• NJ Sports Betting Enjoined - Court Finds PASPA Preempts State Law
  • January 22, 2015 | Author: Christopher L. Soriano
  • Law Firm: Duane Morris LLP - Cherry Hill Office
  • Although commenting that “the present case is not nearly as clear as the Leagues or the defendants assert,” US District Judge Michael Shipp granted summary judgment in favor of the professional sports leagues and enjoined New Jersey from implementing sports betting pursuant to the legislation it enacted in September 2014. It is widely expected that this case is again headed to the US Court of Appeals for the Third Circuit.

    Last time around, the question hinged on whether the Professional and Amateur Sports Protection Act (“PASPA”) was constitutional. This time, however, Judge Shipp’s opinion focuses almost entirely on “preemption” - the question of whether a federal statute precludes a state from legislating or regulating contrary to a federal statute.

    The Court rejected New Jersey’s argument that the Third Circuit’s opinion in NCAA v. Christie allows the state to partially repeal its prohibition on sports betting. Instead, the Court held that the Third Circuit gave New Jersey two (and only two) options: leave its ban on sports betting in place or repeal it entirely - not a partial repeal as New Jersey has done. The Court dismisses New Jersey’s reading of the Third Circuit’s opinion by stating that “although some portion of the court’s opinion, read in isolation, may suggest a contrary position,” the opinion as a whole stands for the proposition that states only have two options.

    The Court looked to the legislative intent behind PASPA, holding that Congress intended to ban sports wagering authorized pursuant to a state scheme. The Court conclued that “PASPA preempts the type of partial repeal New Jersey is attempting to accomplish in the 2014 Law, by allowing some, but not all, types of sports wagering in New Jersey, thus creating a label of legitimacy for sports wagering pursuant to a state scheme.” The Court hold that any other option other than a full repeal of a sports wagering ban or a full ban would leave the states “too much room” to circumvent the intent of Congress. The Court held that putting age restrictions on the repeal, for example, puts too much of a state imprimatur on sports betting and thus the state’s statute is preempted.

    The matter is ripe for Third Circuit review, as that Court can then decide whose interpretation of its prior opinion - the Leagues or the State’s - is correct.