The Supreme Court ruled Monday (May 14) that states are free to legalize sports betting, a ruling that is sure to set off a scramble among the states to find a way into a billion-dollar business.
“The legalization of sports gambling requires an important policy choice, but the choice is not ours to make,” wrote Justice Samuel A. Alito Jr., in striking down a federal law that kept New Jersey and other states from changing their laws to allow such gambling.
“Congress can regulate sports gambling directly, but if it elects not to do so, each state is free to act on its own.”
New Jersey for years has tried to breathe new life into its troubled casinos and racetracks by authorizing sports betting at the facilities. As of now, the Professional and Amateur Sports Protection Act (PASPA) allows live betting on sports events only in Nevada facilities, while a handful of other states have sports lotteries.
Former New Jersey governor Chris Christie (R) was one of the leaders of the effort to authorize sports betting in his state.
The case is a high-stakes clash between states that want a piece of the action — New Jersey is supported by 18 other states — and the NCAA, the National Football League, Major League Baseball and other professional sports leagues. They contend that the federal ban is necessary to protect the integrity of their games.
The underground sports betting economy in the United States is estimated to be worth at least $150 billion a year.
New Jersey voters in 2011 approved a referendum proposal to allow sports betting. Christie signed a law authorizing it and dared the federal government to “try to stop us.”
Courts did. They said New Jersey’s law violated a section of PASPA that forbids states to license and authorize sports betting. The Supreme Court decided not to review that ruling.
New Jersey tried a different tactic, taking advantage of a passing comment from the U.S. Court of Appeals for the 3rd Circuit. While the state could not authorize sports betting, the court said, nothing in the federal law prevented the state from repealing statutes that imposed criminal penalties on the practice.
So New Jersey tried that, but lower courts said the state’s intention was the same prohibited activity.