SECAUCUS, NJ – As Seminole Gaming seeks a stay of a federal judge’s order that prohibits it from offering sports betting across Florida, a leading gaming attorney said that the continued operation of the Hard Rock sportsbook app in the state not only breaks federal and state laws but it could also affect licenses for other companies, too.
Daniel Wallach spoke about the federal lawsuit involving the Florida gaming compact during a Wednesday afternoon conference session on the Wire Act of the SBC Summit North America, a two-day sports betting and iGaming conference at the Meadowlands Exposition Center.
The Seminole Gaming case came up during the session because lawsuits seeking to block the compact have cited the 60-year-old law as one of the reasons why the gaming compact should be blocked.
In August, the Magic City Casino and the Bonita Springs Poker Room filed a lawsuit against the federal government for allowing an amended gaming compact they claimed violates the Indian Gaming Regulatory Act to go into effect. That compact gave the tribe exclusive rights to mobile sports betting in the state of Florida.
Late last month, District of Columbia US District Judge Dabney Friedrich ruled in Magic City and Bonita Springs favor and threw out the entire compact. Friedrich said in her ruling that the online sports betting aspect of the compact violated the federal law that oversees gaming on tribal lands.
After Friedrich denied the Seminole Tribe’s request for a stay last week, the tribe made an emergency appeal to the DC US Circuit Court of Appeals for a stay that would allow it to continue offering mobile sports betting while the tribe appeals the judge’s order.
Wallach: Hard Rock Vendors May Face Licensing Issues
Despite Friedrich’s order and the initial denial of the stay, the Hard Rock sportsbook has continued to accept bets in Florida.
Wallach said that Freidrich’s order made it “crystal clear” that doing that is illegal. He noted that the American Gaming Association, the New Jersey Division of Gaming Enforcement, and the US industry, in general, have done a good job in raising awareness on illegal offshore gaming activities.
But what are we doing about the illegal onshore gaming industry?” he asked. “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 digital sportsbook in violation of both federal and state law.”
At the very least, Wallach said those activities violate the Unlawful Internet Gambling Enforcement Act, the Travel Act, and the Illegal Gambling Business Act.
Wallach also said regulators in other states that have licensed vendors and operators working with the Hard Rock app need to look into the issue as well. If he was their attorney, Wallach said he’d tell the vendors to stop doing work in Florida 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?” Wallach said.
A message to a Seminole Tribe spokesperson was not immediately returned for comment.
In a court filing Wednesday, the tribe said Friedrich’s order produced “an immediate chilling effect” as some vendors have stopped doing business with its gaming operations.
It also said that will the tribe will defend its case, claims made previously by the parimutuels that it would continue to operate illegal gaming “is simply false.”
Decision Expected in the Near Future
A decision from the DC Circuit Court of Appeals on the Seminole Tribe’s motion to let it continue offering sports betting could come soon. In its motion last week, it asked for a ruling by Friday.
Without a stay on Friedrich’s order, the Seminole Tribe the state of Florida stands to lose about $40 million in monthly revenue payments agreed to in the compact. Besides allowing sports betting, the new compact also gave the Tribe the ability to offer roulette and dice games at its casinos and open additional casinos as well.
Even if a stay is granted at the appeals court, the possibility exists the tribe could still lose when that court takes up the entire case. There’s also the possibility that only the portions of the compact dealing with gaming outside of tribal lands are removed from the deal.
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