Place Your Bets: Blurring the Line Between Sports Wagering and Fantasy Football

November 9, 2014

Uncategorized

By Geea Atanase – Thompson Rivers University 2L JD Student

In 1992, the United States passed the Professional and Amateur Sports Protection Act (PASPA) (also known as the Bradley Act), which federally bans sports betting with the exception of sports lotteries in Oregon, Delaware, and Montana, as well as licensed pools in Nevada. States that had operated casinos for ten years prior to the introduction of the Bradley Act were also given one year to pass laws legitimizing sports betting, but New Jersey, which is home to the infamous Atlantic City, failed to pass such laws.

Until now, that is.

Governor of New Jersey Chris Christie recently approved legislation that allows state licensed casinos and racetracks to offer sports betting to patrons, and for the state, the new law could not have come at a better time. Revenue from gambling at the once sparkling Atlantic City is close to half of that in 2007, and the rapid closing of casinos has led to cuts to thousands of jobs. The legitimization of state-sponsored sports wagering could breathe some much-needed life into a struggling economy, and in the past, state senators from Iowa, Rhode Island, and Missouri have attempted to repeal the PASPA as well. In fact, New Jersey State Senator Raymond Lesniak filed a lawsuit in 2009 claiming that the PASPA unconstitutionally discriminates against all but the four states that allow sports betting, which led to voter approval of a repeal of the Act.

Although dissatisfaction with the PASPA appears to be widespread, both professional and amateur sports leagues have a different story to tell. The NCAA, NFL, NBA, MLB, NHL, and other leagues filed a motion to stop New Jersey from offering sports wagering, citing the conflict with the PASPA as the reason for seeking the injunction. The onus was on the leagues to show that they would suffer ‘irreparable damage’ if the state expands sports betting, and they were granted the injunction on this basis.

Although the NBA and NFL refused to comment, ESPN gambling writer David Purdum has stated that the leagues have been fighting against a repeal of the PASPA for several years, and they fear that the expansion of sports betting will hurt the integrity and credibility of their respective sports. However, proponents of the PASPA repeal argue that the legitimization of sports wagering can only help the integrity and credibility of sports in the US.

Would the expansion of sports wagering to include placing bets at casinos and racetracks truly cause irreparable damage to the integrity of sport? Not likely. Between 1984 and 2013, casinos in Nevada recorded $64.4 billion on sports bets, and since 1989, the total amount won on football bets is just over $1.1 billion. Purdum noted in an interview on ESPN that only about 1% of the money that is bet on sports in the US is wagered legally in Nevada; given that Nevada has already raked in billions of dollars on sports betting, the potential for other states to follow suit (should sports betting become legal) looks promising.

Additionally, when the NFL sought an injunction in 1976 to prevent Delaware from allowing casino patrons to bet on football games, Judge Stapleton found no “threat of immediate irreparable injury” to the NFL and refused to grant the order. Rather than tread on the integrity of sport, expanding state sanctioned sports wagering would funnel some of the illegally bet money into state economies and add some legitimacy to practices that occur with or without legislative approval.

Interestingly, the NFL wholeheartedly supports sports wagering when the league is able to claim a piece of the pie. Forbes estimated that people in the U.S. spent $15 billion playing Fantasy Football in 2013, and while the NFL does not directly claim revenue from that amount, it is still able to capitalize on this form of sports betting in other ways. More than half of those who take part in fantasy sports report watching significantly more games, buying more tickets and spending more money at stadiums.

Additionally, in 2006, the NFL entered into a $600 million deal with Sprint in order to allow football fans to use their phones to monitor drafts, and recently, the New England Patriots entered into a partnership with DraftKings, a fantasy sports website. As Marc Edelman at Forbes also notes, the lines have blurred between fantasy sports and sports gambling: “TradeSports has begun to allow users to compete head-to-head based on their ability to predict a number of ‘yes or no’ bets based on a single NFL game – something that sounds similar to head-to-head parlay betting. The NFL has not uttered a public word about this.”

It seems obvious that the NFL is less concerned with ‘irreparable injury’ to the league and the integrity of sport than it is with maintaining a monopoly on a market from which it stands to gain. As Edelman also notes, the NFL’s fight against the expansion of sports betting in New Jersey misses the mark if the league actively endorses Fantasy Football and implicitly endorses other forms of online betting. In the future, perhaps the NFL should put its money where its mouth is and pursue legal action against those who truly threaten the league with ‘irreparable injury.’

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