Federal Judge Upholds Sports Bet Prohibition

New Jersey had sued to be able to offer sports betting at casinos and racetracks.

A federal judge Feb. 28 upheld a 21-year-old law prohibiting sports betting in 46 of 50 states, dealing a setback to New Jersey's attempts to revive its struggling casino industry by grabbing a piece of what has become a multibillion-dollar industry, both legal and illegal.

The defeat was the second for New Jersey in a lawsuit filed last year by the four major pro sports leagues and the NCAA. In a December ruling, U.S. District Judge Michael Shipp denied the state's claim that the leagues and NCAA didn't have standing to bring the suit because they couldn't demonstrate tangible harm to their products if New Jersey were to allow sports betting.

The state is expected to appeal the ruling to the Third U.S. Circuit Court of Appeals and, if necessary, the U.S. Supreme Court.

New Jersey voters passed a sports betting referendum in 2011, and last year the state legislature enacted a sports betting law that limited bets to the Atlantic City casinos and racetracks. Bets wouldn't be taken on games involving New Jersey colleges or college games played in the state.

New Jersey Gov. Chris Christie said at the time that he hoped to grant sports betting licenses by early this year, but those plans have been put on hold. The NFL, NHL, NBA, Major League Baseball, and the NCAA sued the state last year, and the NCAA has moved several of its championship events out of New Jersey because of the sports betting law.

New Jersey has attacked the 1992 Professional and Amateur Sports Protection Act, or PASPA, on several constitutional levels. In filings, the state has argued the law unfairly grandfathered Nevada, Oregon, Montana, and Delaware, which already have some form of sports gambling. New Jersey said the law violated state sovereignty and equal protection provisions and trampled the authority of state legislatures under the 10th Amendment.

New Jersey was given a special dispensation by Congress to approve sports gambling at its casinos within a year in the early 1990s, but didn't do so.