Florida Thoroughbred Breeders and Owners Association sued by unhappy member, Ebro Greyhound Track debate on whether greyhound racing should continue, and comparison between expanded gambling and expanded legalization of marijuana.
- According to the Ocala Star-Banner, The Florida Thoroughbred Breeders and Owners Association (FTBOA) has been sued by one of its members, who alleges multiple improprieties on the part of the FTBOA. The lawsuit includes allegations that the FTBOA has become too political, that the officers and directors have been elected improperly, and that the Legislature improperly designated the FTBOA as one of the state recognized horse racing associations in Florida. The Plaintiff formerly owned the land where Oxford Downs is located, and the FTBOA has filed a lawsuit against the current owners of Oxford Downs, as mentioned in a prior entry in this blog. The attorney for the Plaintiff is a partner in the Gretna facility which was granted a license for pari-mutuel barrel racing. The FTBOA also was a plaintiff in a lawsuit against the Gretna facility.
- An article in the Panama City (FL) News Herald contains a response by the owners of Ebro Greyhound Park to general allegations of animal cruelty in greyhound racing. Rick Hess’ family owns Ebro, and he defends thoroughbred racing, arguing that animal rights groups are trying to end thoroughbred racing in Florida, which would also hurt greyhounds and jobs. Carey Theil, the Executive Director of Grey2K USA Worldwide, a leading group seeking to end greyhound races, agreed with Theil’s statement that they are trying to eliminate greyhound racing, and went on to explain reasons that Theil believes greyhound racing should be eliminated.
- The Daytona Beach News-Journal published a column by Washington Post columnist Michael Gerson in which Gerson compares the growth of gambling to the growth of legal marijuana. Gerson states that both bring in new tax dollars and are supported in the name of personal liberty. Gerson states that “both find common ground in encouraging and exploiting the weaknesses and addictions of citizens.”
AP Publishes Article on Hard Times at Greyhound Tracks, and Florida Lottery Sets New Annual Sales Record
The AP published a good story on July 9 on the hard times facing racing at the greyhound tracks in Florida, using Flagler Dog Track (a/k/a Magic City Casino) as an example, quoting Izzy Havenick, a member of the family that has owned Flagler since the 1950’s. This blog has referenced Havenick before. The article discusses the move to decouple racing from casino gaming. The article quotes Lonny Powell , President of the Florida Thoroughbred Breeders and Owners Association (also previously discussed in this blog) expressing concerns about decoupling because of the precedent that it could set for Horse Racing.
According to the News Service of Florida, the Florida Lottery has set a new annual sales record of over $5.3 billion, with over $1.4 billion of that going to education funding.
Will the Florida racing dates wars between Hialeah and Gulfstream return? Fight between Florida Horsemen and Oxford Downs continues. Gaming financial news
- “Its Baaack…” For many years, a regular fight in Tallahassee was the Legislative battle over racing dates between Gulfstream Park and Hialeah Park. This finally ended when Hialeah ran its last thoroughbred race in 2001. Hialeah lost its pari-mutuel permit, and then returned as a quarter-horse track. However, according to the Fort Lauderdale Sun-Sentinel, Hialeah is once again considering thoroughbred racing. Although Hialeah says that it would like to work cooperatively with Gulfstream, those of us who went through racing date wars wonder if this is the first step towards a renewed racing date battle. Hialeah has also announced a $60 million dollar expansion to their Casino facility.
- The fight between United Florida Horsemen ( which includes the Florida Horsemen’s Benevolent and Protective Association, the Florida Thoroughbred Breeders and Owners’ Association, and the Florida Quarter Horse Association) and Oxford Downs continues, according to an excellent article by Carlos Medina in the Ocala Star-Banner. UFH contends that the Oxford track is not a real pari-mutual, just a front for a card room. “It’s preposterous. The State of Florida never ceases to amaze me”, … It’s a phony baloney deal they are pulling off.” said Kent Stirling, President of the FHBPA. The FTBOA has filed for an injunction, alleging that Marion County should not have permitted Oxford Downs to open. Tony Mendola, one of the owners of the track, disputes the allegations. Although Mendola admits that there is currently no clubhouse, permanent restrooms, concessions are limited to water and soda, and the races are minimal, he explains that once the card room and simulcasting are producing revenue, that the facility will improve.
- According to Bloomberg, Aristocrat Leisure Ltd. of Australia is buying Video Game Technologies, Inc, of Tennessee, for $1.3 billion dollars. This would increase Aristocrat’s number of gambling machines from 8,200 to 28,400.
- Moody’s Investors Service has downgraded its outlook for the United States gaming industry from stable to negative.
Casino shutdowns in Atlantic City highlight the peril of gambling saturation
IN THE BEGINNING, there was Las Vegas. A rib was taken from the side of Las Vegas, which became Atlantic City. Las Vegas and Atlantic City begat Tunica and Riverboats and Indian Casinos and Pennsylvania and on and on and on. Soon people (mostly gambling experts, analysts, and business owners) began wondering when all this begetting would start to cause problems with saturation in the gambling industry. We now know.
According to the Associated Press, Atlantic City, which started 2014 with 12 casinos, may be down to 9 casinos by the end of 2014. The Atlantic Club has already closed, Revel says that it will close unless another company purchases it, and Caesars Entertainment says that it plans to close down the Showboat Casino at the end of this August.
A look at the map of the Mid-Atlantic region helps to explain the woes of Atlantic City. New Jersey is surrounded by New York, Delaware, and Pennsylvania. Delaware has long had casino gambling, New York is adding it, and Pennsylvania has become the 600 pound gorilla of casino gambling in the east, second only to the 800 pound gorilla of Nevada. Maryland and Connecticut are also nearby, adding to the competition.
Although the ongoing expansion of casino gaming continues, and it is difficult to determine where and when saturation will occur, we now have a clear example that saturation can and will occur when there are too many gambling opportunities with too few gamblers.
U.S. Supreme Court ends New Jersey’s current hopes for Sports Betting.
The United States Supreme Court has ended the State of New Jersey’s current hope for sports betting, at least for now. The Supreme Court denied certiorari, and refused to hear an appeal from the Third Circuit Court of Appeals, which had upheld a lower court judge who ruled against the State. This ruling was expected by most experienced appellate attorneys. The Supreme Court rules against even hearing most appeals where there are not conflicting opinions from different Circuit Courts of Appeal, and there were not conflicting rulings here. By refusing to hear the appeal, the Supreme Court offered no opinion on the underlying merits of the lower court rulings (nor do I).
In 1992, the United States Congress passed the Professional and Amateur Sports Protection Act (PASPA) which prohibited sports wagering, but grandfathered in four states that had some form of sports wagering. Nevada had full sports wagering, while Delaware, Montana, and Oregon had certain limited sports wagering. New Jersey was given one year to opt in to sports wagering, but failed to do so at the time. In 2011, the voters of New Jersey approved a referendum placed on the ballot by the Legislature calling for approval of sports wagering. In 2012, Governor Chris Christie signed legislation permitting sports wagering in New Jersey. The NFL, NBA, MLB, NHL, and NCAA filed suit against New Jersey, alleging that the 2012 law violated PASPA. The Trial Court Judge ruled against New Jersey, and by a 2-1 vote the Third Circuit Court of Appeals upheld the Trial Judge.
State Legislators from New Jersey have pledged to continue the fight for sports betting by other methods, which may include asking the Federal Government not to enforce PASPA, asking Congress to amend PASPA, or trying to further change New Jersey laws in a way that could bring sports wagering to New Jersey in a way that would be consistent with PASPA.
DCA rules in favor of Magic City on Pari-mutuel permit, racing date battle between Gulfstram and Calder ends, New Cruise-to-Nowhere in Jacksonville, Steve Geller speeches
The last month has been very busy from both a gaming law perspective here in Florida, both in terms of new issues to deal with in Florida, as well as my own speaking schedule.
- The First District Court of Appeals in Florida has recently entered a ruling on a long-standing dispute over whether West Flagler Associates, Ltd. In Miami, the parent company of Magic City Casino, is entitled under Florida law to one or more summer jai-alai permits under a law that has existed for many years, but has not been used until the last three or four years. There have been different interpretations of this law, and the DCA entered an order overruling the interpretation of the Florida Division of Pari-Mutuel Wagering. According to Miami Today, The DCA ordered the DPMW to reconsider its ruling; it is not clear whether the DPMW will actually issue the permit. As of the time of writing this blog, it is not clear whether either side will seek to appeal the ruling to the Florida Supreme Court. A similar case involving an application from Hialeah Park is currently pending in front of the Third DCA.
- The battle over thoroughbred racing dates in Miami Dade County has existed since before the County was called Miami Dade County. It now appears to be over. Originally, this was a three way battle between Hialeah, Gulfstream, and Calder racetracks. Hialeah then ceased thoroughbred racing, and Gulfstream and Calder remained to fight. Now, according to the Tampa Times, the parent company of Gulfstream (the Stronach Group), and the parent company of Calder (Churchill Downs) have reached an agreement where Churchill Downs will no longer operate thoroughbred racing at Calder. Instead, the Stronach Group will operate the racing dates located at Calder, while Churchill Downs will continue to operate the casino operations at Calder. Under Florida law, there must be a minimum of 40 days of thoroughbred racing at Calder for them to continue to keep their cardroom and casino permits. This deal also provides for Churchill Downs to sell its 50% stake in HRTV (a racing broadcast network) to Stronach.
- According to Jacksonville.com (the Florida Times Union), a new gambling boat based in Mayport is set to begin operations. Cruises to Nowhere are governed by the Johnson act. Gambling is only permitted outside of the territorial limits of the United States (three miles from Jacksonville). While South Florida was once home to many Cruises to Nowhere, the presence of Indian and pari-mutuel casinos has greatly diminished the presence of Cruises to Nowhere in Florida.
- According to multiple news sources, Sheldon Adelson , casino magnate from the Las Vegas Sands, has contributed $2.5 million dollars to the Drug Free Florida Committee, a group formed to oppose Amendment Two to the Florida Constitution. Amendment Two would permit the legal use of Medical Marijuana. The major committee funding efforts to pass Amendment Two is United for Care. John Morgan is both the major funder of United for Care, and is the senior Partner of Morgan and Morgan, the firm which employs and has been so helpful to Governor Charlie Crist. Adelson has been a substantial contributor to Governor Rick Scott. It is widely speculated that Adelson’s contribution to Drug Free Florida is designed to help Scott in his reelection campaign.
- I have had a busy early summer. On May 20 I was at the Borgata Hotel Casino in Atlantic City as the Moderator of the East Coast Gaming Conference panel entitled “Florida- Ripe for Major Expansion?” The Panelists were Florida State Representative Jim Waldman, the Ranking Democrat on the Florida House Gaming Committee; Isadore (“Izzy”) Havenick, VP of Magic City Casino and Naples /Fort Myers Dog track; Lonny Powell, CEO of the Florida Thoroughbred Breeders and Owners Association; and Rod Matamedi, Senior Economic Associate, REMI. I also attended the National Council of Legislators from Gaming States meeting at the Hyatt Regency Hotel in La Jolla, where I spoke on several committees. I spoke at the Pari-Mutuel Committee on innovations in pari-mutuel wagering, I gave the Committee on Casinos an update on enforcement in Florida of the ban on “Internet Cafes”, and I spoke to the State-Federal Relations Committee on the current state of federal Internet Gambling laws, and my prognosis for additional Federal Legislation this year. To the best of my recollection, this was the only time any speaker has spoken at three different committees at any NCLGS meeting.
Steve Geller, Esq., is the former Minority Leader of the Florida Senate, and a Shareholder at Greenspoon Marder, P.A. He served on the Gaming committees of the Florida Legislature during the entire 20 years that he served in the House of Representatives and Senate, including serving as Chair of the Committee. He is an “A-V” rated lawyer, and chairs the Gaming Law Practice Group at Greenspoon Marder, where he has represented State and National clients. Greenspoon Marder is a law firm with approximately 160 attorneys in Florida, and the Gaming Law Practice Group can call on the expertise of other attorneys in the firm, in areas such as transactional law, labor and employment law, litigation, appellate law, etc.