“The tribe’s online sports betting authorized by the compact is now in operation, and is generating millions in revenue per week,’’ said Marcellus W. Osceola, chairman of the tribe, in a statement filed with the court late Tuesday. “The tribe is using these funds to pay back the development costs for its online sports book, make revenue-sharing payments to the state and fund important tribal programs.”
A day after Judge Dabney L. Friedrich of the U.S. District Court in the District of Columbia ruled that the tribe’s sports betting and casino expansion deal violated federal Indian gaming law, the tribe filed a notice of appeal and a “motion for stay pending appeal,” asking Friedrich to tell it within the next 24 hours if she is going to put a hold on her own ruling.
Once Friedrich rules on the motion, the tribe can move forward and appeal the ruling.
In the 22-page motion for a stay, the tribe’s lawyers, Joseph H. Webster and Barry Richard, argue that the ruling will cause “irreparable harm” to the Seminole Tribe’s sovereignty and economic interests “if a stay is not issued pending resolution of the serious legal issues posed on the tribe’s appeal.”
Although its online sports betting operation has been active for less than a month, the lawyers said that the tribe would “lose substantial revenue” from online sports betting and that those revenues are “used in part to fund important programs for the tribe.”
In his statement to the court, Osceola said that the tribe has already made two $37.5 million revenue-sharing payments to the state under the compact, “hired scores of employees and purchased equipment in preparation to formally launch craps and roulette this month,” spent over $25 million to develop the online sports book, and hired more than 237 additional employees and vendors.
He argued that the tribe “would be irreparably injured if it is required to cease online sports betting pending the outcome of an appeal,” by losing millions in revenue and jobs.
In a news conference early Tuesday, Gov. Ron DeSantis said he expected an appeal but said he was not aware of the ruling and had not read it.
The governor indicated he was not aware that the entire compact had been invalidated, including the casino portion as well as the so-called hub-and-spoke model for sports betting. The compact required that all online sports bets go through the tribe’s servers from players located outside of tribal lands, an arrangement that the court said violates federal gaming law.
The governor admitted that the hub-and-spoke setup was “an unsettled legal issue” but said he hoped other parts of the agreement will withstand a challenge.
“We structured the compact so that the compact is preserved for the casinos and the other stuff,’’ he said. “So we’re going to still be getting revenue, obviously we’ll get less revenue from sports betting if they’re not able to do hub and spoke.”
DeSantis press secretary Christina Pushaw said in a statement to the Herald/Times that the state and the tribe were not a party to the case, which was brought by the owners of Magic City Casino and Bonita Springs Poker Room and a group of plaintiffs that includes No Casinos and Miami businessmen Armando Codina and Norman Braman.
For that reason, Pushaw said, “it is unclear what if any immediate impact the ruling has in Florida.”
“We are reviewing the court’s perplexing ruling, which certainly contains appealable issues,’’ Pushaw said. “... We look forward to working with the tribe to ensure the future success of the compact.”
Daniel Wallach, a Hallandale Beach-based sports lawyer and expert on gaming law, said he expects Friedrich to rule quickly on the tribe’s motion. If the judge rejects the request for a stay and the games are ordered to cease, she can enforce her own order by issuing an order to show cause requiring the tribe to come before the court and explain its actions.
Wallach said that by suggesting the state was not a party, Pushaw is attempting to sidestep the state’s pivotal role in the agreement.
“The state and tribe are not passive bystanders in this court case,’’ he said. “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.”
In her order late Monday, Friedrich suggested the state could reinstate the tribe’s prior gaming compact, and said that the governor and tribe may agree to a new compact, “that allows online gaming solely on Indian lands” or Florida voters could “authorize such betting across their state through a citizens’ initiative.”
Miami Beach Mayor Dan Gelber praised the ruling for upholding the intent of voters who approved a 2018 constitutional amendment that requires any expansion of gambling, such as the online sports betting, be approved through a statewide referendum.
“This opinion vacating the FL Gaming Compact validates Floridians’ intent to rest gambling expansions solely with them and not the Legislature or governor, whose attempt to thwart the will of voters and sidestep a clear constitutional imperative hit a brick wall,” he said.