Senator: Leagues staring at defeat

The NCAA and professional sports leagues have battled New Jersey's efforts to legalize sports betting for more than two years. They have only two weeks to respond to the state's latest challenge.

Whether the leagues will continue to fight is up for debate.

On Monday, New Jersey Attorney General John Hoffman issued a directive that instructed law enforcement to refrain from prosecuting sports betting operations at racetracks and casinos. New Jersey Gov. Chris Christie also filed a request for clarification from a district court judge. Christie is looking for approval from the court that the state is not violating federal law by decriminalizing sports betting and allowing private entities to regulate and operate sportsbooks.

The leagues have two weeks to respond. U.S. District Judge Michael Shipp has set a hearing for Oct. 6. For now, operating a sportsbook at racetracks or casinos essentially does not violate New Jersey state law.

New Jersey State Sen. Raymond Lesniak believes the leagues will not challenge the state's latest effort and, instead, will attempt to make a deal for a share of the profits from legalized sports betting.

Other state officials, however, disagree with Lesniak and expect the sports leagues to continue to fight.

The NFL, NBA and NHL declined to comment when reached by ESPN. The NCAA and MLB said earlier in the week that they were working on responses.

"They're staring defeat in the face," Lesniak told ESPN. "There is no way they're going to win in court. I expect that they are going to recognize that and offer a deal. And we're OK with that. Ultimately, before the judge rules, I expect we will have a settlement in hand."

It would be a landmark settlement that would open doors for widespread legalization of sports betting in the U.S. Other states already have contacted New Jersey regarding sports betting, Lesniak said. Currently, only Nevada, Delaware, Montana and Oregon are allowed to offer forms of state-sponsored sports betting. But not everyone believes the legal battle is finished.

New Jersey State Sen. Jennifer Beck said Thursday that she is certain the leagues will challenge. Dennis Drazin, an attorney and adviser to the New Jersey Thoroughbred Horsemen's Association, also remains confident the leagues will keep fighting.

"They absolutely will," Drazin said. "No question."

Both Beck and Drazin singled out the NBA as a possible exception, noting commissioner Adam Silver's recent comments that expanded legalized sports betting is "inevitable" and the league was open to participating in it.

Meanwhile, Monmouth Park, the New Jersey horse track Drazin represents, is moving forward with plans to be a fully operational sportsbook by late October. This week, Drazin sent letters to the leagues informing them Monmouth Park would wait 45 days before starting sports betting Oct. 25. The leagues contacted the state attorney general's office, which then contacted Drazin's office to request the 45-day window. Drazin said the request was not unusual and didn't believe that it signaled the leagues were open to discussions.

Monmouth Park will use the next six weeks to hire and train 111 employees, including five management positions and 30 tellers. The sportsbook will be located in the William Hill Race & Sports Bar at the track. U.K. sportsbook giant William Hill, which also operates sportsbooks in Nevada, has agreed to become Monmouth Park's exclusive sports betting provider but is taking a wait-and-see approach while the legal proceedings play out.

The Monmouth Park sportsbook will have a betting menu similar to what is offered at Nevada sportsbooks, with a few exceptions. Betting will not be allowed on any games involving Rutgers University or any collegiate games played in New Jersey. Bettors will be allowed to wager on professional teams that play in New Jersey, such as the New York Giants and the New Jersey Devils, Drazin said.

The Department of Justice, which intervened in the case on the side of the leagues, could also have a say in a case that most thought was resolved in June. After New Jersey lost in district court and in a majority decision at the Third Circuit Court of Appeals, the Supreme Court declined to hear the state's appeal on June 23. But New Jersey didn't give up.

Within days of the Supreme Court's decision, Lesniak introduced and quickly passed a bill with overwhelming support that would repeal any state laws prohibiting sports betting at racetracks and casinos. Christie vetoed the bill Aug. 8 in a move that left some officials scratching their heads. But exactly a month later, while facing a potential veto override and a crumbling casino industry in Atlantic City, Christie and Hoffman issued the directive and filed the motion for clarification from the district court.

"New Jersey's motion is a legal two-step," said Dr. Ryan Rodenberg, an assistant professor of sports law at Florida State University, who filed an amicus brief in the state's appeal to the Supreme Court. "Gov. Christie is asking the district court judge to clarify his earlier injunction or, in the alternative, to modify the injunction consistent with the Third Circuit decision and legal filings proffered by the Department of Justice and the five sports league plaintiffs.

"If the sports leagues opt to respond formally to the recent motion, as they have the right to do, it will be interesting to see if they do so with a unified voice," Rodenberg added. "Given Adam Silver's comments last week, the NBA appears to be at a different place on this issue than MLB and the NCAA, for example."

Lesniak has said he'll be the first to place a bet, but he's going to have competition. New Jersey bettors are eager to get started. Some are already planning to be at Monmouth Park as soon as the sportsbook is open.

"They wanted to be there to bet on Sunday," Beck said.

Griffin Finan, a gaming attorney for Ifrah Law who has followed the case closely, said individual bettors should feel safe relying on the directive and opinion issued by the state attorney general.

"To my knowledge, there has never been a federal prosecution of an individual [bettor] in a context such as this," Finan said. "In fact, without aggravating circumstances, federal enforcement of sports betting rarely, if ever, ensnares the individual casual Sunday bettor."

A spokesman for the U.S. attorney's office in New Jersey declined to comment.

Other states are watching. Minnesota Rep. Phyllis Kahn, who is up for re-election, told ESPN that her staff is writing a bill that would use New Jersey's approach as a model to pursue legalized sports betting. Kahn plans to introduce the bill in January. In the spring, Mississippi Rep. Richard Bennett put together a task force to see whether legalized sports betting is right for his state.

But for now, all gambling eyes are on New Jersey.