BREAKING: New Jersey Seeks Modification of Sports Betting Injunction; Could Lead to Legal Sports Betting in New Jersey's Casinos and Racetracks

Earlier this morning, New Jersey officials took two actions designed to fast-track "legal" sports betting in New Jersey. First, the New Jersey Attorney General issued a Formal Opinion concluding that "sports [betting] pools operated by casinos or racetracks continue to be exempted from criminal liability under New Jersey so long as no wagering occurs on a college sport or athletic event that takes place in New Jersey or in which any New Jersey college team participates regardless of where the event takes place." As part of that Formal Opinion, the New Jersey Attorney General also issued a directive to all New Jersey Law enforcement personnel, including local prosecutors, police, and sheriffs, that prohibitions against sports wagering in casinos and racetracks would no longer be enforced. While acknowledging that New Jersey was enjoined by a federal court from "implementing" its Sports Wagering Law, the  the Attorney General reasoned that by virtue of the "severability" provision contained in that law and the Third Circuit's recognition that PASPA does not prohibit states from repealing their criminal prohibitions against sports betting, "the central provisions of the [Sports Wagering Law] that establish that casinos and racetracks may operate sports pools remain in effect and exempt such activity from criminal and civil liability."

At the same time, New Jersey also filed a motion with U.S. District Judge Michael A. Shipp, the federal judge who entered the injunction against New Jersey in February 2013. The motion seeks a "clarification" of the injunction to explicitly recognize that New Jersey is not obligated to maintain the criminal prohibitions against sports wagering on its books and that the Attorney General's opinion "permissibly recognizes" that the "surviving" portions of New Jersey's Sports Wagering Law "exempt certain sports wagering activities in casinos and racetracks from civil or criminal liability." The motion also seeks to "modify" the injunction by including new language stating that the injunction "does not prohibit, and shall not be construed to prohibit, [New Jersey public officials] from recognizing or giving effect to a provision of state law that repeals prohibitions or restrictions on sports wagering activity."

A decision on New Jersey's latest motion is expected sometime in October. The Court has already indicated that the motion is "set for 10/6/14 before Judge Michael A. Shipp" and "will be decided on the papers." New Jersey had requested oral argument in its motion, but its request was denied by the district court. Not a good sign. This should lead to a relatively quick decision. As first reported by Christopher Soriano, a gaming attorney with Duane Morris, the leagues' and DOJ's response to the motion is due on September 22, 2014, with New Jersey's reply brief due on September 29, 2014. Based on this expedited briefing schedule (which is standard for New Jersey federal practice), I would expect to see a ruling by mid-October. Of course, this does not take into account the possibility of an appeal. For example, if Judge Shipp denies New Jersey's motion, look for New Jersey to appeal that decision to the Third Circuit. Likewise, if he modifies the injunction in the manner requested by New Jersey, the NBA and the other pro sports leagues will undoubtedly appeal that order, no matter what Adam Silver may have said on Friday.

My analysis of New Jersey's latest gambit appears in Law360 (subscription required) and Meadowlands Matters, and I will update this post later today or tomorrow to provide a more complete legal analysis, including an assessment of New Jersey's chances for success before the district court (and the Third Circuit).