New Jersey Considers Fighting For Lost Sports Betting Revenue From Sports Leagues

Posted on May 23, 2018

There has been a flurry of activity across the country as states prepare to tackle sports betting legislation. The US Supreme Court decision last week kicked slow-moving bills into high gear as the race to be first takes center stage.

While Delaware claims to be ready to accept sports bets any day now, New Jersey has been rushing to get a bill ready for a June 7 vote.

The state’s horse tracks and casinos are eagerly awaiting NJ sports betting legislation. That is not the only news coming out of the state though.

Stephen Sweeney, New Jersey’s State Senate President, wants restitution from the major sports leagues for legal fees and lost tax revenue.

Sweeney: ‘You cost us a lot of money’

New Jersey started the challenge to the Professional and Amateur Sports Protection Act (PASPA) back in 2011 when it passed sports betting legislation.

Since then, the state amassed more than $8 million in legal fees by some estimates. That’s not to mention the estimated lost tax revenue.

Now, the state wants its money back.

“I think we should be pushing back: ‘Look, you cost us a lot of money,” Sweeney said in an interview with NJ.com. “There’s a potential for the state of New Jersey to recover some real funds.”

Right now, Sweeney is the only one that’s talking. Gov. Phil Murphy and state Assembly Speaker Craig Coughlin haven’t weighed in on the topic yet.

Ideally, Sweeney would like to present a united front.

“We hold our strongest hand when the Legislature and the governor and the administration goes together,” Sweeney said.

Who else is seeking restitution?

The New Jersey Thoroughbred Horsemen’s Association is preparing a lawsuit that is seeking damages from the leagues, too. The association oversees horse racing in the state and is seeking at least $100 million in lost revenue since 2014.

Monmouth Park was in the center of the lawsuit when the leagues blocked the park from operating a sportsbook following a state law that would allow unregulated NJ sports betting.

Dennis Drazin, the operator of Monmouth Park and the future home of Monmouth Park Sportsbook by William Hill, believes the “leagues acted in bad faith.”

In substantiating that claim, he points to the NHL expanding into the Las Vegas market and the NFL moving a team there. Nevada is currently the only state with full, single-game sports betting operations. Drazin also notes that the leagues partnered with fantasy sports companies that at the very least appear hypocritical.

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Sports leagues are backing federal legislation

The major sports leagues started hedging their bets ahead of the Supreme Court’s decision. They began lobbying states to include an integrity fee into legislation that was under consideration.

The reception to this idea is mixed — except in New Jersey. Sweeney is very clear when asked about including an integrity fee in the Senate’s version.

“Absolutely not. They never got an integrity fee from Las Vegas. The Senate is not passing an integrity fee.”

Earlier this week, NFL Commissioner Roger Goodell came out in support of federal sports betting legislation.

“As it was for my predecessors, there is no greater priority for me as the commissioner of the National Football League than protecting the integrity of our sport,” Goodell said.

Sweeney isn’t buying it.

“This is how we got into the problem before,” Sweeney said. “I think what they didn’t come out and say is: ‘Congress created an opportunity to create a fund for us.’ They’re looking for money.”

The integrity fee has been a contentious issue. The leagues have yet to submit a clear plan on how the fees will protect the integrity of the game. There are varied opinions on whether the fee is necessary for this new climate of legalized sports betting or whether it is simply greed on the part of the leagues.

It is only week two of legal US sports betting, and the industry is changing by the minute. It is too early to predict the outcome of any potential lawsuit or whether federal legislation has enough support. Only time will tell.

Kim Yuhl Avatar
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Kim Yuhl

Kim Yuhl has been covering the US online gambling market since 2013. Her work is featured on various sites and covers sports betting, online casino gambling, and online poker. Kim is a full-time traveler and vlogger and is currently slow traveling to 60 countries. You can follow her travels at kimandway.com and on YouTube at kimandway.

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