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Judge Denies NJ’s Request To Dismiss Leagues Lawsuit Over Sports Gambling

Trump Taj Mahal and other casino hotels in Atlantic City, New Jersey (file/credit: SAUL LOEB/AFP/Getty Images)

Trump Taj Mahal and other casino hotels in Atlantic City, New Jersey (file/credit: SAUL LOEB/AFP/Getty Images)

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NEWARK, N.J. (CBSNewYork/AP) — New Jersey’s battle with the four major professional sports leagues and the NCAA will continue after a judge on Friday rejected arguments that the leagues couldn’t prove they would be harmed if the state moves ahead with its plans to allow sports gambling.

In denying the state’s request to dismiss the lawsuit by the NBA, NHL, NFL, Major League Baseball and the NCAA, U.S. District Judge Michael Shipp agreed that they have standing to file the suit because expanding legal sports betting to New Jersey would negatively affect perception of their games.

In his ruling, Shipp cited studies offered by the leagues that showed fans’ negative attitudes toward game-fixing and sports gambling.

“While most of these studies alone may not constitute a direct causal link between legalized gambling and negative issues of perception on the part of Plaintiffs’ fans, sufficient support to draw this conclusion exists,” Shipp wrote.

New Jersey also has argued in court papers that a 1990s law prohibiting sports gambling in all but four states is unconstitutional, and Shipp ordered that a date for oral argument on that issue will be issued after Jan. 20.

New Jersey missed a 1991 federal deadline to legalize sports betting, and it was left out of the 1992 law that allowed it in Nevada, Delaware, Oregon and Montana.

The federal law prohibited sports gambling in all states but Nevada, where bettors can gamble on single games. New Jersey has argued the law usurps the authority of state legislatures and discriminates by “grandfathering” in some states.

The state’s voters said back in November 2011 that they want the legal right to bet on football, baseball and other sports, provided a federal ban is lifted.

The sole statewide question on the ballot was favored by 65 percent of voters. The non-binding question asked whether New Jersey should pass a law that would be the first step toward permitting sports betting at Atlantic City casinos, the state’s four horse tracks and a former racetrack site in Cherry Hill.

Sports betting proponents want to help Atlantic City’s 11 struggling casinos and the state’s four racetracks: the Meadowlands in East Rutherford, Monmouth Park in Oceanport, Freehold Raceway and Atlantic City Race Course in Mays Landing. They say legal sports betting also would provide a new source of tax revenue from a huge pool of money that now flows untaxed to unlicensed offshore Internet sites or to illegal bookmakers, many of whom are allied with organized crime

The leagues filed suit in August after Gov. Chris Christie vowed to defy a federal ban on sports wagering. Christie signed a sports betting law in January, limiting bets to the Atlantic City casinos and the state’s horse racing tracks.

New Jersey has said it plans to license sports betting as soon as January, and in October published regulations governing licenses. But the state agreed to give the leagues 30 days’ notice before it grants any licenses and hasn’t done so yet, the state attorney general’s office said last week.

The state, represented by former U.S. solicitor general Theodore Olson, had argued before Shipp last Tuesday that the leagues are as popular as they’ve ever been despite the existence of legal gambling in Nevada and more widespread illegal gambling.

The NCAA has said it will relocate several championship events scheduled to be held in New Jersey next year because of the state’s sports gambling push.

NFL spokesman Brian McCarthy declined comment on the ruling, telling The Associated Press on Saturday that “the decision speaks for itself.” Stacey Osburn, director of public and media relations for the NCAA, said it was “pleased with the court’s ruling.”

(TM and Copyright 2012 CBS Radio Inc. and its relevant subsidiaries. CBS RADIO and EYE Logo TM and Copyright 2011 CBS Broadcasting Inc. Used under license. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed. The Associated Press contributed to this report.)