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Florida Sports Betting: Relaunch of Hard Rock App Imminent; Court Mulls Case

Bill Speros for Bookies.com

Bill Speros  | 12 mins

Florida Sports Betting: Relaunch of Hard Rock App Imminent; Court Mulls Case

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NEW SMYRNA BEACH, Florida - The return of Florida sports betting could happen as soon as this week, or be delayed indefinitely. The Seminole Tribe of Florida holds exclusive rights in the state based on 2021 gaming compact it made with the state. It operates the Hard Rock Bet app. 

The fate of the compact has rested in federal court for more than 2 years. The U.S. Court of Appeals in the D.C. Circuit last ruled on the case, which could end up in the Supreme Court.

The appeals court's decision to not re-hear the case last week was a major victory for the Tribe. A lower federal court judge must now reinstate the gaming compact that between the State and Tribe. The deadline to reinstate the compact was Monday. 

A three-judge appeals court ruled in favor of the U.S. Secretary of the Interior in June and against West Flagler Associates (WFA), the former owners of the Miami Magic City casino. WFA sought a rehearing "en banc" in front of all the judges on the appeals court. That request was formally denied on September 11. 

On Friday, September 16, WFA sought a stay in the return of sports betting in Florida from the same appeals court. It expects to file a petition for a writ of certiorari with the Supreme Court.

"We are weighing all options, including a possible petition seeking the Supreme Court’s review," said attorney Hamish Hume, who represents WFA, last week.

The decision to seek a stay could push any hopes of a launch back weeks, or more, due to the intricacies involved in the federal appeals process, notes Florida-based gambling attorney Daniel Wallach.

The D.C. appeals court decision overturned a ruling by a federal judge who threw out the gaming compact in late 2021. In May of that year, Gov. Ron DeSantis and Seminole Tribe of Florida Chairman Marcellus Osceola signed a 30-year compact that allowed for statewide mobile sports betting via the Seminole Tribe's Hard Rock betting app (It has since been re-branded to Hard Rock Bet). 

The Tribe is to pay Florida $500 million per year, $50 million of that coming from sports betting. 

WFA, which still owns the Bonita Springs Poker Room, claimed in its initial lawsuit that the sports betting component of the compact was illegal and would cause a "significant and potentially devastating impact" on their income. 

What's Next In Florida?

Florida Sports Betting: Relaunch of Hard Rock App Imminent; Court Mulls Case 3

When sports betting will return in Florida? The answer to that question depends on who you ask. The Seminole Tribe runs a tight ship. Spokesman Gary Bitner said the Tribe was "pleased" with the appeals court’s decision not to grant the full (en banc) rehearing. Bitner would not answer any questions about a possible return date.

Messages to other top-level Hard Rock officials have gone unanswered. The Hard Rock Bet app now includes terms of use for people in Florida. The Tribe has been seeking new employees at its Florida casinos, and to work on the sports betting app site.

A spokesman for Gov. DeSantis told Bookies.com last Tuesday a decision to relaunch sports betting remains up to the Tribe and added on Friday that there's "nothing stopping them" from implementing the compact. 

The legal challenge to sports betting in Florida under this deal centered around the so-called "hub-and-spoke" approach. Under the compact, the Tribe has a monopoly on online and mobile gaming. It would use servers based on Tribal lands (the "Hub"). However, those over 21 located anywhere within the state are able to wager (the "Spoke"). 

Once the compact is officially re-instated, there is no longer any legal obstacle preventing the Tribe from relaunching sports betting, or the rest of the agreement.

In addition to sports betting via the Hard Rock Bet app and at its casinos, the compact permitted roulette and craps in the Seminole Tribe’s casinos. It calls for the Tribe to work out licensing deals with at least three parimutuel license holders to operate retail books. And it allows the Tribe to place betting kiosks off site at places such as Hard Rock Stadium in Miami Gardens.

The Tribe currently has casinos in Okeechobee, Coconut Creek, Hollywood, Immokalee, Clewiston, and Tampa. The compact allows them to open "three additional facilities" east of its Hollywood Reservation.

U.S. Supreme Court Decision Looms 

Florida attorney and Shepard Broad College of Law professor Bob Jarvis has long said the Tribe will not bring back sports betting as long as the case lingers in federal court. Jarvis said they also won't relaunch the Hard Rock Bet app if there is a lawsuit filed at the state level and a judge grants an injunction for it to stop. The Tribe will be satisfied with playing out the process, Jarvis said.

"There would be no upside to the Seminoles starting and then having to stop their operations and lots of downside (including possibly angering the Supreme Court)," Jarvis told Bookes.com Monday. 

Jarvis sees following scenario playing out. 

  • WFA will file a petition for certiorari with the U.S. Supreme Court likely by early October
  • The U.S. Supreme Court will deny the petition likely by the end of the year
  • The Seminoles will restart the Hard Rock app following SCOTUS' disposition of the case
  • WFA will file a lawsuit in Florida state court challenging the Seminoles’ right to do so based on Amendment 3 (now Art. X, sec. 30 of the Florida Constitution)
  • The state court case will be eventually dismissed and the Seminoles will finally then be able the Hard Rock app for good

"This could go fast or take a year or two depending on how far up the appeals ladder the state case goes," he said. 

Wallach believes the Supreme Court might take up the Florida case because of the impact it carries elsewhere. Wallach told The News Service of Florida last week that the case "checks at least three of the boxes indicative" of a Supreme Court review:

  • The decision is "in conflict" with rulings from other federal appellate courts
  • It's "arguably in conflict with the Supreme Court’s own precedent" 
  • It involves an "important question of federal law that has not been, but should be settled," by the Court

Again, the issue is whether or not the "hub-and-spoke" wagering is taking place on or off Native American lands. Wallach said at least eight other appeals courts have determined that IGRA does not apply to "to off-reservation tribal gaming activities." 

"This is obviously an important question of federal law, as it affects relationships between tribes and state and local governments across the country. It also impacts non-tribal gaming operators since tribal control of statewide remote wagering would dramatically alter the competitive landscape for digital gaming," Wallach told The News Service.

What Florida Sports Betting Could Look Like

Florida Sports Betting: Relaunch of Hard Rock App Imminent; Court Mulls Case 1

Florida will be the largest state in the country with legal sports betting if/when it returns. More than 21.78 million people live in Florida. That is nearly 2 million more than in New York. 

The exit of one GOAT - Tom Brady - has given way to the arrival of another - Lionel Messi.

Messi's deal with Inter Miami is for 2 1/2 seasons and pays him between $50 million and $60 million annually — putting the total contract value between $125 million and $150 million in cash alone. He will also be given a stake in the club. His arrival capitulated Inter Miami into the soccer spotlight.

With just one betting app, the online consumer market in Florida will be somewhat less competitive than it is elsewhere. The Hard Rock app met with generally positive reviews in the Sunshine State. It offers similar odds to its competitors elsewhere. The app currently operates in Arizona, Indiana, New Jersey, Ohio, Tennessee, and Virginia.

Florida has two MLB teams, two MLS clubs, three NFL franchises, two NHL squads, and two NBA franchises. The state has long been a college hotbed, thanks to the University of Florida, Florida State, and the University of Miami. Both the "U" and Florida Atlantic University reached the NCAA Men's Final Four in 2023. 

The compact requires the Tribe to franchise betting retail, on-site betting rights to at three of the state's parimutuel operators. The parimutuel operators would be free to partner with any operator to run their retail books, such as DraftKings, FanDuel, and BetMGM. In return, the operators would pay the Tribe 40% of their net winnings.

Sports bettors in Florida enjoyed 34 days of state-wide betting in 2021 when the Hard Rock app was up and running across the Sunshine State. Unless you happen to be Calvin Ridley, it was great to be in a state where not only was sports betting legal, but you could go to the beach on Christmas Day without freezing to death in the process.

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How We Got Here

Two groups filed suit against the compact in federal court after the Compact was signed in 2021. The app shut down after Judge Dabney Friedrich ruled in November that the compact violated the Indian Gaming Regulatory Act because it allowed wagering to occur off property owned by the Seminoles via the betting app (i.e. anywhere in Florida). She cited the "hub-and-spoke" set up, calling it "fiction." 

In its three-judge ruling, the D.C. Appeals court overturned her ruling. It determined that the compact satisfied the requirements of the Indian Gaming Rights Act and that the lower court erred in nullifying it. The compact was never formally approved by the Department of the Interior. It took effect after the DOI took no action on it after a 45-day review period. 

"The District Court erred by reading into the Compact a legal effect it does not (and cannot) have, namely, independently authorizing betting by patrons located outside of the Tribe’s lands. Rather, the Compact itself authorizes only the betting that occurs on the Tribe’s lands; in this respect, it satisfied IGRA. Whether it is otherwise lawful for a patron to place bets from non-tribal land within Florida may be a question for that State’s courts, but it is not the subject of this litigation and not for us to decide," the Appeals court said its June ruling.

The West Flagler group claimed the compact caused a "potentially devastating" impact on their casino and poker businesses. The "No Casinos" group said the compact violated the state's constitutional prohibition on gambling expansion off Native American lands without a referendum.

"Tribes all over the country now will run to their state counterparts and ask for mobile gambling. Thus, as big as sports betting has been in the five years since the U.S. Supreme Court struck down PASPA, as the old saying goes, 'you ain't seen nothing yet,'"  Jarvis told bookies.com after the appeals court ruling in June.

The Department of the Interior appealed. The appeals court heard the case in late 2022 and issued its ruling at the end of June. Monday was the deadline for West Flagler to file its en banc appeal. The company sold the Miami Magic City Casino for an estimated $600 million to the Poarch Band of Creek Indians from Alabama in February.

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What Are The Obstacles To Florida Sports Betting?

Florida's largest state budget ever - $116.1 billion - took effect July 1. And not a single penny of that record spending spree came from Florida sports betting revenue.

Many in the legal community and some of those who supported the gaming compact as written and passed knew that the “hub-and-spoke” approach to sports betting was a long shot at best. The Appeals Court found that it was. But the court said the plaintiffs could bring a case in state court. However, it is unlikely the State Supreme Court would overturn a deal brokered by DeSantis and passed by the legislature involving the Tribe.

Amendment 3, passed in 2018, prohibits the expansion of “casino gambling” in the state of Florida without 60% approval from the public in a statewide election. It says nothing about “sports betting,” which was legalized nationwide by the Supreme Court after the Amendment was originally drafted. 

Amendment 3 bars the legislature from enabling any new casino gambling – save for a compact with the Seminole Tribe.

It's impact on sports betting has yet to be fully adjudicated. 

In one of the great ironies in this tale, nearly all of the funding to pass Amendment 3 came exclusively from Disney and the Seminole Tribe. Both of those entities now are in the lead float of the sports betting parade.

Disney-owned ESPN will be launching its own ESPN Bet-branded sports book in the fall. In a $2 billion deal, PENN Entertainment replaced the Barstool Sports brand with ESPN Bet at its mobile and retail books across 16 states starting in the fall.

Push By DraftKings, FanDuel Proved Costly

Florida Sports Betting: Relaunch of Hard Rock App Imminent; Court Mulls Case 2

While the 2021 gaming compact between the Seminole Tribe and Florida languished in federal court, a group called Florida Education Champions pushed to get a measure on the 2022 state ballot legalizing mobile and on-site sports betting.

It was doomed from the start, given that the signature gathering did not begin until June of 2021 during COVID. DraftKings and FanDuel spent more than $36 million on the quixotic effort and the initiative fell more than 370,000 signatures short of the number needed to get on the ballot. The next such effort could come in 2024.

The Tribe remains free to begin retail or limit mobile on-site sports betting on Native American lands – meaning inside the Hard Rock Casinos – at any time.

The compact as passed shuts out other betting providers. A unified effort between DraftKings, FanDuel, BetMGM, Penn/Barstool, Caesars Sportsbook and others would be the wisest path to follow if these providers ever hope to enter the lucrative Florida market.

The failed measure backed by DraftKings and FanDuel has rolled over into the 2024 election cycle. But the signature-gathering effort has reset to zero. Initiatives must receive 891,589 verified signatures to get on the Florida ballot, with a minimum number required in 14 of the state’s 27 congressional districts.

Florida’s monstrous FY 2023-24 state budget includes a 5.38% pay raise for all state employees, bonuses to law enforcement officers, a $15 minimum wage for state workers, new higher base wages for teachers, and multiple tax holidays. The funding includes $31 billion in federal revenue Florida received this year.

The total is slightly higher than the current budget and 20% more than the last pre-pandemic spending plan passed in 2019.

In other words, Florida is flush with cash. That in part helped DeSantis roll to re-election by nearly 20 points in November of 2022.

The argument that “Sports Betting Is Good For The State’s Bottom Line” and “It’s Needed To Fund Education” fell flat in 2022 and could well fall flat again in 2024.

Especially in a presidential election year that could include both Donald Trump and DeSantis in a nasty GOP primary.

About the Author

Bill Speros for Bookies.com
Bill Speros
Bill Speros is an award-winning journalist and editor whose career includes stops at USA Today Sports Network / Golfweek, Cox Media, ESPN, Orlando Sentinel and Denver Post.