The Florida Seminole Tribe continued to play hardball with the state of Florida last week, when it said it would stop making gaming payments to the state while the validity of its 2021 compact is working its way through the federal courts. Politico broke the news that the tribe — which under the new compact would have paid the state $500 million per month — is putting payments into an escrow account until the issue is resolved.
The compact, negotiated last spring, would have extended the tribe’s exclusivity to gaming to digital sports wagering, but a pair of parimutuels sued the U.S. Department of the Interior last fall claiming the compact was outside of the bounds set by the Indian Gaming Regulatory Act. A U.S. District court judge in November ruled the compact invalid and instructed the Seminoles to take down their Hard Rock Sportsbook platform. The tribe launched the platform after the start of the court case, and it was live for 34 days before an appeals court upheld the lower court’s decision, and the tribe complied.
The state stands to lose billions in expected revenue until the case is resolved, which could take months, if not years. The case started in U.S. District Court for the District of Columbia, after the Magic City Casino and Bonita Springs Card Room challenged the legality of the compact.
At issue is the idea that IGRA authorizes brick-and-mortar gaming on tribal lands, but the compact gave exclusivity to the tribe for online/mobile wagering, essentially shutting out commercial operators. The compact does allow for the tribe to partner with parimutuels for digital wagering, but at a steep price. IGRA, written in 1988, does not contemplate digital gaming.
It’s going to be a while before case is decided
Stakeholders have previously told Sports Handle that the case is likely to go to the Supreme Court, no matter how the U.S. Circuit Court of Appeals rules. Last month, a second plaintiff, Monterra LLC, which is arguing that the decision to allow sports betting should go to the voters, argued that its case should be heard at the appellate level as well.
DraftKings and FanDuel last year tried to get an initiative on the November 2022 ballot that would have allowed for statewide mobile wagering offered by commercial operators as well as the Seminoles, but they could not get enough signatures to qualify.
With only one gaming tribe in Florida, the fight for control between the Seminoles and commercial entities has been intense. Like tribes in other states, the Seminoles are trying to protect their financial lifeline, and the case is being closely watched, as a court decision to uphold the compact could have far-reaching implications.
In spite of the ongoing lawsuit, the tribe could renegotiate with the state at any time, and other entities are entitled to try for a ballot initiative, though it appears the first opportunity after November would be a 2024 ballot.
