Justices Unclear on Power Divide in N.J. Sports Betting Case

Photographer: Ron Antonelli/Bloomberg

• Justices unsure how far federal government can go in directing state laws

• At issue is N.J’s attempt to repeal its ban on sports betting

• Case has broad implications for controversial policies like marijuana legalization


Justices seemed unsure during oral argument at the U.S. Supreme Court Dec. 4 how to resolve the clash between the federal government and New Jersey in the Garden State’s attempt to capture some of the billions of dollars bet on sports each year.

At issue is New Jersey’s attempt to repeal part of its state ban on sports betting in an effort to revive the struggling Atlantic City region.

A lower court ruled that the partial repeal violated the federal Professional and Amateur Sports Protection Act of 1992, which prohibits states from “authorizing” gambling related to professional and amateur sports leagues.

New Jersey argued that the federal government can’t prohibit the state from repealing its own ban. That would violate the anti-commandeering doctrine, which says the federal government can’t conscript states into enforcing federal policy, the state argued.

But the federal government and the sports leagues challenging New Jersey’s repeal said the federal government most certainly can do that. It does it all the time when it preempts state laws that conflict with federal ones, they argued.

The justices, though, struggled with the distinction between permissible preemption and impermissible commandeering. Where is the line? Justice Elena Kagan wanted to know.

The answer to that question could have implications for other controversial policies like the legalization of marijuana, Justice Sonia Sotomayor suggested.

People, Not States

The federal government can’t prevent states from lifting their own bans on sports betting, New Jersey’s lawyer, Theodore Olson, of Gibson, Dunn & Crutcher LLP, Washington, told the justices.

The federal government is supposed to regulate people, not states, Olson said. That was one of the chief concerns of those at the constitutional convention, he said.

PASPA, though, regulates states, so its prohibitions can’t stand, Olson said.

Very Comprehensive

But the federal government regulates states all the time though preemption, Justice Ruth Bader Ginsburg interjected.

It’s true that state law can be preempted to the extent that it is inconsistent with federal law, Olson said.

But in order to be inconsistent with federal law, the federal government has to actually enact a policy that regulates the targeted activity, he said. That’s not what happened with PASPA, he said.

Instead, that law is just a straight command to the states to prohibit sports betting, without enacting any federal policy on the subject at all, Olson said.

Couldn’t the total prohibition on sports betting be seen as the federal government’s policy, Chief Justice John G. Roberts Jr. asked. Viewed that way, it seems like the federal government has enacted a very comprehensive policy that could preempt inconsistent state laws, he said.

Blurs Accountability

Instead of focusing on preemption, Kagan homed in on the proper application of the anti-commandeering doctrine.

Impermissible commandeering only happens when the federal government conscripts the states to act, Kagan said. Where’s the conscription here? she asked.

The New Jersey legislature is being told by the federal government that it can’t regulate sports betting, Olson said.

Well that just sounds a lot like preemption, Kagan said.

But Justice Anthony M. Kennedy countered that the state is being required to obey a state law that it doesn’t agree with.

Justice Samuel A. Alito Jr. noted the federal government could do that—namely, make New Jersey follow a law it didn’t agree with—if the federal government just passed a national law prohibiting sports betting.

By failing to do so, the federal government placed the expense and burden of criminalizing sports betting on states, Olson said.

Moreover, it blurs which government—state or federal—to hold accountable if voters disagree with the policy on sports betting, Kennedy said.

Odd Method

PASPA does impose a nationwide ban on sports betting, with some exceptions for places like Nevada, Paul Clement, of Kirkland & Ellis LLP, Washington, said. Clement argued on behalf of the sports leagues challenging New Jersey’s repeal.

PASPA does so by prohibiting both states and private individuals from engaging in sports betting, he said. The provision prohibiting states from authorizing sports betting—the provision at issue in the case—is simply a case of classic preemption, Clement said.

That’s a pretty odd way to ban sports betting, Roberts said.

But that way leaves room for the states to adopt different methods of prohibiting sports betting, Jeffrey Wall, of the Justice Department, Washington, said. States can choose to make it a felony, to make it a misdemeanor, or to stay out of the process all together.

Broad Implications

No matter how the justices ultimately come out on the future of sports betting in New Jersey, the case could have implications for other controversial federal policies.

In particular, progressives have recently pointed to the anti-commandeering doctrine as a possible basis for maintaining sanctuary cities without losing vital funding and legalizing marijuana in the face of federal criminal statues.

In both cases, the federal government is trying to force the state to carry out federal laws, their supporters argue.

The case is Christie v. NCAA, U.S., No. 16-476, argued12/4/17.

To contact the reporter on this story: Kimberly Strawbridge Robinson in Washington at krobinson@bloomberglaw.com

To contact the editor responsible for this story: Jessie Kokrda Kamens at jkamens@bloomberglaw.com