Fight for future of American sports gambling officially begins in New Jersey courtroom

Dan Wetzel
Yahoo! Sports

Across three hours Thursday afternoon in a federal court in Trenton, N.J., the initial battle began in a long legal war over a potentially seismic shift in the way sports are consumed in America.

The dueling lawyers on each side of NCAA v. Christie presented initial arguments on the constitutionality of a 1992 federal law that effectively bans full sports wagering outside of Nevada.

New Jersey voters, legislators and its governor – the case's namesake, Chris Christie – have pushed to open full sports books in Atlantic City casinos and horse tracks across the state. They passed a law last year and planned on issuing licenses last month.

"If someone wants to stop us, then let them try to stop us," Christie declared last May.

Thursday they came to stop him, lawyers representing a parade of sports organizations (NCAA, NFL, NBA, MLB, NHL) as well as the United States Justice Department, who jumped in late last month.

It is a heavyweight fight, pairing off the Justice Department of President Obama against the government of Christie, who may well run to succeed him in 2016. Each side is employing a connected former U.S. solicitor general, rich legal teams and, with billions of potential dollars on the table, the expressed interest to take this to the bitter end.

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That likely means the Supreme Court. The loser of this initial decision – expected in a few weeks – will certainly appeal and the loser of that appeal will certainly appeal and so on. The case seems destined for consideration by the Supreme Court in 2015 or 2016.

The arguments Thursday, in front of U.S. District Judge Michael Shipp, centered not so much on the pros and cons of sports wagering but on things such as whether the Professional and Amateur Sports Protection Act (PASPA) unfairly grandfathered in four states, most notably Nevada, at the expense of others and also violated state sovereignty protected under the 10th Amendment. New Jersey argued that PASPA allows the feds to have it both ways, leaving regulation of sports wagering to individual states while attempting to enforce full prohibition.

"It can't instruct the states not to do it or else abandon it to Nevada or organized crime," former U.S. Solicitor General Ted Olson argued, according to the Associated Press.

Meanwhile, the leagues and the feds eschewed defending whether the statute made sense. Instead, it argued that no matter New Jersey's wishes, the PASPA is constitutionally sound, which is the only germane issue.

"The question is not whether gambling is a good policy choice for New Jersey or that the legislature didn't act in good faith," said U.S. attorney Paul Fishman. "It's that Congress and the president decided 20 years ago that the spread of legal gambling on college and professional sports is a bad idea and bad for the country."

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That law, however, has trouble standing on its own merits some two decades later. Gambling in all forms has exploded across America, and many of the basic tenants of the bill have proven weak in practice.

No one disputes that billions of dollars are wagered illegally each year in every state. It's unregulated and untaxed money, and the federal government itself acknowledges that the current profits go mostly into organized crime operations that use it to bankroll myriad other societal ills. Moreover, law enforcement has come to agree that its best tool against game fixing or point shaving are Las Vegas sports books which can, in real time, monitor unusual betting activity. There is no such mechanism to see how the line on a street gambling operation is shifting. And since gambling is so prevalent, there is no less interest in influencing games because people in New Jersey are going through a corner bookie rather than a licensed casino.

Finally, a partial prohibition makes little sense. If sports wagering is so terrible, why is it allowed in Nevada, as well as to a lesser extent Montana, Oregon and Delaware, the latter of which has only begun to employ primitive football betting cards.

Still, the various sports leagues cling to an outdated argument or cling to the concept that they don't like their games being used as bait. They stood up immediately to New Jersey last spring and filed suit by summer, only to be bolstered in January when the U.S. Justice Department decided to throw its considerable support into the defense of PASPA.

"We are pleased that the Department of Justice has joined us in articulating these arguments," Donald Remy, the NCAA's chief legal officer said Thursday.

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For sports in America this case could have profound impact. Should New Jersey succeed and be allowed to open Vegas-style sports books, then other states also eager for revenue will likely do the same. It'll be no different than the explosion in casinos nationally over the last two decades. You could see packed sports books for NFL Sundays and the NCAA tournament at the casino near you. Likewise small neighborhood betting parlors, the kind that are found on nearly every block in England, could spring up. Or betting slips could be offered at lottery outlets in convenience stores or bars. Online wagering will also push for legalization.

The sports gambling business that currently runs mostly through the mob would go public – tracked and taxed. Major multinational gaming outfits, from current American casino operators to European bookmakers such as William Hill are investing millions in the possible gold rush should Jersey succeed.

Time will tell on that. The feds and the leagues won't go down without a fight.

In a legal battle that could greatly influence the future of the sports fan experience in America, Thursday in Trenton was just the first volley.

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