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Appeals court rejects the Seminole Tribe's efforts to block a ruling against online sports betting

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The future of sports betting in Florida remained rocky after a divided appeals court rejected the Seminole Tribe’s request to put on hold a federal judge’s ruling that scrapped a deal giving the tribe control over online sports betting throughout the state.

It was not immediately clear whether the Seminoles plan to suspend their online sports-betting operations after the appeals court’s decision.

The future of sports betting in Florida remained rocky on Friday, after a divided appeals court rejected the Seminole Tribe’s request to put on hold a federal judge’s ruling that scrapped a deal giving the tribe control over online sports betting throughout the state.

The tribe filed an emergency motion last week asking the U.S. Circuit Court of Appeals for the District of Columbia to stay U.S. District Judge Dabney Friedrich’s Nov. 22 ruling. Owners of two Florida pari-mutuels filed the lawsuit challenging the deal, known as a compact.

Friedrich decision found that U.S. Department of the Interior Secretary Deb Haaland, whose agency oversees tribal gambling, erred in allowing the compact to go into effect because it violates federal law. Friedrich’s ruling also rejected the tribe’s motions to intervene in the lawsuit, which was filed against Haaland and the Department of Interior, and have it dismissed.

After a flurry of court filings this week, a three-judge panel of the Washington, D.C.-based appellate court denied the Seminoles’ attempt to put Friedrich’s ruling on hold until their appeal is resolved.

“Appellant has not satisfied the stringent requirements for a stay pending appeal,” the order by Judges Cornelia T.L. Pillard and Justin R. Walker said. The order said Judge Judith W. Rogers would have granted a stay.

The appellate judges did not elaborate on their reasons, as is common in such decisions.

Gov. Ron DeSantis and Seminole Tribe of Florida Chairman Marcellus Osceola, Jr., signed the compact this spring. The Legislature approved it during a May special session, although some lawmakers and gambling experts questioned whether it would withstand legal scrutiny.

The “hub-and-spoke” sports-betting plan in the compact was designed to allow gamblers throughout the state to place bets online, with the bets run through computer servers on tribal property. The compact says bets made anywhere in Florida “using a mobile app or other electronic device, shall be deemed to be exclusively conducted by the tribe.” Under the compact, the tribe would ultimately pay billions of dollars to the state because of sports betting and other benefits, such as being able to offer craps and roulette at tribal casinos.

Owners of Magic City Casino in Miami-Dade County and Bonita Springs Poker Room in Southwest Florida challenged the compact in federal courts in Washington, D.C. and Tallahassee, alleging the sports-betting provision violates federal law and would have a “significant and potentially devastating” impact on their businesses. The Havenick family has owned the pari-mutuels for decades.

Amid the legal wrangling, the tribe quietly launched the Seminoles’ Hard Rock Sportsbook mobile-betting app on Nov. 1 and has continued to accept and process wagers following Friedrich’s ruling.

It was not immediately clear Friday night whether the Seminoles plan to suspend their online sports-betting operations after the appeals court’s decision.

“The Seminole Tribe is aware of today’s appeals court decision and is carefully considering the steps it will take as a result. Despite the decision, the Seminole Tribe looks forward to a hearing from the appeals court based on the appeal previously filed by the tribe and an expected appeal by the U.S. Department of Justice,” Gary Bitner, a spokesman for the tribe, said in an email.

Department of Justice lawyers said in a court document this week the government did not oppose the tribe’s emergency motion for a stay and that it had not decided whether to appeal Friedrich’s ruling.

Hamish Hume, an attorney who represents the pari-mutuels, told The News Service of Florida this week that the tribe’s online wagering operations were “not legally permitted” even before the three-judge panel’s decision was handed down Friday.

“While the tribe is not a party to the lawsuit, what they are doing is now illegal,” Hume said in a phone interview Tuesday.

Friedrich ruled that the compact’s sports-betting provision violated the federal Indian Gaming Regulatory Act, or IGRA, which lays out a framework for gambling activities that take place on tribal lands. While the plaintiffs had asked the judge to decide that the sports-betting portion of the deal was illegal, Friedrich vacated the entire compact.

“The only way they can offer online sports betting is based on an IGRA approval and that approval has been invalidated. They are therefore operating in violation of both federal and state law,” Hume said.

As the tribe pursues an appeal of Friedrich’s ruling, the pari-mutuel owners are appealing a decision by U.S. District Judge Allen Winsor, who dismissed the Florida-based lawsuit challenging the compact.

Winsor in October said the pari-mutuels did not have legal standing to sue DeSantis and state Department of Business and Professional Regulation Secretary Julie Brown over the gambling agreement. The pari-mutuels last week filed a notice that they were taking the case to the Atlanta-based 11th U.S. Circuit Court of Appeals.

The compact also faces additional scrutiny because some critics believe it does not comply with a 2018 constitutional amendment, known as Amendment 3, that requires statewide voter approval for future expansions of gambling.

Speaking to reporters after Friedrich’s ruling was issued last month, DeSantis said he negotiated the agreement with the tribe because he felt the state wasn’t receiving enough money under a previous deal with the Seminoles, whose Tampa casino is one of the nation’s most profitable.

Under the 30-year deal signed by DeSantis, the tribe agreed to pay at least $2.5 billion to the state over the first five years. The Seminoles paid $37.5 million to the state in October and another $37.5 million in November, according to court records.

The governor, a lawyer, acknowledged that the hub-and-spoke plan was an “unsettled legal issue.”

“They wanted to do the sports (betting), and so we said ‘fine.’ And the reason why I'd said that is because it would probably pass on a referendum anyways. And then if a company gets it, the tribe gets it anyways. So, we felt that that made sense,” he said.

The governor said the state, which is not a party in the lawsuit, would support an appeal by the federal government.

Dara Kam is the Senior Reporter of The News Service Of Florida.