Gambling

Court Briefing Blasts Sports Leagues' Hypocritical Stance Against Legalized Gambling

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New Jersey is trying a new tactic in the fight to legalize sports betting in the state: pointing to professional sports leagues' partnerships with daily fantasy sports websites. The state argues that daily fantasy is in fact gambling and that this makes leagues' stance against legalized sports betting hypocritical.

Daily fantasy sports are online games in which participants wager real money on a collection of individual athletes' performances. The leagues and daily fantasy websites have routinely claimed that, because these games are skill-based and compile the outcomes of multiple events rather than single games, they are not technically "gambling." That claim is highly disputed, though, and many see this verbiage as merely an attempt to avoid being called hypocrites.

The leagues also claim that legalized gambling could threaten the integrity of their games, but this is also undermined by their partnerships with daily fantasy sites.

In a filing made to the 3rd U.S. Circuit Court of Appeals Wednesday, the New Jersey Thoroughbred Horsemen's Association, which wants to bring sports betting to New Jersey's Monmouth Park Racetrack, invokes the legal concept of "unclean hands," which calls out the partnerships between the National Basketball Association (NBA), the National Hockey League (NHL), and Major League Baseball (MLB) and daily fantasy sports sites FanDuel and DraftKings. The briefing doesn't pull any punches:

The Leagues secured an injunction from the District Court by hypocritically pretending to be guardians of the integrity of their games and their reputations. The record shows this claim is utter nonsense. In reality, the Leagues are nothing more than the NJTHA's business competitors. They are seeking (so far very successfully) to use the federal judicial machinery to preserve an unfair competitive advantage in the multi-billion dollar market for sports betting dollars. Using PASPA as their hammer, the leagues have fenced the NJTHA out of the sports betting market. Through this litigation, the Leagues are also intimidating others who may want to compete for a share of the same sports betting dollars that the Leagues seek to dominate, if not monopolize, for themselves.

The Leagues' contention that the 2014 Law threatens the integrity of their games directly conflicts with their full embrace of fantasy sports betting. Fantasy sports betting, because the winning bet is determined on the basis of the statistical point performances of individual players, offers a myriad of manipulative schemes by which players and bettors can "fix" the outcome of a fantasy bet, without even being noticed or without affecting the ultimate outcome or score of the game. Fantasy sports betting is so ubiquitous that the "point shaving" scandals that have long plagued basketball and football may pale in comparison.

 

Despite the ease in which players can alter their performances to "fix" who will win a fantasy bet, the Leagues are fully invested in fantasy sports betting businesses. They're "all in." The "gold rush" has begun.

The Leagues' lust for as much of the sports betting dollars as they can corner for themselves, by faking irreparable injury, is not victimless. It devastates Monmouth Park, its many employees, and the public.

In other words, leagues want to maintain their government-enforced monopoly over sports gambling action so they can continue raking in a share of the revenue. They fear being cut out of the pie by outside sportsbooks and casinos, so they're trying to keep gambling in those places banned. It's crony capitalism in its purest form. 

The state of New Jersey has been defeated in court numerous times in its efforts to legalize gambling over the past two decades—the most recent loss coming in November. The 3rd U.S. Circuit Court of Appeals will hear arguments in the case later this year.

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  1. “The leagues and daily fantasy websites have routinely claimed that, because these games are skill-based”

    They are.

    I’ve won two of the last hockey pools I’ve played in, and I’ve won or come in second in all of the last five or six fantasy football leagues I’ve played in–and the same people consistently win on fan duel.

    There were always two reasonable knocks against gambling. One was that the games were rigged so that the house would win–in fantasy, sports betting, and poker, you’re not betting against the house. You’re betting against other people–and the house just takes a cut from the winners.

    If New Jersey allows slot machines but not sports betting, then that’s basically indefensible.

    The other reasonable knock was that because there was no skill involved, it was impossible for people to gamble responsibly–and that may be true about slot machines. Meanwhile, I’ve talked to a lot of gamblers, and I’ve talked to a lot of investors, and while there are idiotic drunken gamblers in this world, there are also professional gamblers I’d rather back than some of the stuffed suits I’ve seen pontificate about investing.

    1. Also, sports betting takes skill as well. There are people who are tremendously gifted sports betters because they know so much about the subject that they’re very good at picking winners.

      It’s still gambling because there’s a degree of luck (a quarterback could have his leg shattered two minutes into a game, etc.), but sports betting is a game of skill as much as luck.

  2. In other words, leagues want to maintain their government-enforced monopoly over sports gambling action so they can continue raking in a share of the revenue.

    While there’s plenty of crony capitalism in sports, this argument is weak. Sports leagues have been against legalized gambling long before fantasy sports ever existed. And people aren’t going to stop playing one because the other is legal. I don’t think this factors into the equation at all. The sports leagues have a legitimate reason to be concerned about the perceived integrity of their sports. But laws shouldn’t exist to make sure that NFL players aren’t throwing games. At least nothing more than basic laws against fraud and violation of contracts.

    Whether or not gambling involves skill or is random doesn’t matter, either. The ban on it stems entirely from Christian morality. Modern proponents are a mixture of conservatives and the types who want to protect people from their own poor choices.

    1. “Modern proponents are a mixture of conservatives and the types who want to protect people from their own poor choices.”

      I think it’s progressive notion, which, of course, originally had evangelical momentum behind it.

      And the progressives don’t like evil corporations casinos profiteering off of the working poor.

      That’s why the question of whether players are playing against each other matters, and that’s why the question of skill matters, too. If the evil corporation wins no matter how good you are, then it’s nothing but exploitation to the progressive’s mind.

      …and that’s why they’ll make exceptions for lotteries, which are run by the state. There may be no skill involved, and you may be playing against the house rather than each other–but at least the proceeds are going to finance poor children with big sad bunny eyes rather than a corporation.

  3. The state of New Jersey has been defeated in court numerous times in its efforts to legalize gambling over the past two decades

    How does the issue wind up in court? Doesn’t NJ make its own laws?

    1. I don’t see a link to the case, but I’d be interested in whom is suing them, too.

      Is it a concerned citizens group?

      Maybe it’s the casinos in Vegas that don’t want the competition? Local Indian casinos?

      I bet there’s some bootleggers and Baptists in that deck of cards somewhere.

  4. Something, something…Pete Rose.

  5. This is really not high on the list of my libertarian hopes. Sure, all gambling should be legal, but I really don’t give a shit about sports betting. I’d rather get non-violent drug users out of prison than this.

    1. Is it an either/or proposition?

      1. In Re Harry Falcon:

        How do you respond to the folks who say: “I don’t use drugs. My sons is not in jail. Why should I give a damn if the government restricts dope dealers’ freedom to earn a living? It’s not my ox.”

        Does that argument not apply to a-holes who say: “I don’t gamble. My son doesn’t work in a casino. Why should I give a damn if the government limits degenerate gamblers’ freedom to earn a living? It’s not my ox.”

        1. It’s just a query of priorities. Sports gambling should be legal, but it’s pretty far down on my list. Maybe stop killing people overseas I’ve never met first.

          1. Assuming state agents will murder innocent civilians, I’d rather the victims be folks I’ve never met who live overseas — as far as possible from my home and family. Sure, technically, all such murders are immoral and unjustified but, as you said, it comes down to priorities.

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