The Sports Betting Battle Begins in Florida

When Florida Governor Ron DeSantis negotiated the state's new compact with the Seminole Indian Tribe, he gave the tribe the exclusive right to control sports betting in the state. In return, the state of Florida is due to receive a substantial annual fee from the tribe. Some estimates put the proposed fee at close to $500 million.

When the U.S. Department of the Interior received the new compact for approval, they had up to 45 days to issue a ruling. They did not do so. In such cases, the new compact is assumed to be approved. That new compact is now in effect and there are plenty of interested parties that are not happy about it.

The Battle Begins

Upon news of the compact getting pseudo approval, a number of the top sports betting operators in America vowed to fight against the compact. In a significant move in that direction, both DraftKings and FanDuel each contributed an estimated $10 million to the Florida Education Champions political committee for the fight against the new gaming compact. Both companies have also become active proponents of a 2022 ballot initiative published by the Florida Division of Elections. The initiative would give professional sports venues and pari-mutuel facilities the right to secure sports betting rights in the state.

First things first. West Flagler Associates has filed a lawsuit on behalf of Magic City Casino and Bonita Springs Poker Room. The lawsuit alleges the state of Florida unlawfully granted the Seminole Tribe the right to operate sports betting operations outside of tribal lands. According to the lawsuit, that would be a violation of the Indian Gaming Regulatory Act (IGRA).

In answering this portion of the lawsuit, the Seminole Tribe claims that their external betting operations will be run over the internet with the computer processors residing on Indian land.

The lawsuit also levies the claim that the compact would violate federal law, and we quote, “unlawfully permitting internet and bank wire transmission of transactions and payments related to sports betting between the tribe’s reservations and the rest of Florida, where sports betting is otherwise illegal.”

Finally, the lawsuit claims that the compact would violate the Fifth Amendment of the U.S. Constitution by giving the Seminole Tribe a monopoly over sports betting in the state.

What Does This Mean for Sports Betting in Florida

Based on the agreement with the Seminole Tribe, a target date of October 15, 2021, was established for the start of sports betting in the state. Clearly, legal entanglements are going to keep that from happening. Furthermore, legal entanglements were expected.

With billions of dollars of sports betting revenue on the line over the next few years, the battle for the right to offer sports betting to the residents of Florida is going to be fierce. Recognizing that, it would be unrealistic to think anything is going to happen before the middle of next year. Given there is an election cycle in November of 2022, it's reasonable to assume nothing will get done until Floridians have their say.