The Supreme Court did not legalize sports gambling nationwide today, but it put the Country further down that track than it has perhaps ever been. In Murphy v. NCAA, the Court struck down the Professional and Amateur Sports Protection Act (“PASPA”) 28 U.S.C. §3702(1) as an unconstitutional commandeering of state legislatures. So, what does this mean? In short, the States are no longer barred from authorizing or licensing sports gambling within their borders.
PASPA is a 1992 act which forbade states from sponsoring, operating, advertising, promoting, licensing or authorizing a lottery or other gambling on competitive sports events. The Act grandfathered Nevada, Montana, Delaware and Oregon’s existing sports wagering schemes and allowed New Jersey one year to create one. The Act did not make sports gambling a federal crime, instead, it authorized the Attorney General or the sports leagues to bring a civil action to stop violations. New Jersey failed to act until 2012, when it passed a sports wagering law that was ruled in violation of PASPA by the District Court and the Third Circuit Court of Appeals. In 2014, New Jersey tried a different tactic by repealing its ban on sports wagering in certain places. Once again, the law was ruled in violation of PASPA by the Federal District Court and the Third Circuit Court of Appeals. However, this time, the Supreme Court agreed to hear the case to decide whether PASPA violated the Constitution’s prohibition against commandeering.
Basically, commandeering is when the Federal Government orders a state legislature to enact a law or otherwise carry out Federal mandate. This is prohibited under the 10th Amendment to the U.S. constitution, except for certain areas. New Jersey argued that PASPA was an unconstitutional commandeering of state legislatures by telling the states what laws they could NOT pass or modify (specifically their law banning sports gambling). The NCAA and other parties argued that PASPA was not commandeering, because it did not require that the states to take any affirmative action, rather it just forbade them from certain actions. The Supreme Court sided with New Jersey and ruled that PASPA is unconstitutional commandeering because it barred New Jersey from repealing or modifying its anti-gambling statutes.
This does not mean that sports gambling will now be legal across the country. It simply means that states are now free to legalize and regulate sports gambling if they wish. With governments looking for more and more means to increase revenue, it is expected that many states will take this opportunity to act. While Congress could try to pass a law that passes Constitutional muster, it seems unlikely that there is the support to do that and it seems that sports wagering is likely here to stay. Some states have already begun the process by passing laws that would authorize sports gambling if and when PASPA was struck down or repealed. Others have begun exploring such laws and we can expect that they will now move more quickly down that road. According to the AP, 13 states could join Nevada with some form of legal sports gambling within the next two years with 18 more states legalizing within the next 5 years.