Judge Shipp hears Pro sports vs. Atlantic City

Feb 19, 2013 3:00 AM

U.S. District Judge Michael Shipp peppered the lawyers for major sports leagues with tough questions during last week’s Trenton, N.J., hearing. His probing inquiries reached to the root of the effort by leagues to block the state’s efforts to install legal sports wagering in Atlantic City casinos.

Did the lawyers for the NFL, NBA, the NCAA and other plaintiffs know of any precedent in the 200-plus years of U.S. history for Congress limiting a legal business to certain states?

The response, according to my sources at the hearing was, no, they did not, but that’s neither here nor there, the leagues lawyers contended.

The case being heard by Shipp explores the constitutionality of the 1992 action of Congress known as PASPA (Professional and Amateur Sports Protection Act) that limited any kind of sports wagering to four states, including Nevada.

New Jersey Gov. Chris Christie remains determined to dismantle this prohibition and add sports betting to the list of casino activities permitted in Atlantic City. The city’s most successful casinos are owned by Las Vegas-based companies such as Caesars and Boyd. They operate casinos in a number of U.S. jurisdictions where lawmakers are tracking the case that is unfolding in Shipp’s courtroom.

There’s no question a successful attack on PASPA by New Jersey will be quickly imitated elsewhere.

And this will damage or bruise the integrity of college and professional sports is a claim by lawyers for the leagues that causes the spokesmen for expanded wagering to roll their eyes and make impolite noises.

Shipp, whose brother Marcel was a running back for the Arizona Cardinals during the 1990s, realizes the complex issues surrounding the constitutionality of PASPA will not be decided in his courtroom. An appeal of his ruling to the Third Circuit Court of Appeals appears all but certain.

And it will not stop there.

“This is going to go all the way to the Supreme Court,” insisted a Las Vegas gaming executive whose company has a major stake in the ultimate outcome.

There’s too much at stake – the future of multi-billion-dollar business, and let’s not forget the billions in both legal and illegal wagering.

Las Vegas attorney Greg Gemignani, who specializes in sports and interactive gaming cases for Lionel Sawyer, says the volume of dollars wagered on sporting events appears to be much more than most people realize. “All the best guesses seem to err on the conservative side …

“When the Delaware tracks were told several years ago they could only accept three-team NFL parlays, they complained they were going to ‘miss their expected Christmas.’ They believed revenue would be short of initial expectations. But as sales increased from week to week,” he said, “they changed their minds and decided Christmas was on again.”

As Ted Olson, former U.S. solicitor general, argued on the state’s behalf, the “landscape” on which PASPA and major sports leagues operate today has been altered in big ways over the last 20 years.

Phil Hevener has been writing about the Nevada gaming business for more than 30 years. He can be reached at [email protected].

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