Florida Online Sports Betting: Seminole Compact and Petitions

In May 2018, the U.S. Supreme Court ruled in Murphy v. NCAA that individual states could repeal state legislation, which would in turn authorize sports betting under the Professional and Amateur Sports Protection Act (PASPA). After being illegal for decades, sports betting was finally permissible. In January 2021, U.S. sports betting revenue was projected to hit $3 billion, an increase of 100% from the $1.5 billion generated in 2020. Many states, including Florida, New York, and Colorado, started repealing their state laws to legalize online sports gambling. However, Florida has hit a snag with their “hub and spoke” online sports betting compact with the Seminole Tribe. It was deemed to be stranger than fiction.

Sports betting in Florida has hit a hard stop—at least until 2025. Due to the recent D.C. Circuit Court decision that overrode the gambling compact between the State of Florida and the Seminole Tribe, these parties will have to renegotiate the compact or place a voter initiative on the ballot in 2024. The Seminole Tribe currently has sole control over sports betting, but their efforts to legalize it in Florida have been put on hold. Any chance of online sports betting becoming legal in 2023 are slim due to ballot measures falling short of the required signatures and the courts invalidating the compact.

Chapters

  1. Florida Sports Betting: A Brief History
  2. Recent Legalization Pushes
  3. Florida Sports Betting: Current Status
  4. Opinions: Governor, Legislature, Legal
  5. Conclusion

History of Florida Sports Betting

The road to legalized gambling in Florida was a long one. While charitable gambling is permissible, gambling in general is not allowed unless in a legally-approved location. Starting in 1931, Florida legalized certain kinds of gambling, which included betting on dog horse racing. In 1935, Florida legalized jai alai and slot machines. Then bingo halls and card rooms were legalized, including places that provided competitive poker. Yet, by 1973, the law that legalized slot machines was repealed, causing their removal from casinos.

Since 1979, the Seminole Tribe first started offering gaming with a high-stakes bingo hall. Then in 1988, Congress passed the Indian Gaming Regulatory Act of 1988 (IGRA), 25 U.S.C. sections 2701 et seq., which legalized casino gambling on tribal lands as well as other games including traditional Indian gaming, bingo, tip jars, pull tabs, lotto, punchboards, and certain card games. Pursuant to the statute, the National Indian Gambling Commission (NIGC) develops regulations for Indian Gaming.

The local Floridian Tribes established eight casinos, with the Seminole Tribe operating seven of those gambling establishments and the Miccosukee Tribe runs the eighth. The Seminole Tribe established the Hard Rock Casino and Hotel chain and have since established casino gambling locations on tribal lands in Hollywood, Tampa, Coconut Creek, Immokalee, and Brighton.

Indian Gaming Regulatory Act

On March 27, 1996, the U.S. Supreme Court held in Seminole Tribe of Florida v. Florida that the Indian Gaming Regulatory Act (IGRA) provided that Tribes may conduct gambling in accordance to a valid compact between them and the state where the activities are located. By 2004, the State of Florida permitted casino gambling with the legalization of slot machines in betting locations in Broward and Miami-Dade counties.

With the rise of internet-based activities, online gambling expanded quickly. In 2006, Congress passed the Unlawful Internet Gambling Enforcement Act (UIGEA), found at 31 U.S.C. §§ 5361–5367, which prohibits businesses from “knowingly accepting payments in connection with the participation of another person in a bet or wager that involves the use of the Internet and that is unlawful under any federal or state law.” The act excludes fantasy sports that meet certain statutory requirements, skill games, and legal intrastate and tribal lands-based gambling.

Sports Betting Illegal in Florida

Prior to the 2021 gambling compact, Florida law prohibited wagering on “any trial or contest of skill, speed or power or endurance of human or beast” but did permit betting on jai alai, horse racing, and dog racing. Specifically, the law prohibits betting on all major sports with the narrow exceptions mentioned previously. Due to the 2018 constitutional amendment, which added Article X section 30, the Governor of Florida can only negotiate with Native American tribes in Florida to expand gambling. Only through a citizen’s ballot initiative can sports betting be expanded, except the state and the tribes can negotiate online gaming compacts under IGRA. In other words, Floridians must approve any expansion of gambling outside tribal lands.

Florida Sports Betting Petition
Florida Sports Betting Petition

Recent Legalization Pushes

Gambling in Florida is already an economic powerhouse, even though online sports betting is not legalized yet. Revenues were estimated to be about $350 million per year for the state. While gambling has been on the ballot several times, expanding gambling outside the Seminole tribal lands has not been very popular. Several amendments were placed on the ballot starting in 1978 (Amendment 9), 1986 (Amendment 2), 1986 (Amendment 5), 1994 (Amendment 8), 2004 (Amendment 4), and Amendment 13 (2008), and the important Amendment 8 passed in 2018.

Exclusive Seminole Compact

With the passage of Amendment 8 in 2018, the Florida Constitution was modified so that any expansion of casino gambling in Florida would have to be approved by voters. Yet, the Government of Florida and the Seminole Tribe can negotiate a “class III” gaming compact to permit gambling on “Indian lands.” It included language that would allow for Seminole casinos to offer online sports gambling through their sportsbook, which anyone can access across Florida. Class III gaming includes horse racing, lotteries and casino games, such slot machines, roulette, craps, and banking card games like chemin de fer, baccarat, and blackjack.

The compact essentially granted the Seminole Tribes exclusive rights to host mobile and online sports betting within Florida, “conducted by the Tribe where the servers or other devices used to conduct such contests on the Tribe’s Indian lands are located.” All in-state wagers would be deemed to be on tribal lands where the computer servers process the online bets. So, a Floridian could be at the beach in Ft. Lauderdale and be able to place a sports bet bet via app or webs browser which would be processed on the Seminole’s servers in Hollywood at the Hard Rock Casino.

2021 Seminole Gambling Compact

In the 2021 gambling compact, the Seminole Tribe would offer online sports betting through a “hub-and-spoke” program for qualified parimutuels and online sportsbook operators. In the 30-year gaming compact—approved during a special session of the Florida legislature in May 2021—the Seminole Tribe agreed to pay the state $2.5 billion over the first five years in exchange for having a monopoly over sports betting as well as allowing for craps and roulette to be added to their casino operations. The state would potentially receive $20 billion over the next 30 years.

On August 5, 2021, the gambling compact was approved by the Secretary of the Interior Deb Halaand with her discretionary authority. It was published in the Federal Register on August 11, 2021, and therefore took legal effect. On November 1, 2021, the Seminole Tribe launched its Hard Rock online sportsbook app in Florida, which was earlier than their initial date of November 15th. However, in response to the November 2021 D.C. Circuit Court decision, Hard Rock pulled its sportsbook app on December 4, 2021.

Petitions & Ballot Initiatives

Ballot measures, which include constitutional amendments, must meet a signature threshold in order to be submitted to the voters. For the 2022 ballot, the gambling measure must receive 891,589 valid signatures, equal to 8% of the votes cast in the last presidential election.

Fanduel and Draftkings organized a local petition, called the Florida Sports Betting Initiative (Initiative #21-13), to put to the voters on the November 2022 ballot. As the Florida Education Champions, the campaign had submitted 514,874 valid signatures as of February 1, 2022, but it was not enough to make the November 2022 ballot threshold. They announced that they will look into other long-term measures to legalize online sports betting in Florida.

Also, the Florida Voters in Charge sponsored a ballot initiative, called the Florida Casino Gaming Expansion Initiative (Initiative #21-16), regarding expanding casino gambling in Florida—opposed by the group Standing up for Florida, Inc. who is affiliated with the Seminole Tribe. However, it fell just shy of the 8% threshold needed to for the ballot.

Florida Sports Betting Current Status

The Seminole Tribe believed that placing servers on tribal lands would abide by both the 2021 gambling compact and the IGRA. While the 2021 compact failed to be approved by the court, the Seminole Tribe could renegotiate to offer online sports betting to patrons physically located inside their casinos on tribal lands. However, because the 2021 gambling compact was overturned by the court, the 2010 compact is now reinstated. Florida was expected to receive $500 million in revenues under the new deal but now will only receive $350 million per the 2010 compact.

Compacts in Other States

The Seminole Tribe can look to another tribe for guidance. For example, in Wisconsin, the state and the Oneida Tribe created their own sports betting compact that was approved by the Federal government in 2021. Their press release announced that Wisconsin and the Oneida Tribe added an amendment to their Compact to allow sports betting in the Oneida Main Casino in Green Bay, which would use a brick-and-mortar sportsbook. Online sports betting would be available at select Oneida casino locations. Granted that this compact is not overturned by a court for violating the IGRA, the Seminole Tribe and Floridian government could look to its text as the basis for revising their compact so it complies with the law.

On November 22, 2021, in the combined cases West Flager Associates, et al. v. Deb Halaand and Monterra MF, LLC v. Deb Halaand, the petitioners argued that the Compact violates IGRA because it authorizes class III gambling outside of “Indian lands.” The Petitioners, which included Magic City Casino, Bonita Springs Poker Room, No Casinos, Armando Codina and Norman Braman, filed their petition against the Department of the Interior in the D.C. District Court, asking the court to set aside the Secretary’s approval of the gambling compact between the Seminole Tribe and the State of Florida under the Administrative Procedure Act. They contended that the compact violated the Indian Gaming Regulatory Act, the Unlawful Internet Gambling Enforcement Act, the Wire Act, and the Equal Protection Clause.

However, the government argued that the “Compact provisions deeming the placement of the bet as occurring on Indian lands instead reflect the State’s agreement in the Compact that the Tribe regulates all sports betting activity—the placement of the wager, as well as its receipt—even if such wager is placed by a person physically located off of the Tribe’s Indian lands.”

Seminole Compact Violates Law

On November 23, 2021, the D.C. District Court held that the compact between the Seminole Tribe and the Florida government, which authorized online gambling exclusively for the Seminole Tribe, violated Federal law. According to the court, a person must be physically present on tribal lands in order to place bets.

In her decision entered on November 22, 2021, Judge Dabney L. Friedrich concluded that the Compact violated the IGRA, which requires that any state-sanctioned gambling must occur on tribal land. She determined that online sports bets placed anywhere in Florida and passing through computer servers on Seminole tribal lands was fiction because they cannot merely deem it so to avoid federal legislation.

Although the Compact ‘deem[s]’ all sports betting to occur at the location of the Tribe’s ‘sports book[s]’ and supporting servers … this Court cannot accept that fiction. When a federal statute authorizes an activity only at specific locations, parties may not evade that limitation by ‘deeming’ their activity to occur where it, as a factual matter, does not. . . Accordingly, because the Compact allows patrons to wager throughout Florida, including at locations that are not Indian lands, the Compact violates IGRA’s ‘Indian lands’ requirement.

She ordered the state to reinstate the Seminole Tribe’s prior gaming compact agreed to in 2010 and that they may agree to a new compact to allow sports betting on tribal lands or citizens may authorize it across Florida’s lands through a citizen’s initiative.

Decision Aftermath

The Seminole Tribe filed their appeal the day after the court’s ruling. On December 3, 2021, the District of Columbia appellate court denied the Seminole Tribe’s appeal because they failed to show irreparable harm if it is forced to halt its sports book operation while it appeals the lower court’s ruling. The Tribe tried to intervene in the case but with no success. The Department of Justice, who took the brunt of the court’s decision for not properly following the law when it approved the gambling compact, filed their appeal in late January 2022.

Constitutional Amendments

The other options to legalize online sports gambling could involve the Florida Legislature placing a constitutional amendment on the November 2023 ballot or to design a different sports betting regime that does not violate the IGRA. Other states—including Wisconsin, Connecticut, Arizona, and Michigan—approved sports gambling on tribal lands but these practices are physically limited to these locations, unlike Florida’s compact.

The Seminole Tribe faced fierce political foes. Codina and Braman, in particular, have funded initiatives to block gaming expansion for decades and who were the power behind the 2018 constitutional amendment declaring that only voters through a statewide referendum can approve the expansion of gambling.

Additionally, the Florida Legislature is in the process of developing a Florida Gaming Commission created alongside the compact to regulate expanded gambling. It transfers this responsibility from the Florida Department of Business and Professional Regulation. The commission would have 5 members appointed by the governor from each of the five (soon to be six) state appellate court districts, subject to confirmation by the Florida Senate.

Florida Leaders' Opinions on Sports Betting
Florida Leaders’ Opinions on Sports Betting

Opinions: Governor, Legislature, Legal

Governor Ron DeSantis, the current governor of Florida, commented that “I would imagine this is going to be appealed.” “We structured the compact so that the compact is preserved for the casinos and the other stuff,” DeSantis said. “So, we’re going to still be getting revenue, obviously we’ll get less revenue from sports betting if they’re not able to do hub and spoke.” And admitted that the “hub and spoke” approach was a legal gray area.

Against Court Ruling

Senator Jeffrey Brandes (R-26): “I’m looking forward to discussion as the initiative gets filed with legislators who supported the compact. It will be interesting to see if they support expanding sports betting beyond the compact to the private market. Generally, Republicans should be for free and open markets, and we’ll see if that holds true when it comes to sports betting.”

Bob Jarvis, a professor specializing in gaming law at Nova Southeastern University’s Shepard Broad College of Law, “It’s a better lawsuit. But it’s still dead on arrival.” Further, he added: “It’s important to keep going back to 1988 and what Congress did with IGRA,” Jarvis said. “States and tribes should play nice together and find a good pathway to move forward together, so to think that a judge is going to second guess all of that is crazy.” “We’re living in the Seminoles’ world,” Jarvis said. “That’s the deal that was struck. And everyone else will get the crumbs. The Seminoles have been working toward this kind of deal since the 1990s.”

Florida Voters

More than 3 in 4 Floridians surveyed said that voters should have to approve a gambling deal. In a new poll commissioned by No Casinos, it shows that 76% of Floridians surveyed say voters should have to approve a gambling deal, compared with 13% who say it should be left to the Legislature.

“Most voters believe that the compact’s predicate that having the computer system hub that hosts online gambling on tribal property constitutes gambling as being on tribal lands does not pass the ‘smell test,'” wrote pollsters Jim McLaughlin and Rob Schmidt for No Casinos.

Pro Sports Betting

  • Seminole Tribe spokesman Gary Bitner said the Tribe “is reviewing the judge’s opinion and carefully considering its next steps.”
  • Florida Education Champions, the campaign organized by Fanduel and Draftkings: “We are extremely encouraged by the level of support we saw from the more than one million Floridians who signed our petition and thank them for their efforts in wanting to bring safe and legal sports betting to Florida, while funding public education. While pursuing our mission to add sports betting to the ballot we ran into some serious challenges, but most of all the COVID surge decimated our operations and ability to collect in-person signatures. We want to thank our local Supervisors of Elections and staff members for their diligent work in verifying petitions. We will be considering all options in the months ahead to ensure that Floridians have the opportunity to bring safe and legal sports betting to the state, along with hundreds of millions of dollars annually to support public education.”

Anti Sports Betting

  • Christian Ulvert, Magic City Casino spokesperson: “Last night’s ruling was a victory for family-owned businesses like ours who pay their fair share in taxes and believe the free market should guide the business operations of gaming venues,” said Christian Ulvert, Magic City Casino spokesperson, who also commended their legal team at the Boise Schiller law firm. “The judge clearly understood the blatant violation of IGRA as her ruling demonstrates. We look forward to working with the governor, Legislature, and the citizens of Florida to pave a path forward that ensures a fair gaming marketplace exists in Florida.”
  • John Sowinski, executive director of No Casinos: “This ruling says what should’ve been obvious to everyone from the beginning — that Florida’s Constitution gives only Florida voters, not politicians in Tallahassee and Washington, the power to expand gambling in our state,” said John Sowinski, executive director of No Casinos, the anti-gambling non-profit that which backed the voter-approved 2018 constitutional amendment.
  • Norman Braman, a Miami billionaire who has led a years-long battle against expanded gambling in Florida, called the decision a “big win for our community and our state.” “This is not what the state of Florida is,” Braman said. “We are growing here. People are coming here to our state and our community. We are developing a high-tech industry here. Casino gambling and an extension of gambling is not what this community is all about.”

Conclusion

The compact relied on the “hub and spoke” model for online sports betting in an attempt to get around the limitations of the Florida Constitution, which requires voter approval for expanded gambling outside of a tribal compact. The computer servers would exist on tribal lands as the “hub” and the “spokes” are the mobile devices and contracted pari-mutuel permitholders used to place bets. While the court held that this particular method circumvents the IGRA that permits gambling to occur physically on tribal lands, perhaps the Seminole tribe can learn from this “fiction” and design the next compact to follow a different “hub and spoke” model that does not violate the IGRA, such as those executed on tribal lands Wisconsin and Washington State.