DC Circuit rejects casinos’ challenge to Seminole Tribe’s betting plan

WASHINGTON (CN) — A D.C. Circuit panel narrowly ruled on Friday against a request by Florida casino owners to strike down an agreement between the state government and the Seminole Tribe of Florida allowing the tribe to operate online sports betting, keeping the agreement in place.

The three-judge panel unanimously rejected arguments from lawyers for Magic City Casino and Bonita Springs Poker Room that the gaming compact violated the Indian Gaming Regulatory Act by authorizing gaming outside of tribal land, in this case by allowing people to place sports bets online rather than exclusively from tribal property.

U.S. Circuit Judge Robert Wilkins, a Barack Obama appointee, disagreed with a previous decision by U.S. District Judge Dabney Friedrich, who accepted the casino owners’ argument and granted them summary judgment. 

Wilkins wrote in the court’s opinion that the Donald Trump appointee was trying to answer a question that was not at issue in the case: whether the agreement between the state and the tribe outright authorized bets from non-tribal land, which would violate the IGRA.

“The District Court erred by reading into the Compact a legal effect it does not (and cannot) have, namely, independently authorizing betting by patrons located outside of the Tribe’s lands,” Wilkins wrote in the Friday opinion. “Rather, the Compact itself authorizes only the betting that occurs on the Tribe’s lands; in this respect it satisfied the IGRA.”

The only question the court could answer, Wilkins wrote, was whether Interior Department Secretary Deb Haaland’s decision to allow the compact to take effect without action on her part was legal. The panel ruled that Haaland acted lawfully.

Noting the question of whether Floridians can gamble from outside Seminole lands should ultimately be decided by courts in the state, Wilkins pointed out that the compact directly addressed this issue, which determined that what matters is where the servers hosting the gambling sites are located, not where the gambler themselves are.

Wilkins was joined by U.S. Circuit Judge Karen Henderson, a George H. W. Bush appointee, and U.S. Circuit Judge J. Michelle Childs, a Joe Biden appointee. 

The decision comes as several other challenges to gaming in indigenous communities across the country have arisen in trying to end tribes’ exclusive gambling rights.

A lawsuit in Washington challenging a state law that only allowed tribes to offer sports betting was recently thrown out by a federal judge but could be appealed and end up before the U.S. Supreme Court.

A similar ballot initiative in California from corporations like DraftKings, FanDuel and MGM Resorts International sought to open sports betting, but 82% of voters rejected it in November.

According to a report from the National Indian Gaming Commission, revenue from gambling reached record levels in fiscal year 2021 with $39 billion, a 40% increase from FY 2020 and a 13% increase to pre-pandemic levels in FY 2019. While specific numbers are unavailable per tribe, the Seminole Tribe of Florida — which also owns the Hard Rock brand — was among the top three earning tribes in FY 2019.

That revenue is a boon to tribal governments, many of whom use it to fund social services and infrastructure projects according to the National Congress of American Indians.

The plaintiffs had also made a Fifth Amendment argument that by approving sports betting for the Seminole Tribe, they would effectively have a statewide monopoly over the industry. The panel rejected this outright, finding no basis for the argument.

“We have held that ‘promoting the economic development of federally recognized Indian tribes (and thus their members,)’ if ‘rationally related to a legitimate legislative purpose’ is constitutional,” Wilkins wrote. “The exclusivity provisions in the Compact plainly promote the economic development of the Seminole Tribe.” 

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