The SCOTUS heard New Jersey’s case (vs. NFL, NBA, MLB, NHL & NCAA) to strike down a federal law requiring individual states to maintain sports gambling prohibitions on Monday, with most of the judges appearing to agree that Professional and Amateur Sports Protection Act (PASPA) is unconstitutional. The state argued that PASPA runs afoul of the 10th Amendment; infringing on state powers not delegated to the federal government. The leagues argued that an expansion of legalized gambling threatens the integrity of their games and that the law prohibiting legalized gambling on the state-level requires no affirmative action on the states’ behalf. Should the SCOTUS vote in New Jersey’s favor (South Point Casino has NJ as a 4-1 favorite), as many as 32 states (at least 18 have publicly supported NJ) could offer sports gambling within 5 years. A decision isn’t expected until June 2018.
Howie Long-Short: NBA owners are well positioned to cash in, should SCOTUS side with Governor Christie. The league has a 6-year $250 million partnership in place with Sportradar to handle real-time data distribution, data that enables overseas sportsbooks to set odds and take action on in-game bets. Should stateside gambling become legalized, NBA owners can expect the value of that data to soar. Mark Cuban, Michael Jordan and Ted Leonsis (via Revolution Growth) have all independently invested in Sportradar, along with EQT Partners; a private equity firm. You can play Sportradar through the industrial holding company Investor AB (OTC: IVSXF), an anchor investor on all EQT funds.
Fan Marino: Legalized sports gambling will ultimately spell the end of daily fantasy sports, but it won’t be because fans are placing bets on traditional point spreads and over/under totals (though they will be doing that, too). In-game running (or live betting) is the biggest threat to DFS, as it enables fans to place bets after every single stoppage of play; with the odds changing in real-time. U.K. based online gambling company Bet365, which has 19 million users in 200 countries, reported $2.8 billion in revenue over the last 12 months; 73% of that came from live betting.
Supreme Court taking up sports betting case
For the balance of today’s newsletter, sign-up here!
