By Dara Kam ©2023 The News Service of Florida
TALLAHASSEE — After a federal appeals court ruled against them, two pari-mutuel companies on Tuesday asked the Florida Supreme Court to strike down part of a multibillion-dollar deal that would give the Seminole Tribe control over sports betting throughout the state.
The challenge, filed by West Flagler Associates and Bonita-Fort Myers Corp., alleges the deal runs afoul of a 2018 constitutional amendment requiring voter approval of expansions of casino-style gambling. West Flagler holds three jai alai licenses, while Bonita-Fort Myers Corp. does business as Bonita Springs Poker Room in Southwest Florida.
Gov. Ron DeSantis and Seminole Tribe of Florida Chairman Marcellus Osceola, Jr. signed the deal, known as a compact, in 2021 and state lawmakers ratified it.
A “hub-and-spoke” plan in the agreement allowed the Seminoles to accept sports wagers from mobile devices anywhere in the state, with the bets run through servers on tribal land. The deal said bets “using a mobile app or other electronic device, shall be deemed to be exclusively conducted by the tribe.”
The lawsuit filed Tuesday at the Supreme Court accused DeSantis and the Legislature of exceeding their power by allowing sports betting off tribal lands — without approval from voters.
“This abuse of authority warrants this court’s review and correction,” Raquel Rodriguez, a Miami-based attorney with the Buchanan Ingersoll & Rooney PC firm, wrote in the 76-page lawsuit known as a “petition for a writ of quo warranto.”
The challenge pointed to part of the constitutional amendment that says it “ensures that Florida voters shall have the exclusive right to decide whether to authorize casino gambling” in the state. The amendment includes an exception for gambling that takes place on tribal lands.
“The amendment is an enduring grant to the people themselves – and only them — to authorize new gambling in Florida. The constitutional provision should be interpreted for sports betting as it exists today,” Rodriguez wrote.
The amendment, known as Amendment 3, applies to types of gambling found in casinos and to types of gambling that are considered Class III under federal law. A presentation by DeSantis’ lawyers to Florida lawmakers in 2021 noted that, “because of Amendment 3, commercial sports betting outside of a tribal compact is unconstitutional in Florida.”
The lawsuit accuses DeSantis and legislators of constructing the sports-betting plan and an accompanying law in a manner designed to skirt the constitutional requirement for a statewide vote.
DeSantis and lawmakers “sought to bypass” and “avoid the requirements” of the amendment “not by actually limiting sports betting to Indian lands, but by labeling the problem away. But the Florida Constitution cannot be so easily avoided,” the lawsuit said. “The governor and Legislature’s fiction does not change the reality that the governor and Legislature are seeking to authorize gambling that takes place off Indian lands.”
The lawsuit called the setup deeming wagers placed anywhere in the state to have occurred on tribal lands — where the computer servers handling bets would be located — a “transparent artifice” to try to meet the exception in the amendment.
“This artifice to avoid (the amendment’s) requirement of a citizens’ initiative is contrary to established law, the undisputed facts and common sense,” Rodriguez argued.
The state lawsuit came as the pari-mutuel operators also seek a U.S. Supreme Court review of the compact in a separate federal court case. That case alleges the compact violates the federal Indian Gaming Regulatory Act, or IGRA, which regulates gambling on tribal lands.
U.S. District Judge Dabney Friedrich in 2021 ruled against the compact, calling the sports-betting plan a “fiction” and invalidating other parts of the agreement. But a panel of the U.S. Circuit Court of Appeals for the District of Columbia overturned Friedrich’s ruling, and the full appeals court this month refused to reconsider the panel decision.
The pari-mutuels filed a motion saying they intended to ask the U.S. Supreme Court to weigh in on the issue, arguing that the outcome could “represent a blueprint for expanded gaming outside of Indian lands.”
The Seminoles briefly rolled out the Hard Rock SportsBook mobile app amid the legal wrangling but stopped accepting wagers and deposits on the app in December 2021 after Friedrich’s ruling.
The pending cases will keep sports betting in Florida in limbo, at least for now.
“Do I think online sports betting will ultimately be allowed under the compact? It’s probably a better than 50 percent chance that the Seminole Tribe will end up .. having the ability to roll out online sports betting. But the key question for today is one of timing,” Daniel Wallach, an attorney who specializes in gambling law, told The News Service of Florida on Tuesday. “What is known is these parallel judicial proceedings will likely cause further delay in the timing of the rollout of online sports betting.”
Isadore Havenick, an owner of the pari-mutuels whose family has operated gambling facilities in Florida for more than 60 years, also is a plaintiff in the lawsuit filed Tuesday. The case argues the federal appellate rulings have resulted in an “urgent” situation necessitating state Supreme Court review.
“Unless this (Florida Supreme) Court grants this petition, casino gambling throughout the state in the form of off-reservation in-person and mobile sports betting will take effect without the approval by the voters of Florida, as explicitly required by the text of Article X, Section 30 of the Florida Constitution. … Further, since the current status of the case is that the 2021 compact is valid under federal law, review of the legality of off-reservation sports betting under state law is urgent,” the lawsuit said.
The challenge also pointed to the June 30 decision by the three-judge panel of the federal appeals court. While the decision was a major victory for the Seminoles and the state, the panel also emphasized that questions about whether the compact violates the Florida constitutional amendment remain a matter for state courts to consider.
“Whether it is otherwise lawful for a patron to place bets from non-tribal land within Florida may be a question for that state’s courts, but it is not the subject of this litigation and not for us to decide,” appeals-court Judge Robert Wilkins wrote in a 24-page opinion joined by Judges Karen Henderson and J. Michelle Childs.
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