Florida Sports Betting Drama Between Seminoles and Pari-Mutuels Continues

Two Florida pari-mutuel operators have accused the Seminole Tribe of being dishonest with the court, which is why they urged a court to shut down the request from the tribe for a stay of a ruling that struck a gambling deal down. The gambling deal allowed sports betting to take place in Florida.

An Emergency Motion Was Filed by The Tribe

Last week, the tribe filed an emergency motion in which it asked the US Circuit Court of Appeals for DC to stay the ruling made by US District Judge Dabney Friedrich, which challenged the deal and gave the tribe control of the state’s online betting market. 

On November 22, the decision by Friedrich was that Deb Haaland, the US Department of the Interior Secretary, made a mistake in allowing the compact to go into effect due to the fact that it is in violation of federal law. Moreover, the ruling by Friedrich rejected the motion of the tribe to intervene in the lawsuit in any way and have it dismissed. 

A panel of the appeals court which consisted of three judges, gave the plaintiffs and the federal government until Tuesday noon to come up with a response to the Seminole motion. The plaintiffs in the case are the Magic City Casino (Miami-Dade County) and Bonita Springs Poker Room (southwest Florida) owners. 

Pari-Mutuel Facilities Challenge the New Compact 

The chairman of the Seminole Tribe Florida, Marcellus Osceola, Jr., and Governor Ron DeSantis announced in spring this year that an agreement had been reached on the compact, and it was approved by lawmakers of the state during a session in May. But the lawsuit that was filed against Haaland, as well as her agency, stated that the plan on sports betting is in direct violation of the Indian Gaming Regulatory Act (IGRA), which lays the foundation of gambling on tribal lands.

Pari-mutuel operators argued that the compact is unlawful in a document that was filed on Tuesday. Not only that, but they viciously critiqued the tribe for continuing to offer online sports betting services even though the deal was vacated with the ruling made by Friedrich. 

In a response that contained 29 pages, the plaintiff’s lawyers stated that the tribe hasn’t been sincere with the court over the “irreparable harm.” On one side, it told the court that it could lose millions of dollars in revenue absent an emergency stay, but a week after the ruling was made, it continued to tell customers that its online sports betting platform remains operational and that they don’t have to worry about anything. 

An email from a Seminole lawyer was also pointed out in the response. The email indicates that it is unknown whether the sports betting operations of the tribe will be shut down if the appellate court upholds the ruling of Friedrich.

Joe Webster, a Seminole lawyer, wrote a message to the lawyers of the plaintiffs on Monday in which he said that the council of the tribe would evaluate the available options after the decision by the DC circuit is reviewed. 

In the Tuesday response, plaintiffs also went after the contention of the tribe that they are an indispensable party to the lawsuit and that the reason why the case should be dismissed is that the Seminoles have sovereign immunity. 

Plaintiffs elaborated by saying that the legal arguments of the tribe for reversing the judgment of the court aren’t attempting to defend the compact’s legality. Instead, they want to entirely block judicial review, and if they are accepted, the arguments will abandon all legal surveys of all Interior endorsements of IGRA compacts. 

The response went on to say that if any harm comes to the Seminole Tribe, it will be self-inflicted as it was aware of the gaming’s unlawful nature from the start. It also pointed out the fact that the tribe rushed to launch its online sports betting platform on November 1, even though a hearing case was scheduled on November 5. 

The decision that Friedrich made against the compact revolved around gamblers being able to wager on sports online from any location in the state, with the bets being run through servers located on properties by the tribe. Friedrich wrote that over a dozen IGRA provisions regulate gambling in no other location aside from Indian lands. That is why it is crystal clear that the Secretary of the Interior Department must outlaw any compacts that violate the terms stated by IGRA. The compact deems betting on sports to take place at the tribe’s servers, which is a fiction that cannot be accepted by the court. 

Friedrich rejected these arguments by stating they are “an indispensable party” and made the decision that its sovereign immunity wasn’t implicated in the lawsuit as the federal government made a mistake by applying federal law and allowing the compact to go into effect. 

The Tribe Fires Back With a Lot of Tools 

Seminole’s appeal focused on its sovereign immunity from a majority of private lawsuits and accused plaintiffs of trying to evade by deciding to go after the government instead of the tribe. As a court document that was filed last week states, Seminoles spent over $25 million on its sports wagering app, and it plans to spend an additional $20 million by the end of 2021. 

The tribe is also making a massive effort to make sure that rival gaming companies do not get any provisions on the 2022 midterm ballot. 

This effort has been labeled as one of the largest in the history of Florida politics, and it includes paying more money than usual to petition gathering firms in exchange for signing exclusivity deals. Some of those deals were obtained by POLITICO, and they include campaign-style advertisements on TV and an informal side petition that is organized by a convicted fraudster on voting. 

And if that is not enough, numerous petition gatherers were interviewed and revealed that workers are being paid by the tribe to interfere with the petition gatherers. A spokesperson for the Seminoles was asked about the blocking effort, and the answer was that the tribe had assembled the best political consultants in the country. As Gary Bitner, Seminole’s spokesperson explained, the team will oppose multiple outside interests who have invested around $60 million in PAC money to fight the success of the tribe. He also added that all workers who engage in inappropriate behavior would be let go. 

The attempt by the Seminole to “poach petition gambling firms” is run through Cornerstone Solutions, a company that was founded by Rick Asnani and is based in West Palm Beach. Asnani has been involved with consulting jobs for the company and is currently the chair of two political committees that are associated with the blocking efforts of the Tribe. One of those is “Standing Up for Florida” – a company that has paid upwards of $5.5 million since it was founded in September. 

One of the ballot measures that oppose Seminole is supported by DraftKings and FanDuel, and it allows sports betting throughout Florida, not just through the tribe. 

Pari-Mutuels Claim That They Will Lose a Lot of Money

As pari-mutuels stated in their Tuesday response, the result of the tribe offering online sports betting services will cost them increased expenses, lost revenue, and profits, as well as increased competition. That is why their lawyers urged the appellate panel of three judges not to impose a stay on orders made by Friedrich. They wrote that the compact would result in the creating of a gambling scheme that is in direct violation of federal laws, and it will include bettors as accomplices in those violations. 

The Department of the Interior responded to the motion of the Seminoles to stay and said that even though it doesn’t oppose the motion, it doesn’t agree with the presented analysis. 

Friedrich noted that Seminole is a required party in the lawsuit but decided that its interests could be adequately protected by the federal government and added that if the case is dismissed, which is something that the tribe wants, plaintiffs would be deprived of any way to challenge the compliance of the government with federal laws.

Lawyers of the Interior Department made it clear that the federal government is generally the one and only required and indispensable party in a legal matter to federal agency action. Rachel Heron, an attorney of the Environment & Natural Resources Division of the Department of Justice, wrote a 10-page response on Tuesday in which she stated that a contrary rule comes with the risk of the courthouse door on myriad challenges to government action to be closed.