The Department of Justice has entered the legal battle over legalizing sports betting in New Jersey. It will join the NBA, MLB, NHL, NFL, and NCAA in challenging the state’s efforts to implement a New Jersey law authorizing sports betting. They argue that the law violates the federal Professional and Amateur Sports Protection Act (PASPA).
The DOJ could have file the initial suit, but choose to allow the sports leagues to test the legal waters. Now that a district court judge in New Jersey has given the case the green light, the DOJ has asked to participate by filing briefs in support of the constitutionality of the PASPA. It will also participate in oral arguments, currently scheduled for February 14, 2013.
As discussed on PolitickerNJ, the PASPA specifically prohibits governmental entities, including the states, from authorizing sports wagering. The only current exceptions are the states of Nevada, Oregon, Montana and Delaware. The statute also authorizes professional and amateur sports organizations, as well as the United States Attorney General, to file lawsuits to enforce its provisions.
In seeking to legalize sports betting, the state of New Jersey argues that the federal ban is unconstitutional. It specifically maintains that the power to regulate gambling and benefit from the revenue it generates should rest with the states and not the federal government. New Jersey further argues that the PASPA violates the equal protection clause of Fourteenth Amendment because it is not applied equally across all states.
While the DOJ now stands firmly behind the constitutionality of the PASPA, it was not always so certain. Before the law was passed in 1992, Assistant Attorney General W. Lee Rawls sent a letter to Congress expressing concerns that the bill restricted legalized sports betting to just a few states.
"We note that determinations of how to raise revenue have typically been left to the states," wrote Rawls. "The department is concerned that ... it raises federalism issues."
These same issues will likely take center stage next month. Given the potential impact on New Jersey businesses, we will continue to monitor this case and provide updates as they become available.
If you have any questions about this case or would like to discuss how it may impact your business, please contact me, Donald Pepe, or the Scarinci Hollenbeck attorney with whom you work.
