Sports betting law suffers ‘major blow’ in New Jersey

A month ago, Jimmy Vaccaro was optimistic about the potential legalization of sports betting on a national level. But now his tune has changed.

New Jersey’s latest shot at legalized sports betting suffered a significant setback Tuesday, when the U.S. Third Circuit Court of Appeals upheld the prohibition of sports gambling in that state by a 10-2 vote.

“This is a major blow in New Jersey,” said Vaccaro, a Las Vegas bookmaker since the 1970s. “This is a monster smash in the head.”

The court ruled New Jersey would be violating the Professional and Amateur Sports Protection Act (PASPA), a federal law instituted in 1992 that prohibits all but four states — Nevada, Delaware, Montana and Oregon — from offering a form of sports wagering.

New Jersey’s attempt was opposed by the NCAA and all four major professional leagues.

The NBA joined the NFL, NHL and MLB in the fight against New Jersey’s efforts despite NBA commissioner Adam Silver repeatedly promoting the benefits of legalized sports betting. That does not mean Silver’s stance has changed concerning legalized wagering on a national level.

In late June, Vaccaro was in Washington, D.C., where he spoke on a panel at the Gaming Experts Forum hosted by the American Gaming Association. At the time, Vaccaro and some other industry insiders were optimistic the expansion of legal sports wagering could happen within five years.

The NHL’s move this summer to award an expansion franchise to Las Vegas, without requesting a betting ban on the team, was viewed as progress.

NFL commissioner Roger Goodell, when asked this spring about the Oakland Raiders’ possible relocation to Las Vegas, said the league had “evolved” on the gambling issue. Still, Goodell never has endorsed legal sports wagering.

New Jersey is expected to petition the U.S. Supreme Court to hear the case, which is considered a long shot. The more realistic next step is to work on repealing PASPA, but that could take three years or more.

“Washington has a responsibility to fix a failed law that it created nearly 25 years ago,” AGA president Geoff Freeman said in a statement released Tuesday. “A federal government prohibition has driven an illegal, and occasionally dangerous, sports betting market of at least $150 billion annually.”

The Nevada sports wagering handle for 2015 was $4.2 billion, and it is projected to approach $5 billion in 2016. It’s estimated that $150 billion to $400 billion is bet illegally in this country through underground bookmakers, offshore books and pools.

Joe Asher, CEO of William Hill US sports books, said in a statement the court’s ruling was “disappointing” and added, “It will be celebrated by illegal bookies all across New Jersey and the rest of America, as it keeps sports betting underground and on the black market for now. PASPA is clearly a failed law and more challenges to it are inevitable, both in the courts and in Congress.”

Meanwhile, the daily fantasy sports (DFS) business is making a comeback in New York and other states, and all of the pro leagues have business dealings in various forms with DFS companies.

This question needs to be answered definitively: Why are some states legalizing DFS while others are prohibited from offering sports wagering because of PASPA?

Contact sports betting reporter Matt Youmans at myoumans@reviewjournal.com or 702-387-2907. Follow on Twitter: @mattyoumans247