NJ Faces Uphill Battle in Appeal of Sports Wagering Ban

March 5, 2013 – In The News
Law360

New Jersey state officials have vowed to appeal U.S. Judge Michael Shipp's decision upholding the constitutionality of the Professional and Amateur Sports Protection Act of 1992 and blocking the state from authorizing sports betting.

Arguing that a federal ban on state-sponsored sports gambling amounts to unconstitutional commandeering could be the state’s best bet at overturning the decision that blocks such wagering, but convincing the Third Circuit to strike down an act of Congress won’t be easy according to attorneys.

The ruling on competing summary judgment motions was a win for the NCAA and four major professional sports leagues, which claimed the state's sports betting law and regulations clearly violated PASPA and threatened the integrity of their games. Patrick Madamba Jr. cautioned that while the Third Circuit has more discretion than the district court, the state will still have a hard time selling its view of PASPA there.

He pointed to the Third Circuit's 2009 decision in Office of the Commissioner of Baseball v. Markell as an example. In that case, professional sports leagues succeeded in arguing that elements of an expanded sports betting scheme in Delaware violated PASPA.

“Delaware did not squarely confront the constitutional issues, but when you read the case, you get the sense that the Third Circuit is not going to second-guess Congress either. It didn't seem like the Third Circuit had the appetite for it,” Madamba said.

PASPA bars all but four states from licensing or authorizing sports betting. New Jersey was given the ability to join that exempt group but didn't meet a one-year deadline for passing enabling legislation.

Among other arguments, the state has contended that PASPA violates the anti-commandeering principle under the 10th Amendment by hijacking state legislative powers to achieve a federal objective.

The state's 10th Amendment arguments will probably be its strongest on appeal, according to Madamba.

“If you look at the case law, it's like a potpourri of jurisprudence. It's almost like Baskin-Robbins — it offers a flavor for everyone,” Madamba said. “The 10th Amendment argument is probably the most fertile ground for appeal, because the cases are all over the place.”