Former NJ Gov. Chris Christie Calls Out Leagues, Federal Sports Betting Laws

Speaking to lawmakers from across the country at a meeting of the National Council of Legislators from Gaming States, Christie blasted the leagues – and the National Football League in particular – for what he called a double standard. After the NFL, along with the NBA, NHL, MLB and the NCAA, blocked New Jersey’s move to legalize sports betting in court, Christie said he was willing to settle with the leagues in order to open legal wagering.

Chastising the major American sports leagues for what he called their underlying duplicity, former New Jersey Gov. Chris Christie urged a group of state lawmakers not to capitulate to demands for data usage or so-called integrity fees as nearly two dozen state legislatures prepare to take up sports betting legislation or have already done so.

Speaking to lawmakers from across the country at a meeting of the National Council of Legislators from Gaming States, Christie blasted the leagues – and the National Football League in particular – for what he called a double standard. After the NFL, along with the NBA, NHL, MLB and the NCAA, blocked New Jersey’s move to legalize sports betting in court, Christie said he was willing to settle with the leagues in order to open legal wagering.

He said he was even willing to negotiate a so-called “integrity fee,” or a cut of gaming winnings reallocated to the leagues. Their recalcitrance to negotiate during years of legal battles, Christie said, ended any chance of to do so once the Supreme Court eventually sided with New Jersey.

“They laughed at me,” Christie said. “Everyone laughed at me. They’re not laughing anymore.”

While integrity fees gained little traction in statehouses, data fees, or compensation to leagues in exchange for official match data, have received greater focus from the sporting organizations. As with the former efforts, Christie rejected any league-led effort to include the fees in legislation.

The forceful call to reject the fees echoes similar sentiments from gambling companies as well as nearly all lawmakers in states considering sports betting expansion. Christie, as well as other state officials, have largely resisted the fees, in large part because it presents a threat to state coffers.

No states with legal sports betting or considering bills to do so have included data fees, but their potential, bolstered by league-hired lobbyists, still hovers around statehouses.

“These folks will now come to your state capitals and argue with you that they should somehow now get something for free from you that they were unwilling to settle on when they were in the midst of litigation,” Christie told the gathered lawmakers in reference to the lobbyists.

”(The leagues) don’t need integrity fees,” Christie said. “They don’t deserve a data fee.”

’We Don’t Need a Federal Solution’

Christie further encouraged state lawmakers to reject federal oversight. Citing what he called the failings of the federal ban, known as the Professional and Amateur Sports Protection Act or PASPA, he said more federal oversight would hurt states and go against the very constitutional principal he had challenged in the first place.

Christie also cited the decades-long operation of the Nevada sports betting market, as well as successful launches of other states’ sports betting infrastructures.

”When did Nevada sports gaming every seem like it was incapable of being regulated by the state regulators in Nevada?” Christie asked rhetorically. “When I ask people in the federal government they can’t come up with one reason, one example in New Jersey or Nevada, which have the longest track records.”

Despite Christie’s position, lawmakers in Congress have introduced a federal regulatory framework.

After months of speculation following the Supreme Court decision to strike down the federal ban, Senate Minority leader Chuck Schumer as well as then President Pro Tempore Orrin Hatch introduced a sweeping federal sports betting framework last month. The bill called for a federal-level data fee, much to the chagrin of gambling stakeholders.

Though introduced by two influential lawmakers, industry observers feel there’s minimal chance the bill gains much traction on Capitol Hill.

Congress has reached nearly unprecedented levels of legislative impasse, as Christie noted by the ongoing partial government shutdown, and federal gambling legislation has little appetite to being with. Plus Hatch, the bill’s co-sponsor and original co-author of the federal ban, retired from Congress earlier this month.

Christie, New Jersey Jumpstart Sports Betting Expansion

The keynote address on state-level sports betting laws to the NCLGS wouldn’t have been possible without Christie’s efforts earlier this decade.

New Jersey has been one of the most progressive gambling states in the nation for decades, becoming the second state after Nevada to legalize casino gaming. Anchored by Atlantic City, New Jersey quickly became a gambling hotbed shortly after casinos opened in the 1970’s and remained the preeminent gaming destination along the east coast for decades.

Increasing competition in neighboring states, as well as an economic downturn during the Great Recession, hindered Atlantic City and New Jersey gaming as a whole. To turn the tide, New Jersey looked to sports betting to help jumpstart the struggling industry. In 2011, government officials proposed, and New Jersey voters overwhelmingly approved, a state constitutional amendment to permit sports betting.

That couldn’t come into effect with PASPA in place, as well as the legal injunction filed by the leagues to prevent sports betting form happening.

A former U.S. attorney for New Jersey, Christie as well former Solicitor General Ted Olsen spearheaded the legal challenge to the federal ban. After several unsuccessful legal challenges, New Jersey adjusted its legislation to better comply with a circuit court ruling and argued that the ban promulgated the state from regulating its own affairs in violation of the 10th amendment.

“This is at its core a states right issue,” Christie said about his legal strategy. “The federal government, through PSPA, tried to foist upon the states the obligation to regulate something in a manner they were unwilling to regulate themselves. If you’re the federal government you can’t have it both ways.”

Lower courts disagreed likewise with the revised legal reasoning, and rejected multiple appeals over several years of legal challenges. Overall, there were seven distinct appeals to the courts, as well as a rejection for a hearing from the Supreme Court.

Turning the Tide for Legal Sports Betting

Christie’s efforts seemed in vain until 2017 when he and Olsen appealed one more time to the Supreme Court, which unexpectedly decided to hear the case as a test of the 10th Amendment. The court takes less than one percent of appeals, which in of itself presented a victory for New Jersey: industry observer predicted the court wouldn’t take up the case just to uphold the lower courts’ decisions.

That momentum only increased in the following months.

The court heard formal arguments in December, which further buoyed supporters’ optimism. The majority of justices seemed to side with New Jersey’s arguments and against the defendant, the NCAA as well as the major U.S. professional sports leagues.

In May, the court announced it had struck down the federal ban in its ruling, largely because it determined the law violated the anti-commandeering principal of the constitution. With Christie out of office following the end of his second term in January 2018, new Gov. Phil Murphy took the baton and signed final sports betting approval into law several weeks after the Supreme Court decision was announced.

That initial legal challenge broke more than two decades of federal regulation and opened the flood gates of legal sports betting that is only expected to increase in coming years.

Eight states are taking bets In the wake of the Supreme Court with Washington D.C. and Arkansas set to do so sometime next year. More than a dozen states are poised to take up similar bills during their respective legislative sessions.

In all, more than two dozen states are expected to take legal wagers sometime in the next few years.