Breaking the Ban: Sports Gambling, Anti-Commandeering, and Lots and Lots of Money

By Brand, George R. | Missouri Law Review, Summer 2019 | Go to article overview

Breaking the Ban: Sports Gambling, Anti-Commandeering, and Lots and Lots of Money


Brand, George R., Missouri Law Review


Murphy v. National Collegiate Athletic Association, 138 S. Ct. 1461 (2018).

I. INTRODUCTION

While Las Vegas is now commonly considered the pinnacle of modern American gambling, this has not always been the case. (1) In the late 1970s, Atlantic City, New Jersey, set out to challenge Las Vegas' standing as America's top gambling destination. (2) The first Atlantic City casino opened in 1978, (3) and between 1978 and 1985 the city's casinos generated an average annual revenue growth rate of 55 percent. (4) By contrast, Las Vegas' first seven years of legalized gambling from 1970 to 1977 only saw an average annual growth rate of 15.6 percent among its casinos. (5) In 1985, Atlantic City's total gambling revenue was almost fifty percent greater than that of the Las Vegas strip's. (6) However, modern-day Atlantic City does not hold a candle to Las Vegas when it comes to gambling revenues. In 2017, the Las Vegas strip brought in almost five times the gambling revenue of Atlantic City. (7)

While there are myriad factors impacting historical trends in gambling revenues across America, this Note will focus specifically on the legal treatment of sports gambling. In 1992, Congress passed the Professional and Amateur Sports Protection Act ("PASPA"), (8) which banned sports gambling nationwide, with a few exceptions such as Las Vegas. (9) Under PASPA, all states had a one-year grace period after the statute went into effect where they could legalize sports gambling within their state and escape PASPA's pending ban. (10) Although New Jersey failed to take advantage of this loophole during the grace period, state legislators attempted to legalize sports gambling twenty years later when voters approved an amendment to the state constitution in 2012. (11) After a three-year legal battle with the National Collegiate Athletic Association ("NCAA") and the National Football League, National Basketball Association, National Hockey League, and Major League Baseball ("the Leagues"), that progressed all the way to the Supreme Court of the United States, New Jersey ultimately lost its initial attempt to legalize sports gambling. (12)

After the failed attempt to legalize sports betting via constitutional amendment, New Jersey tried a different route in 2014 when it repealed provisions of state law that had previously prohibited sports gambling ("2014 Act"). (13) The opponents from the prior litigation again filed a federal suit challenging the constitutionality of the 2014 Act. (14) After losing at the state and circuit level, New Jersey ultimately prevailed when, in 2018, the Supreme Court determined in Murphy v. National Collegiate Athletic Association that PASPA's ban of sports gambling was unconstitutional because it violated the well-established anti-commandeering doctrine. (15)

This decision marked only the third time the Court had struck down a state law for violating the anti-commandeering doctrine. (16) While we are still very much in the wake of the Murphy ruling, its constitutional implications for other clashes between state and federal law are yet to be determined. Within a few months after the Murphy decision, four states joined New Jersey in passing legislation to fully legalize sports gambling, and many other states have since passed limited legalization of certain types of sports gambling. (17) More than a dozen other states have legislation pending to legalize sports gambling in whole or in part. (18) As revenues from legalized sports gambling continue to rise, stakeholders are well entrenched in quibbles over dividing the earnings appropriately. The Murphy ruling will undoubtedly go down as a watershed moment in the narrative of American sports gambling, and its implications for federalism, state power, and the Constitution loom just as large.

II. FACTS AND HOLDING

On October 16, 2014, the New Jersey Senate repealed portions of state law prohibiting betting on professional, collegiate, or amateur sporting events in Atlantic City or at horseracing tracks throughout the state. …

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