SECAUCUS, N.J. — Third-party vendors working with Hard Rock and the Seminole Tribe in offering sports betting in Florida are putting their licenses at risk in other states, gaming attorney Daniel Wallach opined at the SBC Summit North America on Wednesday.
That opinion, though, has been retorted by Jeffrey Ifrah, another leading attorney in the gambling industry who sat on the panel where Wallach made his remarks.
Despite U.S. District Court Judge Dabney Friedrich negating the compact between the Seminoles and the state of Florida that gives the tribe exclusivity in the state’s sports betting industry, wagers continue to be accepted on the Hard Rock app, “illegally under federal law as well as illegally under state law,” per Wallach. “Judge Friedrich’s opinion makes crystal clear that continuing to accept online bets is in violation of federal law.”
Partners to the Seminoles and Hard Rock, such as technology providers and payment processors, are also in violation of a number of federal anti-gambling laws, and they are placing “their precious gambling licenses in jeopardy in other states,” Wallach said.
“I congratulate the American Gaming Association, the industry, the New Jersey Department of Gaming Enforcement on raising awareness and visibility around the illegal offshore gaming market, but what are we doing about the illegal onshore gaming industry?” Wallach stressed. “Because right now there are people in this room that work with licensed vendors, licensed by the state of New Jersey, that are aiding, abetting, and substantially assisting the continued operation of the Hard Rock Sportsbook in violation of federal and state law.”
He added, “If you’re a regulator licensing these companies and they’re continuing to power this illegal sportsbook, what are you going to be doing from a licensing perspective? If I’m the outside counsel representing these companies, I tell them to cease and desist immediately. Why would you place your license on the line when a federal judge has unambiguously concluded that these activities are in violation of federal law?”
“I just want everyone to know that’s Dan’s opinion,” clarified moderator George Rover, Managing Partner, Princeton Global Strategies.
“I’ve been right all along (about the Florida compact),” Wallach responded. “I haven’t rolled a gutter ball yet on this issue.”
Ifrah told Gaming Today on Thursday that Wallach’s opinion lacks merit.
“I don’t agree with that sentiment,” Ifrah said.
“This is not that much different than what happened with daily fantasy,” Ifrah continued. “At a certain point, states including New York and others were basically saying ‘Hey, daily fantasy is illegal’ and that was coming from the attorney general, the highest level of authority in the state, and notwithstanding you still had DraftKings and FanDuel operating in those states while they were negotiating with the attorney general, and I think that’s what’s happening now.”
Sports betting will continue in Florida while the issue is being resolved, Ifrah anticipates, and the vendors are not at risk as Wallach suggested.
“The market’s not going away,” Ifrah said. “I don’t think a tribe in Florida is going to be told by a judge in DC that everything needs to stop. …
“If it was a black and white issue, I think regulators around the country would have concerns. Hard Rock doesn’t just operate in Florida. They operate in New Jersey, they operate in Indiana, they have casinos all over the country — some regulator would step in, and that would be the type of authority that (vendors) would listen to.”