Sports Leagues, Monmouth Park Racetrack Come to Agreement on 2014 Sports Betting Lawsuit

  • The dispute goes back to the leagues’ lawsuit against Monmouth Park in 2014
  • The leagues had to post a $3.4m bond, which Monmouth Park now wants paid out
  • Judge Freda Wolfson has accepted an agreement between the parties that will end the case
  • Monmouth Park originally sought $150m in damages after PASPA was struck down
lawyers shaking hands
In an agreement to end a 2014 sports betting lawsuit, the parent company of Monmouth Park Racetrack will stop pursuing the $3.4m bond put up when the five major sports league filed the legal action. [Image: Shutterstock.com]

$3.4m at stake

It appears that the legal saga surrounding the now-defunct Professional and Amateur Sports Protection Act of 1992 (PASPA) has come to an end. On Monday, US District Judge Freda L. Wolfson accepted an agreement between the New Jersey Thoroughbred Horsemen’s Association (NJTHA) – the parent company of Monmouth Park Racetrack – and the country’s five major sports organizations, settling their dispute over damages stemming from the leagues’ 2014 lawsuit against the NJTHA.

The NJTHA originally sought over $150m from the five organizations – Major League Baseball (MLB), National Football League (NFL), National Basketball Association (NBA), National Hockey League (NHL), and National Collegiate Athletic Association (NCAA) – but Judge Wolfson denied that in December 2020. Still a possibility, however, was the $3.4m bond the leagues were required to put up when they sued New Jersey and the NJTHA in 2014.

NJTHA has agreed to stop its pursuit of the $3.4m and other damages

Though full details of the cease-fire remain under wraps, the NJTHA has agreed to stop its pursuit of the $3.4m and other damages, but the case will end “without prejudice,” meaning that the NJTHA could file another lawsuit later if it so chooses. The parties do have 30 days, however, to try to come up with an agreement in which the case would be dismissed “with prejudice” and the bond released.

NJTHA calls out leagues’ hypocrisy

The $3.4m bond, as mentioned, dates back to 2014, when the five sports leagues sued New Jersey and the NJTHA when Monmouth Park attempted to open a sportsbook. The court granted the leagues a temporary restraining order, requiring the leagues to post a total of $3.4m, split into two equal parts.

The case eventually made it to the US Supreme Court, which struck down PASPA in May 2018, opening the door for all states to legalize sports betting. That same month, the NJTHA filed a motion seeking damages from the leagues, claiming that they made false statements in court about the negative effects of sports betting, spread sports betting around the country, selectively enforced PASPA, and acted in bad faith.

Essentially, the NJTHA argued that the leagues were being hypocritical, as they have done things like require injury reports which are mainly used to help sportsbooks establish betting lines. Singling out the NCAA, the NJTHA pointed to March Madness and the promotion of bracket pools. The biggest punch was arguably the discussion of daily fantasy sports, which are technically illegal under PASPA, but which were also embraced by the professional sports leagues.

Sports betting still growing

Since the Supreme Court overturned PASPA, nearly 20 states have launched legal, regulated sports betting industries. A number of other states have legislation under consideration and some that do have legal sports betting are looking into further expansion. One such state is Oregon, which currently permits online sports wagering only through the Oregon Lottery and in-person betting at two tribal casinos. On Monday, Governor Kate Brown pre-filed a bill that would open the market to other competitors.

Illinois is also looking to expand its sports betting options. The state’s industry launched in March 2020, just days before pandemic lockdowns started. As it stands now, betting on college sports is forbidden, but HB 5876, introduced Saturday, would remove this ban.

Most states that allow sports betting do permit betting on college sports. Some ban betting on contests taking place in the state or involving schools from the state. The fear some have about wagering on amateur sports is that there could be more incentive for an athlete to accept money to influence a game, since collegiate athletes do not get paid to play like pro athletes do.

Kentucky state Representative Adam Koenig also just introduced a bill to legalize online sports betting – along with poker and daily fantasy sports — after trying and failing last year. One of the biggest hurdles he faces is the calendar. The Kentucky legislature meets for only 30 days this year. And because it is an odd-numbered year, it is considered a “non-budget” year, which means that any bills that have to do with revenue like this one require a two-thirds super majority vote, rather than a simple majority.