NJ Horsemen: No Need To Wait For Supreme Court On Our $150M Lawsuit Against Sports Leagues

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New Jersey’s thoroughbred horsemen have fired back at the NFL and its four fellow plaintiffs in a $150 million lawsuit, asserting that the sports organizations are “blaming the victim” as they seek to have their case heard by the U.S. Supreme Court.

At issue is the fact that a Third Circuit Court of Appeals panel last fall sided with the horsemen in finding that they were “wrongfully enjoined” from offering sports betting at Monmouth Park from 2014-18.

That has the horsemen seeking, at the very least, to collect a $3.4 million bond set aside by the leagues in 2014.

More importantly, the horsemen also want to be compensated for that entire period of late 2014 until mid-2018 — a time when the horsemen were barred from offering sports betting at Monmouth Park, but only because of a 1992 federal law that was found to be unconstitutional by the U.S. Supreme Court 26 years later.

The sports leagues’ petition to the Supreme Court is a long shot, of course.

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But the leagues noted in their filing that it also was a long shot for the Court to review Congress’s Professional and Amateur Sports Protection Act of 1992 that prevented all states but Nevada from offering full-scale, Las Vegas-style sports betting.

The leagues assert that there is no point in moving forward until the Court reveals if it will take up the case. It’s a seemingly sound argument, but the horsemen are trying to turn it on its head, saying instead that there is no point in wasting the Supreme Court’s time when action in the U.S. District Court may render the petition to that court irrelevant.

What “irreparable injury”?

The horsemen also go after the leagues on one of their weakest links: that a temporary restraining order was urgently needed in 2014 to avoid “irreparable injury” to the leagues should their Jersey Shore racetrack be allowed to offer the same sports betting that Nevada has had for many decades.

“They supported their claim of irreparable injury by swearing, in the words of their Verified Complaint, that halting the spread of sports gambling was ‘imperative to prevent irreparable injury.’

“Hypocritically, at the same time as petitioners were swearing to the court that they would suffer immediate irreparable injury unless a TRO was issued, they were indisputably supporting and profiting from the proliferation of sports gambling throughout the United States and internationally.”

The horsemen point to sports leagues partnerships with daily fantasy sports companies, as well as an eagerness by the NCAA and the four pro sports leagues to host games in Las Vegas, London, and other locales where sports betting is legal. The Vegas Golden Knights began play in the NHL in 2017 — even as the league continued its doomed sports betting battle against New Jersey. The Oakland Raiders are scheduled to move to Las Vegas this fall, if the worldwide pandemic doesn’t impact that game plan.

NBA Commissioner Adam Silver famously came out in favor of legal, regulated sports betting — though with federal oversight rather than the current state-level model — in 2014, just weeks after the leagues posted a bond while opposing New Jersey’s efforts.

Horsemen say they are no “victims”

The “blaming the victim” phrase refers to the fact that the New Jersey Thoroughbred Horsemen’s Association (NJTHA) is seeking to collect on the bond posted by the leagues once the leagues sought and received a temporary injunction.

“As made clear by this Court’s final judgment in this case, NJTHA was fully within its rights when it sought to begin accepting sports bets at Monmouth Park on October 26, 2014. Petitioners were not coerced to seek a TRO. Instead, they undertook the risk of seeking a TRO, knowing full well that they would have to pay bond damages if it was later determined, as it was, that NJTHA had been ‘wrongfully enjoined.’

“As the Third Circuit put it: ‘Temporary restraining orders are not always a sure bet.'”

The horsemen also dismiss a claim by the leagues that the Supreme Court is quite likely to take the case because of a “circuit split,” whereby two different circuit courts reach opposite conclusions on an issue, potentially forcing the Supreme Court to clarify the matter.

The leagues, according to the horsemen, are trying to “manufacture a circuit split” based on a contrary Fifth Circuit decision regarding the ability to collect on a bond.

“Even if the Fifth Circuit had not itself called into question its own earlier decision, any purported circuit split would be completely lopsided in favor of the rule followed by every other circuit to have decided the issue,” the horsemen say.

No reason for Supreme Court here?

The horsemen also downplay the leagues’ pitches to the Supreme Court, saying that “both questions presented by petitioners are of little importance to anyone other than petitioners and NJTHA. This case is sui generis.”

That uniqueness, the horsemen say, is underscored by the Third Circuit’s description of the now eight-year court battle as a “lengthy saga” with the current iteration as merely “the last shoe to drop.”

The leagues also repeatedly have focused on the notion that U.S. District Court Judge Michael Shipp “had no realistic choice” other than to grant the restraining order in 2014 based on a previous Third Circuit ruling.

The horsemen have said that is irrelevant, because the ultimate Supreme Court ruling means that the horsemen were unfairly deprived of offering sports betting from 2014-18.

But in this filing, the horsemen also insist that Shipp was under no such limitation — in part because even that initial ruling by the Third Circuit had suggested, while siding with the leagues, that the state might be able to offer sports betting if it amended its state law to conform with PASPA and not directly authorize the gambling. That’s exactly what legislators did, leading to the 2014 effort to begin sports betting at Monmouth Park.

“The Third Circuit debunked petitioners’ claim. It wrote that the district court did have a realistic choice to deny the TRO and was not ‘bound’ by the Third Circuit’s holding to enter the TRO. The District Court might have, instead, seized upon [the Third Circuit’s]reasoning that a repeal would not be an authorization in violation of PASPA.”

Bond … $3.4 million bond

The horsemen also doubled down on what is appearing to be a strong likelihood that at the very least, they will collect that $3.4 million bond.

The Third Circuit “adopted the rule held by the clear majority of its sister circuits that there is a rebuttable presumption that a wrongfully enjoined party is entitled to recover provable damages up to the bond amount” — an amount, the horsemen add, that was “well below what the NJTHA had requested.”

“Significantly, the Third Circuit was careful to point out that petitioners have not claimed that the bond amount is unreasonable.

“The only question that needs to be answered is whether the enjoined party had a right all along to engage in the enjoined activity. If the law on which the injunction was based was ultimately found to be unconstitutional, the enjoined party was ‘wrongfully enjoined.’”

Photo by Wangkun Jia / Shutterstock.com

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John Brennan

John Brennan has covered NJ and NY sports business and gaming since 2002 and was a Pulitzer Prize Finalist in 2008, while reporting for The Bergen County Record.

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