New Jersey Loses Next Round in Sports Betting Battle

A federal judge issued a permanent injunction last week blocking New Jersey racetracks and casinos from starting privatized sports betting under a new state law. New Jersey’s lawyer, Ted Olson (l.), says there is no “affirmative” action by the state, which permits it. But the case will likely be heard in an appellate court before the state’s sports-betting plan is pronounced completely dead.

New Jersey lost again in its effort to allow state racetracks and casinos to begin sports betting under a new state law. U.S. District Court Judge Michael Shipp made his temporary injunction permanent, putting an end to the case in his courtroom, but most legal analysts feel the state will have to take its case to an appellate court before getting a definitive ruling.

The state’s new sports-betting law was a reaction to rulings from an appellate court in New Jersey’s previous unsuccessful fight to overturn a federal ban on sports betting. The rulings said the ban only applied to sports betting regulated by the state and New Jersey could simply repeal its sports betting laws. New Jersey’s law now privatizes sports betting—with no state oversight—and allows it at racetracks and casinos.

The new law has been challenged by the major U.S. sports leagues and the NCAA, which also challenged the state’s attempt to overturn the federal ban.

Most observers didn’t expect Shipp, whose brother is a former NFL running back, to allow the state to move forward with sports betting. Reports say the state’s attorneys were already preparing for an appeals court hearing, meaning it could be up to six months before the state knows whether it can proceed with sports betting.

In some final arguments before Shipp, the leagues argued that the state is not following the former appellate court ruling and is not dropping all of its restrictions on sports betting since the state’s law permits it only at racetracks and casinos. The law also requires bettors to be 21.

The law also bans bets on college games taking place in New Jersey or played by New Jersey schools.

The leagues argue that the state is still setting conditions and regulations for sports betting by only allowing them in specific places and therefore has not really dropped its prohibitions on sports betting.

Theodore Olson, a former U.S. solicitor general, argued on behalf of the state government.

“What is prohibited is an affirmative act by state officials that says, ‘I am giving you the blessing to do this activity,'” he said. “And the state is not doing that.”

The state also argued that previous court rulings allowed the state to control the “contours” of the prohibition giving it the ability to set all the parameters.

Meanwhile, Monmouth Park racetrack has reportedly been ready to launch a sports book at the track. The track has partnered with UK Bookmaker William Hill, but track officials at the hearing said the track can only hold on for so long waiting for a decision.