Sports betting has been more or less banned in the states for nearly a quarter of a century. That could change drastically after the Supreme Court on Monday opened the door to make sports betting legal in any state that wants to legalize it.
In a 6-to-3 ruling, the justices said a federal law banning sports betting in most states is unconstitutional because it violates states' rights to make their own decisions.
“Congress can regulate sports gambling directly, but if it elects not to do so, each state is free to act on its own,” Justice Samuel A. Alito Jr. wrote for the majority.
Chris Krafcik of GamblingCompliance, an independent gambling analysis company, said this decision is “transformational.” It means some 20 to 40 states can and probably will soon move forward on creating their own sports betting markets worth an estimated $1 billion in annual gaming revenue.
The debate about sports betting hasn't affected only the people who like to throw down on horse races or football games. It folds in all sorts of fascinating policy and political battles, like: states' rights vs. the federal government; how conservatives balance moral objections to gambling vs. a desire for limited federal regulations; and the economy of entire states vs. the economy of major sports leagues.
Here's a step-by-step rundown of key moments in the debate on gambling in America that got us to this monumental one:
Congress banned sports betting in the 1990s. The winning argument was made by sports leagues such as the National Football League and the National Basketball Association. They said that if people can bet on sports, then players, officials and coaches could be tempted to throw a game to win a bet.
But the Professional and Amateur Sports Protection Act wasn't universally enforced. Nevada, which already had strong gambling powerhouse in Las Vegas, got a carve-out. And future exemptions were coming with the invention of daily fantasy sports leagues.
Congress also frequently tries to ban all online gaming. In 2006, it essentially banned online betting except for “skill-based” games, a highly subjective term.
Opponents to gaming continued to push for a full online gaming ban. One powerful backer of the ban is Sheldon Adelson, a mega-GOP donor and chief executive of Las Vegas Sands casino. (Adelson was in Jerusalem on Monday celebrating another big policy priority of his, the moving of the U.S. Embassy in Israel to Jerusalem.)
Leading conservatives, including former Republican congressman Jason Chaffetz of Utah, and some Democrats in Congress picked up the ban's cause on moral grounds.
“That is so offensive and wrong,” Chaffetz said of online gaming when he introduced a bill in 2015 to fully ban it. “When you’re a 7-year-old kid and there is no physical barrier, and all you need to do is get your iPhone.”
Prominent conservative thinkers such as Grover Norquist fired back that Chaffetz was helping the federal government regulate states, something that is anathema to conservatives' small-government governing philosophy.
Daily fantasy sports leagues emerge and muddy the waters even further. The online gaming ban has carve-outs for fantasy sports leagues, which have become a multibillion-dollar industry. *There's a debate about whether fantasy daily sports are even legal, but fantasy advocates point out that federal law banning online gaming explicitly has carve outs for daily fantasy leaves and fantasy sports are played in 41 states.
That fantasy football is thriving anyway is especially jarring to states that want their own sports betting industries. They've been frozen out by the major sports leagues from getting them, and now the leagues are openly championing something that looks very similar to sports betting.
The problem, Chris Grove, editor of LegalSportsReport.com, told The Fix in 2015, is that gambling law predates the Internet, which means these online and sports betting bans haven't been implemented consistently as technology has developed: “A lot of gambling law was written around the time of pinball machines and crane games.”
In the case of sports betting, that meant the power stayed with the sports leagues that got the ban on the books in the first place.
While the online betting debate rages, New Jersey challenges the sports betting ban. The Supreme Court case began in 2014, when New Jersey decided to repeal its own state ban on sports betting, too. The idea was to allow its fledgling casinos to open up horse betting tracks and draw more customers.
As Legal Sports Report's Dustin Gouker outlines well here, the NCAA and major U.S. sports leagues sued New Jersey, arguing the state was violating federal law. Over the next few years, New Jersey lost in federal court after federal court. The law in Congress said what it said: Sports betting (except in Nevada) was illegal.
Then came Monday.
The Supreme Court rules that Congress unconstitutionally banned states's ability to regulate themselves. Congress certainly can ban sports betting, just as it has banned, say, assault weapons in the past, argued the justices.
Alito argued that Congress never banned online gaming but, rather, threw a blanket prohibition on states to regulate themselves.
Alito wrote: “It is as if federal officers were installed in state legislative chambers and were armed with the authority to stop legislators from voting on any offending proposals. A more direct affront to state sovereignty is not easy to imagine.”
This doesn't mean that you can just walk into your closest casino and slap down $500 on Monday's Warriors vs. Rockets playoff game. The Supreme Court ruled that states can regulate sports betting, not that sports betting is suddenly legal.
But after a decades-long, confusing and often contradictory battle that tended to favor opponents of expanded gaming, sports betting supporters have gotten the last word.
*This post has been clarified to expand on the debate about whether fantasy daily sports are even legal.