All bets are off; federal judge tosses Florida’s new Gaming Compact

A federal judge in Washington has thrown out the 2021 Gaming Compact between Florida and the Seminole Tribe.

“The instant Compact attempts to authorize sports betting both on and off Indian lands. In its own words, the Compact authorizes such betting by patrons who are ‘physically located in the State [of Florida] but not on [the Tribe’s] Indian Lands,'” U.S. District Judge Dabney Friedrich wrote in an opinion issued Monday night.

For now, the Seminole Tribe’s Hard Rock Sportsbook app — the state’s first legal on-line sports betting platform — appears to be shut down from taking any more bets. Other functions on the app appeared to be working Tuesday morning, but not the Place Bet button.

The judge said the deal violates the Indian Gaming Regulatory Act and the compact should be vacated by U.S. Interior Secretary Deb Haaland.

“In the Court’s understanding, the practical effect of this remedy is to reinstate the Tribe’s prior gaming compact, which took effect in 2010,” Friedrich wrote.

The Interior Department in August approved the Gaming Compact, which appeared to be the broadest gambling expansion in Florida in decades. The deal had been negotiated by Gov. Ron DeSantis and approved in a Special Session in May.

The compact effectively legalized sports betting in Florida both through casinos and online, run by the Seminole Tribe, and the deal allowed for new casinos to be built.

The Seminole Tribe agreed to assure and increase its payments to the state, starting with $2.5 billion over the first five years. Some pari-mutuel establishments could close down their racing or jai alai operations and focus entirely on casino operations.

The deal had been heralded both by the Seminole Tribe and Gov. Ron DeSantis as a chance to generate billions in revenue for the state and increasing tourism, while allowing the Tribe to significantly expand its successful gambling operations.

But a case was brought against the compact by West Flagler Associates and Bonita-Fort Myers Corporation in August, with sports betting at the core of objections. The owners of Magic City Casino in Miami and Bonita-Fort Myers Corp. argued the deal and the implementing legislation both were based on a “fiction” sports betting could be deemed as taking place on tribal lands because bets will be accepted on servers and devices located on tribal lands, even though the betters are placing the bets elsewhere in Florida.

Magic City released a statement as its house won.

“Last night’s ruling was a victory for family-owned businesses like ours who pay their fair share in taxes and believe the free market should guide the business operations of gaming venues,” the statement read. “We would like to thank our legal team at Boies Schiller for their outstanding efforts. The judge clearly understood the blatant violation of IGRA as her ruling demonstrates. We look forward to working with the Governor, Legislature, and the citizens of Florida to pave a path forward that ensures a fair gaming marketplace exists in Florida.”

Friedrich opined that gave too much power to the Tribe.

“Because the State has not entered a similar agreement with any other entity, the Compact grants the Tribe a monopoly over both all online betting and all wagers on major sporting events,” the judge wrote.

Florida Education Champions issued the following statement on the decision.

“Our effort was always mutually exclusive from the compact. Florida Education Champions’ focus remains in securing the nearly 900,000 valid petitions to make the November 2022 ballot. Now is the time for all entities to come together so we may provide a competitive legal sports betting market for Floridians, while generating the expected hundreds of millions of dollars in annual revenues for the Florida Educational Enhancement Trust Fund,” said spokeswoman Christins Johnson.

Compact Opinion by Jacob Ogles on Scribd