Lawsuit in South Jersey Delays Opening of Sports Betting

While sportsbooks have been successfully open for more than a month in New Jersey, South Jersey residents who were hoping to have sportsbooks opened in their area will have to wait a bit longer, as an ongoing dispute in the region is holding up progress.

Sports betting in New Jersey

After the Supreme Court ended the federal ban on sports betting, New Jersey was one of the first few states to quickly push through legalization in its jurisdiction. This came as no surprise because it was New Jersey that had been spearheading the movement to have this decision made in the first place.

It only took a matter of weeks for the first sportsbooks to be launched, with many major international and domestic operators alike getting involved in the state.

It has taken the casinos in the area a while to fully embrace online gambling, which has been legal in New Jersey since 2013. While many of them did not see much point in it previously, those who have embraced it have thrived in the intervening years.

However, when online gambling was legalized, four of the 12 casinos in Atlantic City decided not to pursue an online gambling license. Of those four casinos that didn’t apply, three of them shut their operations down in the following 12 months. While it might not have been the main reason, it certainly didn’t help the long-term prospects of their business by not embracing the shift to online.

There has been an increase in the level of competition the smaller casinos can have now with the giants of the game, such as the MGM Group and Caesars, thanks to their online offerings.  They can bring more generous promotions and better odds to try attract more players.

FanDuel and William Hill have already launched their online sports betting offerings in the state. This brings the number of online gambling platforms in New Jersey to five: DraftKings, William Hill, FanDuel, playMGM and Play SugarHouse.

The well-known UK bookmaker William Hill is currently in charge of the Ocean Resort Casino and Monmouth Park sportsbooks. FanDuel, previously one of the leaders in the daily fantasy space, has paired up with the Meadowlands Casino for its sportsbook offering.

Sports betting revenues have been strong to date since legalization. The first sportsbook was opened on June 14 and up until the end of July, more than $57m (£43m) in sports wagers had been placed.

August saw another significant increase in sports betting wagers, with revenues of almost $96m (£73m). With the NFL and college football season resuming, September is set to top the August revenues.

Issues in South Jersey

The likelihood of sports betting coming to South Jersey any time soon is looking slimmer than ever. To date, only one party in South Jersey has received approval from the state to open a sportsbook.

The location in question is GS Park Racing in south Trenton, but an ongoing legal battle is preventing it from opening.

GS Park Racing is a group of gaming firms such as Greenwood Racing and the Parx Casino. They are facing a lawsuit filed by the Cherry Hill Towne Center Partners, which is the real estate developer that owns most of the Garden State Racetrack real estate.

The lawsuit is challenging the validity of a deed covenant that provides exclusive rights to have a better facility opened on the site of this old racetrack. Cherry Hill claims that GS Park Racing has been intentional in its refusal to open up a parlor for off-track betting, as it could be a significant competitor to their other ventures. As there is no end date on this deed covenant, the developer claims it is therefore invalid.

The developer also says that, either way, it should be allowed to offer sports betting there itself as it wouldn’t “have been contemplated” at the time of the deed being signed.

Away from Atlantic City, there are only five potential areas where sports betting premises could be opened. Those areas are the Atlantic City Race Course, Monmouth Park Racetrack, Meadowlands Racing and Entertainment, and Freehold Raceway. Cherry Hills is 58 miles from the nearest of these locations.

As well as there being a market in the area that is not currently being served, the state is also losing out on potential revenue in the form of taxes. This case will be next heard in court during October.