By T. D. Thornton
The so-called smart money is robustly bullish about the near-term prospect of legal sports betting in America.
That point was made resoundingly clear by a panel of gaming industry attorneys, strategists, and executives who spoke at a National Press Club media briefing on Friday in advance of Monday’s oral arguments before the Supreme Court of the United States (SCOTUS) to decide Christie v. National Collegiate Athletic Association.
The landmark case will have far-reaching reverberations within the Thoroughbred industry because the showdown in the nation’s highest court between the state of New Jersey and America’s collegiate and professional sports leagues will either affirm or reject the constitutionality of the Professional and Amateur Sports Protection Act of 1992 (PASPA), which currently prohibits most state-sponsored sports gambling.
“My prediction is a New Jersey victory. I’m just still struggling with how sweeping the victory will be,” said Daniel Wallach, a Florida-based gaming and sports attorney who has been following the case closely as it has wound through the court system for the better part of eight years.
“I believe New Jersey will end up with sports betting at Monmouth Park Racetrack and any other participating casinos that want to have it by week one of the NFL season in 2018,” Wallach told the National Press Club audience. “And according to most predictions or historical results as to how fast [Supreme Court] decisions are turned around, we could be looking at sports betting in New Jersey by the [NCAA basketball] Final Four [in March].”
Wallach said he believes New Jersey will enjoy “first to market status east of Nevada for the time being.” But, he added, it’s not quite as clear how SCOTUS will tackle the “ultimate question” about whether or not PASPA is constitutional and how it affects other states.
The panelists largely agreed that the SCOTUS decision, which is expected within three or four months of Monday’s oral arguments, boils down to four likely outcomes: 1) PASPA is found unconstitutional; 2) PASPA is upheld; 3) A ruling is issued that applies to New Jersey only; 4) An extreme outside possibility that sports gambling is banned everywhere in America, including Nevada, so that all states are treated equally (this has been described by some gaming experts as the “nuclear option”).
So, Wallach postulated, will the ruling be “one that will largely only benefit New Jersey [and other states that might decriminalize existing gambling statutes], or will it be floodgates wide open?”
Regardless of what the ruling means elsewhere in the country, Monmouth Park is primed to pounce into action immediately on the heels of any favorable SCOTUS ruling.
Daniel Shapiro, the vice president of strategy and business development for William Hill US, the largest operator sports books in Nevada with locations at over 100 gaming properties, said at the press briefing that his firm already has a deal signed to operate a sports bookmaking business at Monmouth “as soon as it’s legal under state and federal law there.”
Shapiro (who, coincidentally, has a Thoroughbred background that includes several seasons working in the Monmouth press box about 15 years ago), added that “we built out a sports bar there that can be converted to a ‘book’ easily within weeks of any positive decision out of the Supreme Court.”
And even though Friday’s National Press Club discussion was not geared to a racing-specific audience, the talk yielded subtle clues about where and how gaming industry experts see racetracks fitting into the legalized sports wagering equation. To me, these were the three biggest takeaways:
1) If racetracks are granted sports betting on the basis that they are existing, licensed gambling facilities, it would be a mistake to try and hoard that status and keep in from expanding beyond the racetrack’s physical property.
“Not everybody lives within five miles of a casino or a racetrack. And I suspect that if sports gambling is rolled out and confined to brick-and-mortar [venues] only, at best you will see maybe 40% of the illegal market migrate over to legal, regulated markets,” Wallach explained. “I think from day one, it is absolutely essential that there be online and mobile gambling…. It could be in partnership with existing license holders, maybe it could be without them. [But] I think we need to go all the way here.”
2) If sports gambling is legalized, the first-to-market rush shouldn’t happen at the expense of having well-thought-out infrastructure in place to accommodate emerging, “next big thing” concepts, like in-game or in-race wagering.
Jake Williams, an Australian attorney who is the legal director Sportradar US, a global leader in sports data and technology, was asked by a National Press Club moderator to give one example of a foreign gaming industry mistake that he would recommend that U.S. entities avoid. He cited how in Australia, in-play betting is legal, but only for telephone betting. Yet because a typical phone betting transaction takes at least 90 seconds, Williams said that lag makes it unfeasible for customers to place time-sensitive in-game or in-race bets.
“The trajectory toward sports betting is going toward in-play; it’s going to micro-bets in real time. So I think that’s an important component,” Williams emphasized. “It’s one of those things that’s growing and growing and growing.”
3) The sports leagues that are defendants in the Supreme Court case–especially the NFL–have been largely silent about how they would be willing to partner and cross-market with bet-takers should sports wagering become legal. But it would be a mistake to think that means the leagues don’t actually have plans in the works for rolling out their own versions of sports betting.
“They’ve got to be ready for whatever decision comes through here. I can’t believe they’re just sort of sitting back. I would think some effort is going into either a state model or a federal model, and certainly a league model,” said Andrew Brandt, a former vice president for the NFL’s Green Bay Packers and the current executive director of the sports law center at Villanova University.
Similar to how the NFL has a “chief officer” for nearly every aspect of its business, Brandt said, “What about a ‘chief gambling officer’? Because they have to be prepared, and I’d be surprised if that’s not in the works. Maybe not under that heading, but someone very fluent in that area, and maybe from the [gambling] industry itself.”
For deeper background on the pros, cons, and unknowns about what America’s future sports betting landscape might look like if it’s entwined with the racing industry, check out Bill Finley’s TDN series from last week (parts one, two and three).
And in the spirit of a seasoned gambler looking for a “tell” to predict a final outcome, Wallach offered this parting advice: Within the first hour of Monday’s oral arguments, the types of questions that come from the Supreme Court justices will be the truest indicator of “how vulnerable PASPA really is.”
Early Key Race On Derby Trail?
Predicting the winner of the GI Kentucky Derby based on results through the first Saturday in December is pure folly. But prognosticating which particular preps might wind up as key races is a bit more realistic. A good case could be made for Saturday’s GII Remsen S. at Aqueduct being one of the deeper and stronger 2-year-old graded stakes we have seen so far in 2017.
Catholic Boy (More Than Ready), whose only loss was a fourth-place finish just 1 1/2 lengths off the winner of the GI Breeders’ Cup Juvenile Turf, aced his grass-to-dirt transition in the Remsen 4 3/4 lengths clear of the competition. He rated commendably mid-pack in mild traffic early on, remained engaged but not overly keen while edging closer to the frontrunners, launched into a measured three-wide bid three furlongs out, and responded gamely when finally set down for the drive turning for home.
The second- and third-place finishers in the Remsen will also bear watching: Runner-up Avery Island (Street Sense) got a bit of a learning experience, taking dirt in his face down near the inside while on hold and surrounded by rivals. He lacked an explosive finish as the 2.2-1 favorite, but stayed on well enough to believe he belongs with the upper crust of the division at this early juncture of the Triple Crown chase.
Vouch (Yes It’s True) ran a sensible, seasoned race in only his second career start, getting hung out four wide into the clubhouse bend before willingly settling into stalk mode and taking the first run at the dueling pacemakers midway through the far turn. He lasted for third.
Farther back in the pack, fifth-place Tap Rap Strike (Tapit) ran a much-better-than-it-looks effort in his second lifetime outing. He stumbled to his nose exiting the outermost post, settled toward the back of the pack, then made a prolonged run from the half-mile pole to the top of the stretch while four wide through the turn before tiring from his arduous journey.
I have always ascribed an elevated sort of old-school status to the nine-furlong Remsen, which once upon a time (before the advent of the Breeders’ Cup) carried a bit more clout as the traditional, final distance stakes of the year for top-level 2-year-olds on the East Coast.
Unfortunately, my gut feeling is not backed by statistical evidence in terms of producing Derby winners: Only three horses in the last 54 years–Thunder Gulch, Go For Gin and Pleasant Colony–have successfully parlayed the Remsen into a win at Churchill Downs on the first Saturday in May.