Are Garden State Park’s Standalone Sportsbook Plans In New Jersey Busted?

Posted By Bill Gelman on September 12, 2019

The odds of the first standalone sportsbook opening at Garden State Park this football season are not very good.

Actually, the odds of the New York Giants winning the Super Bowl (+10,000) seems like a safer bet at this point.

Judge Renee Marie Bumb issued an opinion last week, and it didn’t go in the favor of developer Cherry Hill Towne Center Partners LLC.

The main issue centers around a “restrictive covenant” put in place by the defendants GS Park Racing and Greenwood Racing:

“In this action, Cherry Hill Towne Center seeks a declaration that the Restrictive Covenant is unenforceable, and asks this Court to permanently enjoin GSPR from enforcing the restriction. GSPR has responded by filing a Motion for Preliminary Injunction asking this Court to enjoin Cherry Hill Towne Center “from and against opening and operating a sports wagering lounge or engaging in the business of sports wagering at or within the GSP Property.” [Proposed Preliminary Injunction Order, Dkt. No. 17-9].”

In laymen’s terms, Cherry Hill wanted to open a sportsbook on the site of the former racetrack. GS Park Racing, the firm that ran the racetrack, argued that the restrictive covenant that has been in effect since 1999 provides them (and only them) the right to offer gambling on the property.

As a result: “For the reasons stated herein, the Court holds that GSPR will likely prevail on its position that the Restrictive Covenant is enforceable.”

You can read the full document here.

What the restrictive covenant means for Garden State Park

When the restrictive covenant was put in place, NJ sports betting was a non-issue.

The Professional and Amateur Sports Protection Act (PASPA) prevented legal sports betting from taking place outside of Nevada. And it didn’t get overturned until May of last year.

So if that’s the case, shouldn’t the covenant be limited to horse racing and wagering? After all, no other form of legal gambling previously took place at GSP.

But in the document, Bumb said all forms of gambling are impacted:

“The Court finds the covenant unambiguous and not overly broad. The covenant can only mean exactly what it says.

“[W]agering activities . . . of any sort” must include sports wagering, because sports wagering is a “sort” of wagering. Moreover, Cherry Hill Towne Center’s argument concerning the legal context in which the covenant was made — i.e., that sports wagering was illegal at the time, therefore the parties could not have intended to reserve to GSPR a right to conduct an activity that was outlawed — cannot overcome the plain language of the covenant itself.”

In effect, Cherry Hill’s standalone sportsbook isn’t likely to happen any time soon.

Garden State Park’s sportsbook plans

The plans to add a sports betting facility to the former Garden State Park has turned into a saga.

When New Jersey passed its sports betting legislation in June of 2018, GSP was included in a loophole that allowed former racetracks the opportunity to apply for a sports betting license.

The latest court documents refer to the date June 22, 2018 (11 days after the Sports Wagering Act went into effect).

And according to the document, GSPR’s attorney sent Cherry Hill Towne Center a letter, via certified mail, concerning the restrictive covenant.

The letter stated: “GSPR is the beneficiary under that certain Declaration of Restrictive Covenants dated January 28, 1999. … You are an owner of property subject to the Restrictive Covenants.”

CHTC responded by filing a suit on June 31, 2018.

And all of these legal documents created a roadblock beyond repair.

What about that NJ sports betting partner?

Despite all of the court delays, Jack Morris, a controlling member of Cherry Hill Towne Center Partners, seemed to be moving forward with his plans.

In last month’s exclusive interview with Play NJ, Morris said they were “close” to naming an operating partner.

He went on to say: “Hopefully in the next week or two, we will be able to announce who that partner will be.”

That was mid-August.

There also is the small detail of getting approved for an NJ sports betting license. However, Morris, who is a partner in Hard Rock Atlantic City, is already licensed in the state.

Be that as it may, neither Cherry Hill Town Center Partners nor Morris had announced any sportsbook partner before Judge Bumb’s opinion.

Morris did not respond when reached for comment about the latest ruling.

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A Greenwood-Cherry Hill joint venture? Maybe not

So for now, the vacant space located behind the Zinburger will remain empty.

And there are no clues as to what will happen next.

Of course, there is always a what-if scenario. As in what if the two sides sat down at the table and found a way to work out their differences?

But based on the history of this case, that scenario seems highly unlikely. The document provides a clear reason why not:

“There can be little doubt that the parties’ interests are adverse. Even putting aside the parties’ vigorous litigation to date and their unsuccessful court-ordered mediation, the adversity of interests is apparent.”

The reality, however, is both parties are currently involved with sports betting in some form.

Greenwood operates Parx Casino in Pennsylvania and has a PA sports betting app up and running.

And there is a small possibility the Parx sports betting app could come to New Jersey. But the Kambi-powered platform needs an entry point via a land-based partnership.

At least publicly, neither side has mentioned the possibility of working out a mutual agreement. And any word about a Parx app in NJ is, for the most part, a mystery.

Does Cherry Hill need a standalone sportsbook?

Even if the parties reach some sort of agreement down the road, is there really a draw for retail sports betting in the middle of this commercial and residential complex?

The massive strip mall that includes Home DepotBest BuyBarnes & Noble and DSW does not offer any form of legalized gambling. Plus, it has been nearly 20 years since live horse racing took place on the property (May 3, 2001).

It’s not like Atlantic City where casinos are opening up 15,000-square-foot sportsbooks like the one at Bally’s Wild Wild West Casino.

Just on the other side of the bridge is SugarHouse Casino and Parx Casino in PA. Both properties have retail operations. And even the Meadowlands Racetrack and Monmouth Park offer live horse racing during certain months of the year alongside sports wagering.

Plus, players can currently make legal sports wagers from anywhere in Cherry Hill. There are now 17 NJ sports betting apps.

This includes Bet365 NJ, Unibet NJ, theScore Bet, and the rebranded Fox Bet, all of which went live this month.

So, if you want to take the Philadelphia Eagles minus 2 points versus the Atlanta Falcons on Sunday night while enjoying a slice of cake at the Cheesecake Factory, there are plenty of legal means to do it.

Meanwhile, the vacant retail space designated for sports betting will sit empty.

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Bill Gelman

Bill Gelman is a veteran sports writer based just outside of Philadelphia and not too far from the Jersey Shore. Bill spends time in Atlantic City writing about casino openings and expansions, special events and now NJ sports betting and online gambling.

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