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A gambling compact between the state of Florida and the Seminole Tribe of Florida, which allows for sports betting off tribal lands, will remain in place after the U.S. Supreme Court denied a petition for review filed by Florida casino operators. This decision will have a significant impact on states’ authority to regulate gambling, especially gambling facilitated by Indian Tribes, moving forward.
The casino operators’ dispute began in 2021, when the Seminole Tribe of Florida (Seminole Tribe) and the state of Florida entered a compact under the Indian Gaming Regulatory Act (IGRA), which is the federal law that regulates gaming on tribal land. Pursuant to that compact, the Seminole Tribe is permitted to offer online sports betting throughout Florida, regardless of whether the betting occurs on tribal land or elsewhere within the state. The compact became effective when the secretary of the Interior (secretary) failed to approve or disapprove it within 45 days of receipt.
Brick-and-mortar casino operators in Florida objected to the secretary’s action (or inaction) because, in their view, the compact violated federal law, including the IGRA, the federal Wire Act, the Unlawful Internet Gambling Enforcement Act (UIGEA), and the Fifth Amendment’s equal protection guarantee. As a result, they filed suit against the secretary in the U.S. Federal District Court for the District of Columbia, arguing that the secretary’s approval (through inaction) violated the Administrative Procedure Act (APA). [1] The Seminole Tribe moved to intervene, the secretary moved to dismiss for lack of standing and for failure to state a claim, and the plaintiffs moved for summary judgment. The court considered these motions together, along with parallel motions in another case involving a challenge to the same compact by property owners in Florida.[2] Ultimately, the district court granted summary judgment for the casino operator plaintiffs, finding that the compact “attempts to authorize sports betting both on and off Indian lands[,]” in violation of “IGRA’s ‘Indian lands’ requirement.”[3]
On appeal, the D.C. Circuit overturned the district court’s order, expressly rejecting the argument that the “IGRA requires the Secretary to affirmatively disapprove any compact that seeks to authorize gaming off Indian lands.”[4] In reaching this decision, the circuit court cited earlier Supreme Court precedent holding that the IGRA “‘regulate[s] gaming on Indian lands, and nowhere else.’”[5] Thus, the circuit court reasoned, “the IGRA does not prohibit a gaming compact … from discussing other topics, including those governing activities outside Indian lands.”[6] According to the D.C. Circuit, the compact itself “authorizes only the betting that occurs on the Tribe’s lands” and “in this respect it satisfied IGRA.”[7] The legality of placing bets outside of tribal land and within Florida, the court stated, was a question for the Florida state courts.[8]
While the district court did not address the Wire Act, UIGEA, and Fifth Amendment challenges, the circuit court nevertheless analyzed those claims, finding each challenge failed as a matter of law. Specifically, the circuit court noted that even if the secretary expressly approved the compact (instead of simply taking no action, as was the case), such action “would survive rational basis review” because it is rationally related to the promotion of the economic development of the Seminole Tribe and the purpose laid out in the IGRA to ensure “that the Indian tribe is the primary beneficiary of the gaming operation.”[9]
The secretary’s response to the petition for certiorari highlighted the Supreme Court’s decision in Michigan v. Bay Mills Indian Community, which the D.C. Circuit relied upon in support of the states’ “capacious authority to regulate tribal gaming outside Indian territory.”[10] Given the Supreme Court’s denial of the petition for review, state regulatory regimes will remain the primary authority governing gaming outside of tribal territory.
The Seminole Tribe formally launched the statewide reactivation of its sports betting program on December 7, 2023 and resumed revenue sharing with the state in January 2024. This revenue sharing is expected to result in a total of $4.43 billion in new revenues by 2029.[11]
[1] West Flagler Associates v. Haaland, 573 F. Supp. 3d 260 (D.D.C. 2021).
[2] Monterra MF, LLC v. Haaland, No. 21-cv-2513 (D.D.C.) (complaint filed Sept. 27, 2021).
[3] West Flagler Associates, 573 F.Supp.3d at 273.
[4] West Flagler Associates v. Haaland, 71 F.2th 1059, 1065 (D.C. Cir. 2023) (internal quotations omitted).
[5] Id. at 1061 – 62. (quoting Michigan v. Bay Mills Indian Cmty., 572 U.S. 782, 795 (2014)) (alterations in original).
[6] Id. at 1062. (internal quotations omitted) (emphasis in original).
[7] Id. at 1062.
[8] Id. (internal quotations omitted). The Florida Supreme Court has already refused to take up a challenge to the compact. West Flagler Associates, LTD., et al. v. Desantis, et al., No. SC2023-1333 (Denial of Petition filed March 21, 2021)
[9] Id. at 1070. (internal quotations omitted).
[10] West Flagler Associates, Ltd., No. 23-862 (Brief of Respondents filed May 13, 2024).
[11] Revenue Estimating Conference, Indian Gaming Revenues Executive Summary, Feb. 20, 2024, available at Executive Summary (state.fl.us).
