Off the reservation

Florida Gov. Ron DeSantis

A precedent-breaking Seminole sports betting contract is too much for the court to stomach. By David McKee

lorida’s Seminole Tribe and Gov. Ron F DeSantis gambled heavily—and lost—on a new tribal compact, one that included an incendiary provision for online sports betting. The compact allowed Internet-based wagering, including for private-sector casinos— provided that it was run through servers on Seminole reservations. In addition, any non-tribal gambling hall had to pay the Seminoles a 40 percent rake of the proceeds of online sports betting.

This compact leaned predominantly on the assumption that a cyber-bet placed anywhere in the Sunshine State would qualify thusly as “tribal gaming,” effectively extending the Seminole reservations throughout Florida’s ether. The compact contained other, generous provisions for the Seminoles, including the right to build three new resort-casinos in Hollywood, Florida, and to offer craps and roulette for the first time (provided that the tribe turned a blind eye to off-reservation blackjack, a longtime sore point).

Perhaps dazzled by the $6 billion payday promised over the 10-year life of the compact and by having succeeded in two years where predecessor Rick Scott had failed in eight, DeSantis ignored the state constitution’s Amendment 3, which specifies that any new form of gambling in the state must be approved by popular vote. That riled up opponents of the compact but not nearly as much as the sports-betting provision did.

In a David vs. Goliath scenario, Magic City Casino and Bonita Springs Poker Room took on the U.S. Department of the Interior over its approval of the compact. Actually, the Interior Department did not actively approve the compact but simply let the 45-day review period pass without action, perhaps knowing it had a legal hot potato on its hands. This was more than the small casinos could abide and they, along with prominent anti-gamers, sued.

The Biden administration tried to defend the compact but was so disorganized in its presentation that Judge Dabney Friedrich chastised them for their

The Secretary must reject compacts that violate IGRA’s

terms.” Analyzing Friedrich’s ruling, gaming-law expert Daniel Wallach told the Tampa Bay Times, “The avalanche of legal authority was on the side of invalidating online sports betting. She “ recognized the obvious – that a customer located in Jacksonville or Key West or Pensacola is not on Indian land when they initiate the wager.”

lack of preparedness. Then, on November 22, she dropped the gavel on the Seminoles and Interior Secretary Deb Haaland. The notion of “tribal lands” extending infinitely into cyberspace was, she decreed, a “fiction.” Wrote Friedrich, “over a dozen provisions in [the Indian Gaming Regulatory Act] regulate gaming on ‘Indian lands,’ and none regulate gaming in another location. Indeed, if there were any doubt on the issue, the Supreme Court has emphasized that ‘[e] verything—literally everything—in IGRA affords tools... to regulate gaming on Indian lands, and nowhere else.’”

In her own words, Friedrich ruled that the Florida constitution “provides that the state may expand sports betting only through a citizen’s initiative or an IGRA gaming compact. And because no citizens’ initiative has approved online sports betting, such betting can be lawful in Florida only if it is authorized by a gaming compact.’’

Chastising Haaland, the judge continued, “The Secretary must reject compacts that violate IGRA’s terms.” Analyzing Friedrich’s ruling, gaming-law expert Daniel Wallach told the Tampa Bay Times, “The avalanche of legal authority was on the side of invalidating online sports betting. She recognized the obvious—that a customer located in Jacksonville or Key West or Pensacola is not on Indian land when they initiate the wager.” Noting that Michigan, Connecticut and Arizona permit tribal sports wagering, so long as it takes place on tribal lands, Wallach added, “the state of Florida and the Seminole Tribe were operating in a state of delusion.”

DeSantis quickly moved to put distance between himself and his compact, conceding that reservationsin-the-ether was “an unsettled legal issue. We anticipated that this could happen.” He even suggested the state might go the constitutional route and put it to the voters, although he has precious little time to qualify such an initiative for the 2022 ballot (ditto all the rival OSB operators whose ballot drives are having a great deal of difficulty collecting signatures).

Both the Seminole Tribe and the Interior Department vowed to appeal, although Interior may face an uphill climb, having failed in its case to sever the OSB provisions of the compact from the rest. As a consequence, Judge Friedrich tossed the whole thing and ordered the Seminoles to revert to the terms of their 2010 compact. Out also went $70 million in revenue-sharing fees with the state, predicated on the 2021 compact, and the $25 million the Seminoles had spent to set up their OSB infrastructure. They asserted, in their appeal to Friedrich, that this constituted “irreparable harm” to their multi-billiondollar gaming empire.

The Seminoles paused taking sports bets for a few hours—then started accepting (illegal) wagers again, in defiance of Judge Friedrich. While doing so, the tribe brazened out a request to Friedrich that she stay her order. (She didn’t.) Plaintiffs’ attorney Hamish Hume opined to Casino.org, “They couldn’t meet the standards for a stay even if they stopped the online sports betting, but by continuing to offer it—and refusing to commit to cease if they fail to get a stay—they are being disingenuous and misleading to the court.”

What’s next? DeSantis is making noises about severing the OSB provisions from the rest of the compact and resubmitting it. He professed not to have read Friedrich’s 22-page edict but his press secretary, Christina Pushaw, did and said she found it “perplexing,” pregnant with “appealable issues.” Replied Wallach via the newspapers, “The state filed an amicus brief, and the tribe filed a motion to intervene. While they may be perplexed by it, it’s even more perplexing why they signed this compact.”