Fifth Birthday Of Historic U.S. Supreme Court Decision On Sports Betting

May 12, 2023
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It seems appropriate for Mother’s Day to fall this year on the same day as the fifth anniversary of the United States Supreme Court decision which gave birth to what has quickly become the world’s largest sports-betting market.

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It seems appropriate for Mother’s Day to fall this year on the same day as the fifth anniversary of the United States Supreme Court decision which gave birth to what has quickly become the world’s largest sports-betting market.

In those five years, legal and regulated sports betting in the United States has mushroomed into an industry set to be worth more than $10bn in annual revenue in 2023, according to VIXIO GamblingCompliance projections.

“I’m not sure if even the most bullish forecasters would have guessed we would get here this quickly,” said John Holden, an associate professor of business at Oklahoma State University.

The Supreme Court’s 6-3 ruling overturned the Professional and Amateur Sports Protection Act of 1992 (PASPA) and its federal ban on sports betting in all states except Delaware, Montana, Nevada and Oregon.

Nevada essentially controlled a national sports-betting monopoly because it was the only state where brick-and-mortar casinos regularly processed wagers on games.

The first task confronting an emerging sports-betting industry after the Supreme Court decision on May 14, 2018 was achieving a “critical mass” of customers, according to Bob Jarvis who teaches gaming law at Shepard Broad College of Law in Davie, Florida.

“You have critical mass now with 37 states,” Jarvis said, referring to the number of states that have legalized sports wagering since the Supreme Court ruling.

The challenge of the next five-year phase will be persuading the Big Three states — California, Florida and Texas — to also legalize sports betting, Jarvis said.

More than five months before Justice Samuel Alito read the court’s decision to nullify PASPA, the Supreme Court heard oral arguments in the case on December 4, 2017.

It was like a heavyweight championship boxing match featuring two of the nation’s most accomplished trial lawyers — Ted Olson, a former U.S. solicitor general representing New Jersey in its bid to expand sports betting; and Paul Clement, another former solicitor general representing the nation’s major sports leagues in supporting PASPA.

“There was no one in the room that thought PASPA would be upheld,” said Dennis Drazin, an attorney in Red Bank, New Jersey, who wrote the New Jersey sports-betting law that was ultimately upheld by the Supreme Court.

Sitting next to Drazin in the hearing room packed with 250 spectators was Joe Asher, who was then directing sports-betting operations in the United States for William Hill.

”There were a number of interesting moments, but if I were to pick one, it was when Chief Justice [John] Roberts basically scoffed at the argument by the U.S. Department of Justice (which joined the leagues in opposing New Jersey) that unregulated sports betting was acceptable under PASPA,” said Asher, who is now president of sports betting for IGT.

Ironically, soon after it became apparent they would lose the PASPA case, the leagues almost immediately began demanding a share of the sports-betting pie and then started to form commercial and lobbying partnerships with sports-betting operators like DraftKings and FanDuel.

As successful as sports betting has become since the Supreme Court decision, the specter of scandal continues to rear its ugly head.

Major League Baseball struggled for years to recover from the Black Sox scandal of 1919 when the Chicago White Sox fixed the World Series by accepting money from gamblers to deliberately lose to the Cincinnati Reds.

Just last month, the National Football League suspended four players on the Detroit Lions and one on the Washington Commanders for betting on NFL and college games in violation of league rules.

“Leagues and teams have not only accepted sports betting but have embraced it,” said Andrew Brandt, a professor at Villanova University and a former executive with the Green Bay Packers.

“It is hard to watch or experience a sporting event without being hit in the face with advertising for DraftKings, FanDuel, PointsBet or several others,” Brandt said.

“With these sports leagues and betting, it is, ‘Do what I say; not what I do’.”

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