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This Week In US Sports Betting January 15 To January 21

Just as everything was moving forward nicely on legal sports betting, the DOJ Office of Legal Counsel dropped a bombshell. It no longer agrees with its previous legal opinion on the Wire Act.

Remember that it was the DOJ opinion on the Wire Act in 2011 that opened the flood gates to state-regulated online gambling.

Many reports suggest that gambling mogul Sheldon Adelson was behind the re-write. He funded the Coalition to Stop Internet Gambling (CSIG). CSIG was remarkably quick to issue a press release barely minutes after the new opinion became public.

The new opinion openly admits that it doesn’t change the law, and that only the courts can decide the real meaning of the Wire Act. Meanwhile, everyone awaits what the DOJ will do. First in the cross hairs are the interstate compacts that permit shared player pools for online poker.

New Jersey, Delaware and Nevada are members of such a compact, although in practice only WSOP.com is affected—WSOP is the only poker provider operating in Nevada.

Sports betting should not be affected directly. The danger is that states’ enthusiasm for enacting more legislation may be reduced leading to delays. There could even be delays about rolling out any internet sports betting or gambling in Pennsylvania.

The technical problem is that data on the internet often flows outside state borders. Even when a player is inside New Jersey communicating with a game server in Atlantic City, the internet can route data outside the state. Maybe the Wire Act makes this illegal, maybe it doesn’t. That’s the whole problem, everyone is now uncertain.

However, we don’t want to spread doom and gloom. The whole issue may well evaporate with no impact, since a number of lawyers think the new opinion is unsustainable.

The industry press is naturally focused on the DOJ opinion, but that doesn’t mean that there hasn’t been a deluge of good news this week. There has!

South Philadelphia Turf Club launches sports betting

The South Philadelphia Turf Club launched its new sports betting facilities last week—as predicted by USBR. The Turf Club is owned by the same folks as the Parx Casino which launched its sports betting the week before.

Harrah’s Philadelphia will launch sports betting on Tuesday, January 22 bringing the total number of sports betting options in Pennsylvania to six. The Tuesday launch is for regulatory testing, full public access begins on Thursday.

Caesars Entertainment EVP of Gaming & Interactive Entertainment, Christian Stuart commented:

“The Harrah’s Philadelphia offering is fully integrated into Total Rewards, so customers can easily earn and redeem points for all Caesars amenities worldwide. The Caesars brands powered by SG Digital technology will be a powerful player as we expand across the U.S. in retail and mobile sports betting (pending regulatory approval).”

In other news from PA, the Pennsylvania Gaming Control Board (PGCB) published revenue numbers for the first three casinos to launch sports betting. The numbers are tiny, but they will grow fast.

New Jersey’s revenue figures show just how far PA can go. The latest numbers came out last week showing that the state has now generated over $1 billion in gross gaming revenue.

Rhode Island gets a mobile sports betting bill

President of the Senate Dominick Ruggerio personally introduced a bill to make online and mobile sports betting legal.

The bill gives the lottery authority to contract with a provider, but the odds are that the deal will go to William Hill. William Hill and its partner IGT currently have the contract to provide sports betting for the two Twin River casinos.

The only weakness in the bill is the condition that players must sign up for accounts in person at one of the casinos. No online sign-ups are allowed.

Massachusetts Governor introduces his own sports betting bill

Governor Charlie Baker introduced his own sports betting bill in the Massachusetts legislature on January 17.

The bill is a first of its kind for the US. Operators that want to offer sports betting do not need to partner with an existing casino first. This suits industry players like DraftKings, and avoids charges of crony capitalism.

There are only two licensed casinos in the state, MGM Springfield and Plainridge Park. Later in 2019, Wynn will open the Encore in Boston Harbor. All will be lobbying for the bill to limit licenses to casinos as in New Jersey and Pennsylvania.

What we’re looking for next week

  • Harrah’s Casino to launch sports betting in Philadelphia, PA
  • Possible legal challenge to DOJ opinion—Former NJ Senator Ray Lesniak has said he may get involved.

And of course there will be a few surprises to keep us on our toes. Have a great week.

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