The prospects for a Florida sports betting relaunch may have improved last week when a three-judge US District Court of Appeals, District of Columbia Circuit panel unanimously overturned a previous ruling that invalidated a gambling agreement between the state government and the Seminole Tribe of Florida.
So far the Seminole’s Hard Rock app has yet to suddenly spring back to life and begin accepting legal wagers.
But that’s how the app launched the first time on Nov. 1, 2021: without fanfare or a previous announcement. Hard Rock wielded its monopoly on Florida sports betting until Dec. 4 even though US District Court, DC Circuit Judge Dabney L. Friedrich ruled its deal with Florida beyond the scope of tribal gaming law on Nov. 22.
At issue was the so-called “hub-and-spoke” model that allowed the Seminoles to offer state-wide mobile sports betting off tribal lands using servers handling wagers that were located at the tribe’s casino property in Hollywood, Fla. The Department of the Interior, which tacitly approved the compact by allowing it to pass into law after a mandatory wait period, asserted that the Indian Gaming Regulatory Act (written in the pre-Internet era) was fluid enough to allow for the hub-and-spoke opportunity to be pursued.
Friedrich deemed it a “legal fiction” before voiding the whole deal, which would have also granted the Seminoles the right to offer craps and roulette in their six Florida casinos in exchange for at least $2.5 billion in revenue-sharing over the first five of the 30-year deal.
Attorneys for the plaintiff, West Flagler Associates, were confounded by the ruling, with Hamish Hume telling Gaming Today they were “evaluating our possible next steps.” The team told Gaming Today on July 21 that no decisions had yet been made about future legal action.
Further Challenges Could Slow Florida Sports Betting Redux
Even with the court victory for the Department of the Interior — the Seminoles were never a plaintiff despite their desire to be — more appeals are likely to ensue from the group of Florida parimutuel facility owners: West Flagler Associates, the former owner of Magic City Casino in Miami and the owners of Bonita Springs Poker Room.
Several tribal legal analysts, including those who’d predicted victory for both sides, expect the case to eventually terminate in the Supreme Court, where several major cases involving tribal sovereignty have been addressed in the past two years.
Various estimates put the value of a legal sports betting market in Florida at $8-12 billion annually.
Florida Sports Betting Decision Has National Implications
The Seminoles have long been a bellwether in Native gambling and this case will have major repercussions for more than the tribe that describes itself as “The Unconquered.”
A relaunch of sports betting in Florida with Hard Rock in control would mark the second major victory for Native gambling in a year, with tribes in California rallying to defeat a ballot measure that would have ended their monopoly and opened that state to national operators.
Along with California and Texas, Florida is one of the most succulent of fruits left to be picked for the legal sports betting industry in the United States. DraftKings and FanDuel spent millions last year unsuccessfully attempting to spark a ballot measure to legalize sports betting outside of the Seminoles compact.
With a population of more than 22 million, Florida would become the most populous state with legal sports betting. And the largest monopoly.
Why Florida Sports Betting Launch Would Be Important
- 22 million-plus residents: Florida would be the largest of 37 US jurisdictions in some phase of legalized sports betting.
- Major tourist destination bringing outside cash to pro sports events including Spring Training, frequent Super Bowls, and national college championships.
- Native American tribes nationally would want the same right to offer sports betting beyond tribal lands. Especially the ones in states like Connecticut, where they’ve negotiated deals with state governments beyond the compacts to offer state-wide mobile sports betting in exchange for extra fees or taxes.
What Was the Appeals Court’s Rationale?
The panel agreed with tribal legal observers like Bill Pascrell III, a lobbyist with PPAG–Princeton Public Affairs Group and Derril Jordan, an attorney at mctlaw who has served as in-house counsel for three Native American tribes in asserting that IGRA was designed to be flexible enough to allow for evolutions like the hub-and-spoke model. The judges concluded that IGRA allows for betting on tribal lands, but doesn’t forbid it off them.
The 24-page opinion noted that state challenges were a possibility, but deemed that not part of its purview.
Hume took exception with what he feels is a contradictory interpretation of IGRA.
“The Court correctly recognized that IGRA does not and cannot authorize gambling off of Indian lands, but then upheld a compact that purports on its face to do exactly that. We respectfully disagree with that decision … ”
Will Sports Betting Resume in Florida Soon?
Eager sports bettors in Florida checking their Hard Rock app would have through Wednesday morning still found this:
The app allows the hopeful to peruse Hard Rock betting lines, but will not accept bets. The site isn’t taking deposits, but withdrawals appear to still be possible.
Gambling opponents in Florida certainly will try to keep the proverbial switch from flipping.
Hard Rock customer service advises users to follow the company’s Twitter accounts. Queries to Seminole Gaming have yielded this response following the court decision:
HOLLYWOOD, Fla., (June 30, 2023) – The Seminole Tribe of Florida is pleased with today’s unanimous decision. It is a positive outcome for the Seminole Tribe and the people of Florida, and for all of Indian Country. The Tribe is fully reviewing the decision to determine its next steps.
Gary Bitner, Seminole Tribe spokesman
What the Seminoles Got in the 2021 Compact
- Control of a new Florida mobile sports betting market. While industry analysts would prefer a competitive market, the launch of sports betting is seen as at least a step toward a more desired outcome. That would be a fight for another day and the type the Seminoles vigorously approached in the past when trying to defend their position.
- The Tribe could sign marketing agreements with Florida parimutuel operators, returning 40% of profits to the Seminoles, for the right to offer branded sports betting as a much-needed revenue stream. Most of these operators considered it a bad deal but had pursued them anyway.
- The right to keep the market for itself by paying more money in revenue-sharing to the state.
- The right to offer craps and roulette at their casinos.
- The right to expand with up to three more facilities at its Hollywood property, despite voter approval of a 2018 state amendment requires further government approval for gambling expansion.
What Can West Flagler and Associates Do Now?
- Ask for the entire US District Court of Appeals, District of Columbia Circuit to hear the case.
- Fight in Florida, where Amendment 3 is supposed to put gambling expansion to the voters. John Sowinski, a spokesperson for No Casinos and other South Florida gambling-expansion opponents told the Miami Herald the decision “will not be the final word on the issue.”
- Appeal to the Supreme Court. But the Court hears only about 100-150 of the 7,000 that are requested yearly.
- Take the marketing partnership deal. Since the lawsuit began, the Havenick family that constituted West Flagler Associates has sold Magic City Casino to the Poarch Band of Creek Indians.
The Supreme Court Factor in Florida Sports Betting
Steven Geller, the general counsel of the National Council of Legislators from Gaming States, and a former Florida senator and representative expressed concern that a 5-4 Supreme Court decision in Oklahoma vs. Castro-Huerta could eventually erode tribal autonomy. That case, which had nothing to do with gambling, established that federal and state governments had concurrent jurisdiction to prosecute crimes committed by non-Native Americans on tribal lands. It pertained to gambling, Geller contended, because it essentially nullified a 5-4 Court ruling in a similar McGirt v. Oklahoma case in 2019.
A 7-2 decision this summer to reject challenges to the Indian Child Welfare Act, which was enacted to keep Native American children with their tribes, was widely viewed as a win for tribal sovereignty, however.
The Seminoles attempted to intervene in this case but were denied, with the court’s noting that “any infringement on [its sovereign] immunity is ‘remote’ and ‘theoretical.’”
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