As States Seek To Expand Online Sports Betting, Federal District Court Invalidates Florida-Seminole Compact Permitting Sports Wagering Throughout Florida

• Published date: 03 December 2021
• Subject Matter: Media, Telecoms, IT, Entertainment, Sport, Gaming
• Law Firm: WilmerHale
• Author: Mr Matthew Benedetto, Brian K. Mahanna and Reade Jacob

On November 23, 2021, the US District Court for the District of Columbia invalidated a 2021 gaming compact between the Seminole Tribe of Florida and the State of Florida, which permitted mobile sports wagering throughout the state (the Compact). The court found that the Compact violated the federal Indian Gaming Regulatory Act (IGRA) and thus the Department of the Interior violated federal law by allowing the Compact to take effect. As states across the country consider proposals to launch online sports betting, including through partnerships with tribes, they will need to grapple with the complex question of how IGRA, a pre-internet gaming statute, governs agreements with sovereign tribes in their state.

In August of this year, the Seminole Tribe and the State of Florida entered into a compact, pursuant to IGRA, that permitted the Tribe to offer sports betting to any player located within the State of Florida, including to those placing bets off reservation. Florida's constitution prohibits sports betting and requires a 'citizens' initiative' to change state gaming laws.¹ In view of this statutory prohibition, the Compact classified all in-state wagers on sports events to 'be deemed . . . to be exclusively conducted by the Tribe at its Facilities where the sports book(s) . . . are located,' even those that are made 'using an electronic device' 'by a Patron physically located in the State but not on Indian lands.' See Compact at II(CC)(2). The Seminole Tribe and Florida submitted the Compact to the Secretary of the Interior as required by IGRA. Simultaneously, the Florida legislature passed a law implementing the terms of the Compact.

In August 2021, the Secretary of the Interior issued a no-action decision, thereby approving the Compact by default. In the no-action letter, the Secretary took the position that the Compact's language 'deeming' where bets occur fell within the authority of states and tribes to negotiate under IGRA the allocation of criminal and civil jurisdiction related to gaming, 25 U.S.C. 2710(d)(3)(c)(i)-(ii). The Secretary also opined that Congress 'crafted IGRA as a flexible statute that acknowledged tribal sovereignty, was enacted for the benefit of tribal economic development, and for promoting tribal-state cooperation.' The Secretary concluded that 'IGRA should not be an impediment to tribes that seek to modernize their gaming offerings, and this [Compact] aligns with the policy goals of IGRA to promote tribal economic development...