The Supreme Court has temporarily suspended a lower court ruling that allowed a $2.5 billion online sports betting deal between Florida and the Seminole Tribe to move forward.
Online sports betting is a rapidly growing industry. The market is expected to reach $7.6 billion in the United States in 2023, according to the Statista website.
The ruling came at the request of two Sunshine State casino operators who view the recognized Indian tribe as a business competitor.
The tribe had planned to offer online sports betting in Florida. The established casino operators, who argue the deal unfairly grants the tribe a monopoly on sports betting in the state, have also requested a long-term stay of the lower court order.
Chief Justice John Roberts granted the stay late in the day on Oct. 12 in an emergency application brought in West Flagler Associates Ltd. v. Haaland (court file 23A315).
The applicants, West Flagler Associates Ltd. and Bonita-Fort Myers Corp., operate gambling facilities in the state. The gambling businesses are the Magic City Casino in Miami and the Bonita Springs Poker Room in Bonita Springs.
The respondents are U.S. Secretary of the Interior Deb Haaland and the Seminole Tribe.
The tribe’s government is headquartered in Hollywood, Florida. More than 90 percent of its budget comes from gambling revenue. The tribe is also involved in cattle ranching, citrus production, tourism promotion, sports management, and tobacco sales. Almost 3,300 Seminole Indians live on and off reservations throughout the state, according to the tribe’s website.
The emergency order puts on hold the decision of the U.S. Court of Appeals for the District of Columbia Circuit favoring the tribe “pending [the] further order” of the Supreme Court or of the chief justice.
Secretary Haaland and the tribe have until 5 p.m. on Oct. 18 to file a response.
It is unclear what the Supreme Court will do or when it will do it. The justices could decide to treat the emergency application as a petition for certiorari, or review, and order oral argument in the case. At least four of the nine justices must approve a petition for it to move forward to the oral argument stage.
The case goes back to 2021 when Gov. Ron DeSantis’s administration signed an agreement with the tribe giving it the exclusive right to offer online betting in Florida. The state would take a percentage from the billions of dollars in gambling revenue that are expected. The governor is currently running for the Republican Party’s 2024 presidential nomination.
The deal lets the Seminoles take in sports wagers from mobile devices anywhere in the state, with the wagers being processed through the tribe’s servers located on tribal land.
Seminole reservations already offer casino gambling, but adding sports betting to the tribe’s business portfolio could generate $20 billion over 30 years, according to an NPR report.
The casino operators say the governor and the state legislature broke the law when they agreed to the pact because a 2018 amendment to the Florida Constitution does not permit gambling outside of tribal territory without a public vote.
But the constitutional amendment contains a provision stipulating that the prohibition on casino and sports gambling does not apply to “the conduct of casino gambling on tribal lands” pursuant to compacts approved under the Indian Gaming Regulatory Act (IGRA), a federal statute.
The casino operators say in their application that the deal gives the tribe the right to offer online sports betting throughout the state, including at locations outside of tribal lands, “so long as the sports bets are received by servers located on the Tribe’s lands.”
“The Compact provides that all bets placed by persons ‘physically located in the State but not on Indian Lands’ shall be ‘deemed’ to have been placed ‘exclusively’ on the Indian lands of the Tribe.”
Under this “deeming artifice,” the compact “seeks to use the IGRA exception to the Florida constitutional prohibition to give the Tribe a monopoly to offer online sports gaming everywhere in Florida.”
In a legal challenge to the deal under the IGRA, a federal judge in the District of Columbia ruled the deal was illegal, but in June the D.C. Circuit Court reversed, ruling in favor of the tribe.
The casino operators urged the nation’s highest court to act because doing so would be good “public policy,” according to their application.
The Circuit Court’s decision “will upset the status quo in Florida by permitting the Tribe to conduct online sports gaming throughout the State, even though the Florida Constitution prohibits any such gaming absent a citizens’ initiative, and UIGEA [the federal Unlawful Internet Gambling Enforcement Act] prohibits use of the internet to transmit payments between a jurisdiction where gambling is illegal (Florida) and one where it is legal (the Tribe’s land).”
Without a stay, the company will spawn “hundreds of thousands, if not millions, of sports betting transactions that violate both state and federal law before this Court has the opportunity to address the merits.”
The Circuit Court opinion works “a dramatic change in public policy on legalized gaming that, once started, may be difficult to stop.”
“It is in the public interest to preserve the status quo with respect to online gaming until such time as this Court has a chance to review Applicants’ petition for a writ of certiorari,” which the casino operators have promised to file.
The Epoch Times has reached out to the attorney for West Flagler Associates, Hamish Hume of Boies Schiller Flexner in Washington, and to the U.S. Department of Justice for comment.
