Redacted Filings In NJ Sports Betting Case: Is It Time To Unseal Them?

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Back in 2012, several pro sports league commissioners and other top executives — as well as others from the NCAA — were deposed for testimony in the New Jersey sports betting saga that ended last year with the U.S. Supreme Court’s striking down of a federal law severely limiting legal sports wagering.

On Monday, on the eve of oral arguments at the U.S. Third Circuit Court of Appeals in what could be described as a “sequel,” Florida State Prof. Ryan Rodenberg — an expert on sports law who for years has closely followed the machinations of the New Jersey sports betting saga — introduced a provocative paper on the topic at an academic conference in San Francisco.

Titled “Sealed Expert Reports and Redacted Depositions in the Supreme Court Sports Betting Case,” the paper elaborates on a May 2018 motion by the state’s thoroughbred horsemen to U.S. District Court Judge Michael Shipp — one reiterated seven months later.

The horsemen requested to see “all of the documents produced by the Leagues as well as the complete unredacted transcripts of the depositions taken in discovery” in the first phase of this complex case.

But do the leagues have a right to keep those filings in their redacted state after all these years?

In December 2012, NBA attorney Daniel Spillane certified to the judge that some of the documents “contain highly confidential and proprietary business and marketing research and information.” The disclosure of one particular study, according to Spillane, “would cause serious injury to the NBA” because other leagues would gain a competitive advantage based on knowledge from the study of comparative fan perception of the NBA.

One of the quirks of this issue is that while the horsemen are seeking to gain access to various sports league documents, their allies in the New Jersey Attorney’s office filed their own 2012 appeal to the court to have certain documents sealed. The leagues quickly filed a motion in support of the state on that very narrow topic.

Would state officials have the right for such a sealing in perpetuity, too — that is, if they wanted one?

The people’s right to know

Rodenberg — who appeared on 60 Minutes in March to talk U.S. sports betting expansion — embarks on an analysis of the long history of public access to court documents. There seems to be little question regarding criminal cases.

“However, no Supreme Court ruling has directly addressed whether the First Amendment grants a right to access court documents in civil ligitation, like the New Jersey sports betting case,” Rodenberg said.

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Still, the history of First Amendment and common law legal arguments, Rodenberg demonstrates, weigh heavily in favor of even non-involved third parties being able to stake a claim to release of redacted documents.

Third Circuit precedent, of course, is crucial to potential outcomes. In a 1984 case, a panel concluded that “we hold that the First Amendment embraces a right of access to civil trials … the public’s right of access to civil trials and records is as well established as that of criminal trials and proceedings.” At least five other circuits, Rodenberg writes, have reached that same conclusion, as have judges in at least four other cases within the Third Circuit.

This all becomes more than just a philosophical argument because, Rodenberg notes, Shipp cited sealed documents by the NBA and NCAA as well as a report by the state’s expert economist in rendering his decision.

Shipp wrote, for example, that a 2007 NBA study about the league and Las Vegas gambling “draws an undisputed direct link between legalized gambling and harm to the leagues.”

As for the report by the economist, Robert Willig, Shipp wrote that “as conceded by Defendants’ expert, Mr. Willig, legalizing sports wagering in New Jersey … could stimulate a certain amount of sports wagering that would not otherwise occur … the Sports Wagering Law will, at a minimum, likely increase the perception that the integrity of the Leagues’ games is being negatively impacted by sports betting.”

Yet Willig’s 115-page report concludes instead that “the shifting of sports wagering from illegal to legal outlets would likely not harm the Leagues — in fact, they likely would benefit from such a shift.”

Willig subsequently objected to the characterization of his report by Shipp and subsequent Third Circuit judges.

Rodenberg cites that conflict as one of the reasons for the records to be released because “such an unsealing would reveal the grounding, if any, for how the five sports league plaintiffs convinced Judge Shipp that such leagues were injured and irreparably harmed by legalized sports betting in New Jersey and beyond. Such a revelation would also assist in the determination of whether the Supreme Court sports betting case was a pecuniary ruse by one or more of the plaintiffs.”

Tuesday’s Third Circuit hearing

Tuesday’s oral argument surely will mainly focus on other matters, since it is much more narrowly focused on damages subsequent to the Supreme Court ruling.

The core issue is whether the horsemen are entitled to a $3.4 million bond put in escrow by the leagues in 2014 to compensate the horsemen for a brief period, while Shipp weighed the merits of the case, should the horsemen ultimately prevail.

That looked like a slam dunk for the horsemen last year, on the surface. But the leagues insist the horsemen are entitled to nothing, in spite of winning the case. Shipp yet again sided with the horsemen, which is how the case wound up in the same Third Circuit whose 2-1 decision favoring the leagues was vacated by the Supreme Court (Marjorie Rendell, one of the two judges on the losing end of that case, was chosen as one of the three judges to handle this issue).

The bigger fish, though, is up to $150 million sought by the horsemen for a period of years, not weeks, in which they sought to offer legal sports betting, yet were delayed by a series of court rulings that ultimately were overturned.

If the horsemen’s arguments prevail, they could begin a discovery phase that includes depositions and other filings all over again, with questions down the road over how much access the public should have for the new information.

Photo by 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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