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April 24, 2014

N.J. Moves Towards Legal Sports Betting This Fall, in Time for NFL Season

It appeared for some time last year as if New Jersey was about to become the first state to legalize and regulate online gaming in the form of poker. But Republican Gov. Chris Christie vetoed state legislation to that effect, citing legal and constitutional concerns.

Now, however, Christie has laid down the gauntlet to the U.S. Department of Justice on a different type of gambling – sports betting. In January, he signed legislation allowing sports betting in New Jersey after it was approved by a 2-to-1 margin in a nonbinding voter referendum in November 2011. And he announced on May 24 that he plans to go ahead and set up a system of wagering at the state’s racetracks and casinos this fall, before the National Football League season ends.

Christie was quoted as saying that he signed the bill in January in order “to boost our casino and horse racing industries, and encourage tourists to come here to Atlantic City.”

“We intend to go forward and allow sports gambling to happen, if someone wants to stop us, they’ll have to take action to stop us,” he said.

The governor was referring to the Professional and Amateur Sports Protection Act (PASPA), a 1992 federal statute that prohibits states from operating a gambling system based on professional or college sports. Only four states –Nevada, Delaware, Oregon and Montana, which already had this type of gaming in effect – were exempted. The NFL, the National Basketball Association, and other pro leagues are strongly opposed to legalized gambling, and the U.S. Department of Justice can be expected to consider taking legal action to stop New Jersey’s plan from going into effect.

In fact, State Sen. Ray Lesniak, a leading proponent of sports wagering in New Jersey, fully expects that the federal government and the NFL will try to prevent the system from going into effect.

Although this state action may face a significant legal challenge, a bill to legalize online poker in New Jersey that is now moving through the state legislature, if passed and signed by the governor, looks as if will be legally safe. Lesniak says he hopes that bill will be ready for the governor’s signature by the end of June. The bill was changed this year to meet the governor’s objections from 2011, and in addition, the U.S. Department of Justice has now expressed the view that the federal Wire Act does not prohibit online poker.

We support New Jersey’s efforts to legalize these types of gaming in the interests of helping its economy and giving residents and visitors a chance to enjoy this pastime and possibly even make some money.

© 2012 Ifrah PLLC

About the Author

Associate

Sarah Coffey is an attorney with the DC-based boutique Ifrah Law where she advises clients on issues such as gaming law, e-commerce, and FTC enforcement.    Sarah also advises government contractor clients in bid protests, SBA proceedings, and employment law matters including COBRA and ERISA disputes. Her criminal defense cases have included charges of mortgage fraud, marriage fraud, and military BAH fraud.

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