Federal Government’s Next Move Unclear in Florida Gambling Fight



Seminole Tribe appealing decision that scrapped deal negotiated by DeSantis, tribal leaders

TALLAHASSEE – As the Seminole Tribe pursues a legal battle to regain control over online sports betting in Florida, the federal government has not decided whether to launch an appeal.

The Seminoles are appealing a decision by U.S. District Judge Dabney Friedrich, who last month scrapped a deal negotiated by Gov. Ron DeSantis and tribal leaders. The Legislature authorized the deal, known as a compact, in a May special session.

But the U.S. Department of the Interior, which was the defendant in the lawsuit filed by two pari-mutuel facilities, is holding its cards close to the vest about whether it intends to file its own appeal, according to a court document filed Tuesday.

“The federal government notes however that the period for filing a notice of appeal from the judgment below has not yet expired and a decision from the solicitor general on whether the federal government will file its own appeal from that judgment is still forthcoming,” wrote Rachel Heron, an attorney with the U.S. Justice Department’s Environmental and Natural Resources Division.. The government has until Jan. 22 to file a separate appeal.

The gambling compact gave the Seminoles control over online sports betting throughout the state and allowed the tribe to add craps and roulette to its existing casino operations. Also, the Seminoles would be allowed to add three casinos on their property in Broward County.

In exchange, the tribe pledged to pay the state a minimum of $2.5 billion over the first five years and possibly billions more throughout the 30-year pact.

The “hub-and-spoke” sports-betting plan in the compact was designed to allow gamblers throughout the state to place bets online, with the bets run through computer servers on tribal property. The compact said bets made anywhere in Florida “using a mobile app or other electronic device, shall be deemed to be exclusively conducted by the tribe.”

Citing a federal law known as the Indian Gaming Regulatory Act, or IGRA, Friedrich on Nov. 22 invalidated the entire compact, finding that Interior Secretary Deb Haaland, whose agency oversees tribal gambling, erred when she allowed the deal to go into effect this summer.

Although the compact deems sports betting to occur at the location of the tribe’s servers, “this court cannot accept that fiction,” Friedrich wrote. The judge also rejected the Seminoles’ requests to intervene in the lawsuit and have it dismissed.

The Seminoles quickly asked the U.S. Circuit Court of Appeals for the District of Columbia to block Friedrich’s ruling from taking effect. A day after a three-judge panel of the appellate court rejected the tribe’s request, the Seminoles stopped accepting wagers and deposits on the Hard Rock SportsBook mobile app. The Seminoles rolled out the mobile app amid the legal wrangling in early November.

While the appellate judges refused to block Friedrich’s ruling, it’s unknown whether they will allow the tribe to join the lawsuit to try to get it dismissed.

Meanwhile, Daniel Wallach, an attorney who specializes in gambling law, predicted that the solicitor general will “take a hard pass” on the federal government appealing.

“This case has all the hallmarks of an unsuccessful appeal, for several reasons,” Wallach told The News Service of Florida in a phone interview Wednesday.

In a brief defending Haaland’s decision to allow the compact to go into effect, lawyers for the Justice Department argued that “provisions in the compact reflect a permissible hybrid approach wherein gaming activity that occurs off of the tribe’s Indian lands is authorized under state law, and gaming activity that occurs on Indian lands is authorized by IGRA pursuant to the compact.”

But Wallach said that argument “is completely belied by the facts of the case” because the compact authorizes mobile and in-person sports betting and a state law implementing the compact authorizes sports betting “pursuant to the compact.”

“The hybrid approach that the Department of Justice has conjured up is flatly contradicted by both the compact and the state statute authorizing the compact, which make crystal clear that all the betting which is authorized under state law is only ‘pursuant to the compact.’ There’s no independent state statutory authorization for sports betting that’s untethered to the compact,” he said. “It’s all tethered and intertwined with the compact. … That assertion made by the Department of Justice in the supplemental brief was erroneous.”

As they passed the compact this spring, state lawmakers were primarily concerned about a different legal hurdle: a constitutional amendment approved by Florida voters in 2018 requiring statewide approval for expansions of gambling.

The measure, known as Amendment 3, requires that proposed gambling expansions be placed on the ballot through a citizens initiative, effectively taking away lawmakers’ control over major changes to Florida’s gambling footprint.

DeSantis recently told reporters he was surprised by Friedrich’s decision to vacate the entire compact, while saying he anticipated that the sports-betting provision would wind up in court.

“We understood that that would be something that would be challenged, although I will tell you, we were not anticipating it to be a challenge under federal Indian gaming law. We thought the challenge would come under the Amendment 3,” he said on Dec. 9. “But at a minimum, the compact was clearly negotiated with the understanding that the hub-and-spoke could be something that would run into trouble at some point and so was structured in a way to allow the compact to go forward.”

The outcome of the Florida case could have far-reaching impacts, according to DeSantis.

“There’s a lot of Indian tribes around the country who are looking at this decision saying, whoa, that was not something that was good. You do not throw out the entire compact over this one issue. I think we’ll win on this issue eventually but you do not throw out the entire compact. So we’ll do what we need to do,” he said. “This could impact operations across the country. And that’s why I think you will see people across the country saying that this … decision needs to be reversed in some respect, and I think that will happen.”

But Wallach said it would be difficult for the federal government to ask the appeals court to reinstate the compact without the sports-betting provision because the government’s lawyers never requested that Friedrich sever that provision from the deal.

“It is a fundamental principle of appellate practice that new arguments cannot be made on appeal,” Wallach noted.

This article is a reprint from ClickOrlando.com. To view the original story, share and comment, click here.


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