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Appeals court rules against plan

8/24/2009

PHILADELPHIA -- A federal appeals court ruled Monday that
sports betting in Delaware would violate a 1992 federal ban on such
wagering, essentially halting the state's plans to start taking
bets next month.

The plan was opposed by the professional sports leagues and the
NCAA, which claimed it violated the federal Professional and
Amateur Sports Protection Act, would harm their reputations and
expose young people to gambling.

Delaware Gov. Jack Markell had pushed for sports betting as a
way to help resolve an unprecedented shortfall in state tax
revenues and balance the state budget. Attorneys who argued the
case for the state appeared stunned by the ruling.

"We're very disappointed with today's ruling," said Michael
Barlow, the governor's legal counsel.

Delaware was one of four states exempted from the federal ban on
sports betting because it once ran an NFL sports lottery in 1976
that required parlay, or multiple bets, on at least three games.

The 1992 law restricts sports betting to the four states that
met a deadline to sign up for it: Nevada, where Las Vegas sports
books determine the odds for sporting events across the country;
Delaware; Montana; and Oregon.

But the leagues argued that the exemption does not allow
Delaware to offer bets on single games, or on sports other than
professional football.

Speaking for the court, Judge Theodore McKee said Monday that
the betting plan as currently envisioned violates the federal ban.
The court was expected to issue a formal order later Monday,
followed by a written opinion later.

Barlow said Markell administration officials would have to
discuss whether to proceed next month with parlay bets on NFL
games, which the leagues concede are legal. Administration
officials also will meet with their lawyers to decide whether to
appeal the ruling to the full appeals court, or to the U.S. Supreme
Court.

The court heard almost two hours of argument from attorneys
regarding the denial of an injunction that would have prevented the
betting from beginning with the start of football season in
September.

But instead of ruling on the injunction, the appeals court
turned directly to the league's claim that sports betting would
violate the federal ban.

"We were hoping the court would rule on the merits," said
Kenneth Nachbar, an attorney representing the NFL, NBA, NHL, NCAA
and Major League Baseball.

During Monday's arguments, the judge questioned what would
happen if the state began sports betting in September, then had it
declared illegal by the district court several months later.
Individual bettors would have lost hundreds or thousands of dollars
on what essentially was an illegal state scheme, he said.

"What happens if you're wrong?" McKee asked Andre Bouchard, an
attorney representing the state.

"Caveat emptor," Bouchard replied, citing the Latin admonition
of "buyer beware."