 bet, you’re actually gambling with $200. And each casino or sportsbook has different attractions. We accumulate all that information and present it to the consumer. We say, ‘Hi, here are the rules, here’s where you can play, here’s a link, here’s the bonus offer. In New Jersey, with 10 places, we cut deals with each operator, each book.

We’ll have individual deals with each of them, we’ll review their site, and we’ll tell the consumer what software they use, and what the user experience is like.”

And it’s not just the sportsbooks. Other companies with no traditional gambling interests are now involved, suggesting how popular and wide-reaching legal sports betting has become.

In a press release one year ago this month, the American mass media company Gannett, the largest U.S. newspaper publisher by circulation, “today announced a multi-year strategic partnership with Gambling.com Group Limited (Nasdaq: GAMB), a leading provider of player acquisition services for the regulated global online gambling industry. Under the agreement, Gambling.com Group will provide relevant content for sports enthusiasts while leveraging Gannett’s reach across the U.S. media landscape through the USA TODAY Network across the country.”

Gannett owns more than 100 daily newspapers and 1,000 weeklies, including USA Today, TCPalm digital on the Treasure Coast, and both The Naples Daily News and The News-Press in Fort Myers.

Which way the wind is blowing

Since 2018, when a change in federal law opened sports betting to locations outside of Nevada, more than half the states have joined the moneymaking parade, starting with New Jersey, each adopting its own rules governing how it’s done.

In that six-year period, according to legalsportsreport.com , New Jersey’s “handle” was roughly $45.7 billion, its revenue about $3.4 billion, its “hold” — the amount the sportsbooks make as profit or commission on actual wagers — averaging 7.4%, and taxes from all that not quite $470 million.

In 2021, DeSantis and the Legislature brought Florida into the new mix by signing the now-contested compact.

In return, the state was to get $2.5 billion in the first five years from the Seminole Tribe, and potentially $20 billion or more over the 30-year compact. To put that in perspective, each billion amounts to 1,000 million.

But the money and sports betting from outside tribal lands were put on hold because legal challenges started almost immediately.

That hasn’t stopped people from counting the eggs before they’ve hatched, however, or directing money the state accrues from the portion of the compact untouched by legal challenges. And as a time grows nearer when courts may decide the sports betting issues, interest is pointed.

“Sen. (Travis) Hutson (R-7 on the Palm Coast) is sponsoring legislation to use revenues available through the gaming compact that Gov. DeSantis signed with the Seminole Tribe in 2021 to establish dedicated funding for continuing acquisition and management of our conservation lands,” Sen. Passidomo announced in her statement opening the session as Senate president last month.

The legislation is Senate Bill 1638.

“Using these new revenues to acquire and manage conservation lands and invest in our clean water infrastructure will be a phenomenal return on investment for our state,” she added, encouraging legislators to support it.

The fact remains, however, that the compact was vulnerable to a challenge, says Wallach, and in more than one way. West Flagler took advantage of that opening, but in one sense, and at least at the state level, the deck is stacked against them, perhaps.

“That case has been fully briefed and is waiting for a decision from the Florida Supreme Court, and the likelihood is the Supreme Court will deny the petition or transfer it to the Leon County Supreme Court” — and let them say no, Wallach suggested.

“Under Gov. DeSantis’s tenure, (they’ve heard) 14 cases seeking a writ of Quo warranto. Not once has it ever been granted. They denied it in half the cases and transferred it in the other half.”

Quo warranto means by what right or authority, a “common law remedy” used in this case to challenge the governor’s imperatives.

There’s a reason, says Wallach.

“This is a court DeSantis has played a strong hand in shaping. Of the seven justices, five were appointed by DeSantis. We thought we might not see that again when Trump appointed three judges in four years to the U.S. Supreme Court, but Gov. DeSantis has appointed five.”

One of those then-President Trump appointed to the U.S. Supreme Court is Associate Justice Brett Kavanaugh. When West Flagler first asked the U.S. Supreme Court last fall for a stay of the Florida compact, their petition was denied.

Usually, no explanation or elaboration is given when that happens, Wallach said. But on that occasion, Kavanaugh “thought the decision was important enough to write about it. He agreed with the Court’s decision to deny application for a stay based on (a circuit court’s) pronouncement — that the Compact only authorized gaming operations on reservations, not off — but in the next sentence, he wrote:

“If the compact authorized the Tribe to conduct off-reservation gaming operations, either directly or by deeming off-reservation gaming operations to somehow be on-reservation, then the compact would likely violate the Indian Gaming Regulatory Act, as the District Court explained.

“To the extent that a separate Florida statute (as distinct from the compact) authorizes the Seminole Tribe — and only the Seminole Tribe — to conduct certain off-reservation gaming operations in Florida, the state law raises serious equal protection issues.”

For the law professor and gaming law expert, such an unusual response from a U.S. Supreme Court justice “suggests there is some division on the Court,” Wallach says.

“You only need four justices to grant certiorari” — the word means to learn more or become better informed, which is how the Supreme Court usually chooses the cases it hears.

“It seems West Flagler may already have a solid vote in Kavanagh, so the question remains: Can West Flagler get three other votes?”

And if so, can sports betting in Florida take place from any location, on or off the reservation? ¦

The post The Bigger GAME first appeared on Charlotte County Florida Weekly .