In a 2-1 decision this morning, the United States Court of Appeals for the Third Circuit affirmed the District Court's decision that New Jersey's law partially repealing its prohibition against sports wagering violates the Professional and Amateur Sports Protection Act of 1992 ("PAPSA"). The Honorable Marjorie O. Rendell, who wrote Court's majority opinion, concluded that New Jersey's law "violates PASPA because it authorizes by law sports gambling."
Judge Rendell stated that "PASPA is constitutional and does not violate the anti-commandeering doctrine" – a holding the Third Circuit had already reached the last time New Jersey attempted to legalize sports betting in 2012. Then, despite noting that New Jersey had a "salutary purpose" of attempting to revitalize its casinos and racetracks, Judge Rendell acknowledged that the Court was bound to interpret PAPSA as Congress intended.
Ironically, to reach her conclusion that Congress intended to ban sports betting in New Jersey, Judge Rendell cited a one-year exemption from PAPSA granted to New Jersey when the law was enacted in 1992. That exemption would have permitted sports betting at New Jersey's casinos had New Jersey taken advantage of the exemption at the time (which it did not do). Judge Rendell held today that "by explicitly excepting a scheme of sports gambling in New Jersey's casinos from PAPSA's prohibitions, Congress intended that such a scheme would violate PAPSA."
Judge Rendell also stated that the fact that New Jersey's repeal is limited to racetracks and casinos "constitutes specific permission and empowerment," which runs afoul to PAPSA. Only a full-scale repeal would avoid conflicting with the statute.
Adding to the irony mentioned above, the Honorable Julio M. Fuentes, who authored the Third Circuit's prior opinion finding PAPSA constitutional, wrote a dissenting opinion. He failed to see Judge Rendell's logic when she concluded that a partial repeal constitutes an improper "authorization" under PAPSA, while a full repeal would not. Judge Fuentes instead recognized that "[a] repealed statute is treated as if it never existed; a partially repealed statute is treated as if only remaining part exists". Thus, after New Jersey enacted its repeal, "it is as if New Jersey never prohibited sports gambling in casinos, gambling houses, and horse racetracks."
Going forward, it is likely that New Jersey will Petition the Third Circuit for a rehearing en banc, which would result in full review by the entire Third Circuit if granted. If the Third Circuit declines to hold a rehearing en banc or affirms its panel's decision, New Jersey would likely Petition for Writ of Certiorari to the United States Supreme Court to have the Supreme Court review the constitutionality of its partial repeal. The fact that the same Judge who authored an opinion finding PAPSA to be constitutional dissented today indicates that an appeal would have at least some likelihood of success.
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