With its refusal to re-hear a challenge to the Seminole Tribe’s gambling agreement with the state of Florida, a federal appellate court opened the door again this week to online sports betting in the state.

On Monday, the U.S Circuit Court of Appeals for the District of Columbia decided not to re-hear a legal challenge from two gambling competitors, Magic City Casino in Miami and Bonita Springs Poker Room in Southwest Florida, against Florida’s 2021 Compact with the Seminole Tribe that previously legalized sports betting on Tribal lands. The result is that the Seminoles could capitalize on a monopoly in online betting when the practice starts again, possibly in time for the Super Bowl and March Madness.

The state stood to make about $2.5 billion from the 2021 agreement, while the Tribe had complete control over the sports betting industry as residents began to download the Hard Rock Sportsbook mobile app late that year. But the operation only lasted about a month before the court challenge forced it to a halt.

Monday’s decision, however, means the industry can legally return, though the Seminole Tribe has not yet announced its plans for the launch.

Gary Bitner, a spokesperson for the Tribe, declined to comment on the “impact of the decision” but said in a statement that “The Seminole Tribe of Florida is pleased with the denial of the request for an en banc hearing by the U.S. Circuit Court of Appeals for the District of Columbia.”

The decision was only a matter of time, says Bob Jarvis, a law professor and gambling expert at Nova Southeastern University in Fort Lauderdale. He thinks online sports betting will resume as quickly as the end of the year, though further legal challenges could present some obstacles.

“We are certainly, inexorably moving closer to the day when we will have legalized sports betting in Florida,” Jarvis told the South Florida Sun Sentinel. “It is coming. It’s just a question of when it will be.”

Legal background

Though sports betting is now technically legal throughout the state of Florida, it still could face two different kinds of legal challenges that halt it again — though those would likely be temporary, experts say.

The agreement between Florida and the Seminole Tribe allowed people to place bets online from anywhere in the state, hinging on the idea that, as long as the servers were located on tribal lands, the betting was still technically occurring there and allowed under federal law.

The lawsuit filed by West Flagler Associates, which represents Magic City Casino and the Bonita Springs Poker Room, had disagreed with that premise.

The association sued the Department of the Interior, arguing that the department should have prevented the deal from going through because the bets are being placed off of tribal lands and therefore a violation of federal law.

A circuit court sided with West Flagler, but three members of the appeals court unanimously overturned that decision in June. But sports betting remained illegal. The group had asked the court to re-hear the case “en banc,” or with all of the members of the court present. The court denied that request Monday.

Technically, Monday’s action means sports betting is legal again and could return in weeks, not months. But the Seminole Tribe may decide to wait and see what their opponents plan to do rather than launch it, only to have it stalled again.

What’s next?

Two courses of action could still present obstacles, though they would just be delaying the inevitable, Jarvis said.

The first is to appeal to the Supreme Court, which West Flagler is likely to do and which would stop sports betting in its tracks yet again.

While some lawyers think the challenge has the markings of a Supreme Court case, others say the court would likely decide not to take up the case, a decision that could come as soon as the end of the year.

Daniel Wallach, an attorney who specializes in gambling law, said that the recent ruling “checks at least three of the boxes indicative” of a Supreme Court review.

“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,” he said.

But others said that the Supreme Court would not have any interest in such a case. The court typically defers to the administrative agencies, in this case, the National Indian Gaming Commission, said Michael Howard Wolf, a gaming attorney based in Fort Lauderdale.

“It would really have to be a serious departure from law for the Supreme Court to want to weigh in on it unless they think there’s some constitutional issue involved,” Wolf said.

Jarvis agreed, saying the Supreme Court will likely decline to consider the case by the end of the year. Even if the Seminoles were to lose in the Supreme Court, he said, all they would have had to do is go to Congress, he said, and ask them to amend the Indian Gaming Regulatory Act.

“The only thing West Flagler and its allies could do is slow down the introduction of sports betting in Florida,” Jarvis said. “They were never going to be able to stop, it because the Seminoles always had the cards, even in court, and if that weren’t to happen, in Congress.”

The second path is to challenge the issue in state courts based on a 2018 amendment to Florida law, known as Amendment 3, that requires voters to approve any further expansion of gambling in a statewide referendum. Opponents to the compact, such as the group No Casinos, have previously suggested they would pursue such a challenge.

However, any challenger would have to have legal “standing” in order to file suit, Wolf said, which could be an issue for lobbying groups like No Casinos.

Eugene Stearns, a Miami-based attorney who represented No Casinos in the circuit court case, told the gambling industry publication Vixio that his clients did not plan to pursue federal or state-level challenges.

Even if someone did pursue the state-level challenge, they would likely not succeed, Jarvis said, largely because the very amendment they’d base their challenge on was written and funded by the Seminoles and has an exception for Indian gaming, further allowing the tribe to monopolize the gambling industry in Florida.

Monday’s action could also have far-reaching implications for sports betting laws across the country, as other states look to Florida as an example in regulating the practice and drafting similar agreements with their own Indian tribes.

The idea that someone could place bets remotely and still technically comply with the rule that betting occur on Indian land could also soon lead to an expansion of remote gambling in general, not just sports betting.

“Eventually you will be able to sit in your home and bet, not just remotely on sports, but you’ll be able to use your iPad or cellphone to play roulette, to play craps, to play any kind of casino game you want, without actually having to go to a casino,” Jarvis said.

Of course, that greater access will also apply to compulsive gamblers.

“It will increase bankruptcies. It will have a devastating effect on some families,” Jarvis said. “But it;s just like prohibition. People are going to drink, you just can’t prevent it. It’s like trying to hold back a flood.”

Information from the News Service of Florida was used in this report.