SCOTUS Strikes Down PASPA in Murphy v National Collegiate Athletic Association

In Murphy v. National Collegiate Athletic Association, 584 U. S. ____ (2018), the U.S. Supreme Court struck down the Professional and Amateur Sports Protection Act of 1992 (PASPA). The decision clears the way for states like New Jersey to legalize sports betting.

Facts of Murphy v. National Collegiate Athletic Association

The Professional and Amateur Sports Protection Act (PASPA), enacted in 1992, specifically prohibits governmental entities, including the states, from authorizing sports wagering. It also authorizes professional and amateur sports organizations, as well as the United States Attorney General, to file lawsuits to enforce its provisions. Nevada, Delaware, Oregon, and Montana are the only states excluded under the law, although Las Vegas is the only state that currently offers extensive sports betting. Ironically, New Jersey had the opportunity to enact a sports gambling program during a one-year window before the statute took effect, but it failed to act in time.

In 2012, New Jersey passed a law establishing a regulatory regime for legalized for sports betting. The country’s major professional sports leagues and the NCAA filed a lawsuit, which was joined by the Department of Justice. In its defense, the state of New Jersey argued that the federal ban is unconstitutional. It specifically maintained that the power to regulate gambling and benefit from the revenue it generates should rest with the states and not the federal government. New Jersey further argued that the PASPA violates the equal protection clause of Fourteenth Amendment because it is not applied equally across all states.

The Third Circuit rejected the constitutional challenge and concluded that the state could not regulate sports betting without running afoul of the PASPA. However, the appeals court held that the states retained “much room . . . to make their own policy” and were free to “enforce the laws they choose to maintain.”

Seeking to comply with the Third Circuit’s decision, New Jersey passed a 2014 law that partially repealed state laws prohibiting sports wagering. Unlike the 2012 Law, the 2014 Act does not affirmatively license or authorize sports wagering or create a regulatory scheme around it. Rather, it “partially repeal[s] the prohibitions, permits, licenses, and authorizations concerning wagers on professional, collegiate, or amateur sports contests or athletic events.”

Nonetheless, the sports leagues again filed suit. In defending the second suit, New Jersey argued that it is unconstitutional for the PASPA to dictate the extent to which the States must maintain their prohibitions on sports wagering. Relying on New York v. United States, 505 U.S. 144 (1992), New Jersey argued that PASPA violates the 10^th Amendment, which prohibits the federal government from “commandeering” the states to enforce federal law. The Third Circuit upheld PASPA and went on to hold that “a [S]tate’s decision to selectively remove a prohibition on sports wagering in a manner that permissively channels wagering activity to particular locations or operators is, in essence, ‘authorization’ under PASPA.”

Supreme Court’s Decision in Murphy v National Collegiate Athletic Association

 The Supreme Court reversed. “PASPA’s provision prohibiting state authorization of sports gambling schemes violates the anti-commandeering rule,” the majority held. Justice Samuel Alito, Jr. wrote on behalf of the six-member majority.

According to the majority, PASPA does exactly what the 10^th Amendment seeks to prohibit. “It is as if federal officers were installed in state legislative chambers and were armed with the authority to stop legislators from voting on any offending proposals,” Justice Alito wrote. “A more direct affront to state sovereignty is not easy to imagine.” 

In reaching its decision, the Court rejected the argument raised by the federal government and sports leagues that PASPA simply preempted conflicting state laws and, therefore, did not run afoul of the 10^th Amendment. As Justice Alito explained, “Preemption is based on a federal law that regulates the conduct of private actors,” but here “there is simply no way to understand the provision prohibiting state authorization as anything other than a direct command to the States,” which “is exactly what the anticommandeering rule does not allow.”

The majority also acknowledged that the legalization of sports gambling is a controversial subject that is best left to Congress. “The legalization of sports gambling requires an important policy choice, but the choice is not ours to make. Congress can regulate sports gambling directly, but if it elects not to do so, each state is free to act on its own,” Justice Alito wrote. “Our job is to interpret the law Congress has enacted and decide whether it is consistent with the Constitution. PASPA is not.”