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New Jersey horse racing group claims victory in betting legal case


The New Jersey Thoroughbred Horsemen’s Association (NJTHA) has claimed victory in a long-running legal dispute with the leading US professional sports leagues over sports betting.

The decision by a three-judge panel of the US Third Circuit Court of Appeals clears the way for the NJTHA to claim damages from the professional sports leagues, though it remains to be seen exactly how much they may be liable to receive.

The judges ruled ruled 2-1 in favour of the NJTHA, which was appealing an earlier US District Court ruling that blocked the group from claiming financial damages from the leagues that halted New Jersey’s efforts to legalise sports wagering.

In 2014, the National Football League, the National Basketball Association, the National Hockey League, Major League Baseball and the National Collegiate Athletics Association partnered to file a suit blocking New Jersey’s proposed launch of sports betting. This came after the state legislature passed regulations to legalize the vertical.

At the time, the leagues sought an injunction against the state, saying New Jersey was violating federal law, citing the Professional and Amateur Sports Protection Act (PASPA). The US Supreme Court ultimately struck down PASPA last year, prompting the NJTHA to renew efforts to claim damages from the leagues.

In oral arguments filed with the Third Circuit in July of this year, the NJTHA said it could be owed as much as $150m in damages. However, the Third Circuit’s ruling in favour of the NJTHA is in reference to a $3.4m bond that the leagues posted as security in the event they lost the case.

The NJTHA said the leagues’ use of the law that the Supreme Court later found to be unconstitutional almost put one of the state’s racetracks, Monmouth Park, out of business.

In its ruling, the Third Circuit panel said that as the group had been improperly subjected to a restraining order for 28 days, it was wrongfully enjoined under federal rules of procedure. As a result, the court said, a federal judge should not have denied its claim for damages.

US Circuit Judges Marjorie Rendell and Theodore McKee ruled in favour of the group, while Judge David Porter dissented.

“PASPA provided the only basis for enjoining NJTHA from conducting sports gambling, and the Supreme Court ultimately held that law is unconstitutional,” Judge Rendell said. “Therefore, NJTHA had a right to conduct sports gambling all along.

“We conclude that NJTHA was wrongfully enjoined and should be able to call on the bond.”

However in his response, Judge Porter said: “I disagree that the Supreme Court’s decision holding PASPA unconstitutional necessarily means that the NJTHA was wrongfully enjoined under the PASPA-based [restraining order] issued four years earlier.

“This holding requires indulging the fiction—not available to the District Court that issued the order—that PASPA never existed at all.”