Page 18 - Delaware Lawyer - Winter 2023

FEATURE | FIRST STATE IN SPORTS GAMING
Constitution). The Court first found that there was no issue of material fact. This next point was key. The panel rea- soned that, as even the State conceded, Delaware intended to offer a broad ar- ray of sports betting on professional and college games, which were beyond the scope of what was offered in 1976. Ac- cordingly, the Court would go directly to addressing the merits of the case — whether what Delaware admitted it in- tended to do would violate PASPA.
The argument’s focus was the mean- ing of this language in the “grandfather- ing” exception of that statute: “to the extent that the scheme was conducted by that State or other government en- tity at any time during the period be- ginning January 1, 1976, and ending August 31, 1990.” Delaware’s argued that its “scheme” in 1976 should not be viewed as limited to the multi-parlay for NFL games that it actually did offer, or even “Scoreboard” (i.e., the multi- game parlay plus the other two games authorized but not offered). Rather, counsel contended that the “scheme” should be interpreted more generally as a sports lottery under State control. In other words, PASPA should not be in- terpreted as limiting Delaware’s author- ity to specific games or associated sports leagues. All that was important, so the argument went, was that the 1976 state law authorized a sports lottery. Plain- tiffs disputed that broad reading of PASPA’s language. Counsel argued that what was authorized or contemplated in 1976 was not relevant, but rather the sole focus of the Court should be on what was actually offered.
The Third Circuit agreed with the plaintiffs’ interpretation based on prin- ciples of statutory construction. The Court found the language in question to be unambiguous. Since it was undis- puted that no “single-game” betting had taken place from 1976 onward, un- der PASPA the only offering permitted was what Delaware had actually offered:
Joe Flacco (in his UD days) hands off to Omar Cuff (28) behind the blocking of Kheon Hendricks (70).
MARK CAMPBELL
16 DELAWARE LAWYER WINTER 2023
the multi-game parlay betting on at least three NFL games. Thus, no broad- er scheme involving any other game or league was allowed. The Court had spoken definitively, with time to spare before the start of the NFL season. Del- aware’s request for a rehearing before the full Court was subsequently denied.
Taking the Issue to the Supreme Court
In one final attempt to salvage legis- lation intended to help give fiscal relief to the First State, a petition for a writ of certiorari was filed with the United States Supreme Court. Delaware re- tained Virginia Seitz, a Washington, D.C. attorney raised in Delaware and a member of one of the state’s most prominent legal families. The leagues and NCAA hired another well-known D.C. attorney, Paul Clement, to op- pose the petition (he was later hired by these parties in Murphy). In early May 2010, the First State’s request was de- nied and the litigation was over. For the next eight years, Delaware was limited to offering the multi-game NFL parlay, a novelty in the U.S. (besides Nevada), but certainly not much of a tax-generat- ing enterprise.
The State’s economic condition
would eventually recover. And thanks to New Jersey's subsequent protracted litigation with the same antagonists Delaware faced and ultimate victory before the U.S. Supreme Court in Murphy in 2018, the opportunity to offer a broader range of sports gaming finally arrived.10 In fact, consistent with Delaware’s knack for being “first,” 22 days after that monumental decision, the State began offering full-scale sports betting at its three authorized casinos.11 The following week, New Jersey Gover- nor Murphy signed into law legislation allowing sports gaming at that state’s casinos and racetracks.12
In retrospect, a fair question to ask is why the decisive constitutional issue in Murphy — the Tenth Amendment’s anti-commandeering mandate — was not raised in Delaware’s earlier litiga- tion. The parties did not address the issue, nor is there any reference in the Third Circuit’s opinion. However, two observations are in order. First, Dela- ware did make a Constitutional argu- ment relating to statutory interpreta- tion and state sovereignty, citing the U.S. Supreme Court’s 1991 decision in Gregory v. Ashcroft.13 The State cited that opinion’s holding that absent a clear legislative expression to alter the