The DC Circuit Court has released its decision on sports betting, saying that the Seminoles can operate mobile betting within the state.
The ruling reverses a Federal District Court decision that the 2021 Compact with the Tribe, which effectively granted it a monopoly on sports betting in Florida, was a violation of the Indian Gaming Regulatory Act.
Hard Rock Digital’s sportsbook was forced offline in December 2021 after a little over a week due to a lawsuit filed by West Flagler Associates, a casino operator.
Seminole spokesman Gary Bitner said to iGB that the Seminole Tribe of Florida was pleased by today’s decision.
The Seminole Tribe, the state of Florida, and Indian Country as a whole are all pleased with the outcome. The tribe will review the entire decision and determine what it’s next step is.
Background: The push to bring sports betting in Florida by 2021
This case dates back to the beginning of 2021. In that year, Ron DeSantis approved a compact that allowed the tribe to provide mobile sports betting and on-site wagering in the state. This compact covers the roulette and craps tables at tribal casinos located in the state. Betting would also be run from servers situated on the land of the tribe.
The Seminoles were able to join forces with parimutuel operators and pay 13.75% of the profits, as well as 10% from their casino sportsbooks.
The US Department of the Interior “approved’ the compact after it had been ratified and passed by the state legislature, as well as signed by DeSantis. The DOI didn’t explicitly accept or reject the deal, but it did nothing within the 45 day window. This meant that it went into effect automatically.
A case against compact
West Flagler Associates, a parimutuel betting operator in Florida, and Bonita Fort Myers Corporation sued each other on September 20, 2021. They argued that the mobile element was an expansion of tribal land. Plaintiffs claimed that this could only be done through a referendum in the state.
They also claimed that it was a violation of the Unlawful Internet Gambling Enforcement Act and the Wire Act as they were placing bets from a US jurisdiction, where online betting is illegal.
According to the suit, Indian Gaming Regulatory Act clearly states that bets placed by tribal members must take place on tribal lands. It argued that the Seminole Tribe and Florida State could not change tribal boundaries or convert gaming off tribal land into gaming on tribal land.
Dabney Frederick, the judge who heard the case, ruled that the agreement attempted to “authorise the sports betting on Indian land as well as off Indian land”.
Friedrich, reinstating Seminoles 2010 compact, noted that the Compact itself allows such wagering by customers who are “physically located” in Florida but not the Indian Lands of the tribe.
The HTML0 ruling is explained
Judges of the Circuit Court rejected, in the end, the argument that Interior Secretary Deb Haaland had violated Administrative Procedure Act by not acting on the Compact. She allowed the compact to become law when the 45-day deadline passed.
The APA also denied that “approval by inaction” was a violation of the APA, for four reasons.
- It was illegal for the Indian Gaming Regulation Act to allow gaming on Indian lands.
- It violates the Wire Act
- It violated Unlawful Internet Gambling Enforcement Act.
- It violates the Fifth Amendment guarantee of equal protection.
Do mobile betting sites fall on Indian land or not?
Court ruled that the Seminole Tribe can offer sports wagering on their lands, despite the first argument. It “deems”, for mobile bets that they were placed on Indian land, and doesn’t allow online betting.
The inclusion of a subject in the compact does not affect the legality of other activities, such as placing wagers outside Indian land, according to state or tribal law.
The presiding Judge admitted that the judgment was very narrow, and only ruled on the fact that Haaland had not broken the APA.
We express no opinion on whether or not the Florida Statute ratifying compact is constitutional […].
This question, and all other questions related to state law, fall outside of the Secretary’s review, our judicial review, and are better left up to Florida’s court system.
A successful legal challenge would force the Seminoles mobile sportsbook to go offline.
How about other claims?
In the suit, it was argued that the agreement would authorize transactions which violated the 1961 Wire Act. West Flagler claimed that online communications “almost always” are routed to servers within and outside of the state.
The judges, however, rejected this argument, not least of all because the Compact does not authorize transactions. This fact “by itself precludes the Wire Act Challenge”.
The judge stated that the Wire Act is explicitly mentioned in the Compact, which states that the Seminoles are required to act “strictly” according to the Wire Act. The argument is not valid as it does not apply to bets made on Indian land using West Flagler’s reasoning.
The charge of violating UIGEA received the same treatment. According to the ruling, the compact could not have been used as a tool for a breach, so the accusation was purely hypothetical.
The Fifth Amendment violation has been dismissed entirely on the grounds that the “promotion of economic development for federally recognized tribes” is constitutional.
