New Jersey scoffs at leagues’ pursuit of integrity/royalty fees


new-jersey-scoffs-leagues-sports-betting-feesThe major sports leagues had a mixed reception at separate sports betting discussions in New Jersey and New York on Monday.

Monday saw committees in each of New Jersey’s legislative chambers approve their respective sports betting bills, paving the way for a vote by the full legislature, possibly as early as Thursday (7). Gov. Phil Murphy is expected to sign the bill into law the following day.

The bills advanced despite fierce opposition from representatives from several pro sports bodies, including Major League Baseball, the National Basketball Association and the PGA Tour. The leagues are requesting/demanding a 0.25% cut of all sports wagers, ostensibly to fund ‘integrity’ efforts but, in reality, an opportunistic cash grab based on the leagues’ perceived intellectual property rights.

The league reps were excoriated by Assemblyman Ralph Caputo, a longtime gaming advocate who didn’t mince words in slamming the leagues’ “disgraceful” attempt to turn the state’s recent victory at the US Supreme Court into an obligation to line the pockets of those who so vehemently opposed the state’s multi-year legal betting quest.

Caputo (pictured, helmetless) called out the leagues’ “hypocrisy,” adding that the leagues “may want to write a check” to cover the $9m legal tab the state ran up in its fight against the leagues’ legal obstructionism.

When an MLB compliance rep claimed the lack of an integrity fee in the New Jersey legislation “does not give us the tools we need to protect our national pastime,” Caputo scoffed, saying “the tool you’re looking for is money. That’s not going to happen.”

The leagues appeared to suggest that they could file further legal challenges to block New Jersey should the state not give in to the leagues’ demands. Naturally, this threat was couched in the ‘hope’ that negotiation would do the trick, but that’s along the lines of ‘nice house you got here; shame if something were to happen to it.’

MLB brought along former pitcher Al Leiter to submit some truly dodgy claims regarding the leagues’ desire to restrict some types of in-play wagers. Leiter claimed integrity fees were necessary because sportsbooks would be taking $500k action on whether an opening pitch would be a strike or a ball, a scenario that had actual bookmakers rolling in the aisles.

The leagues have also pushed for licensed bookmakers’ mandatory use of league-supplied data, and an unidentified MLB rep recently told The Hill that such an arrangement would “help curb people betting illegally offshore, including having agreements with data suppliers so that they can’t provide data to illegal sportsbooks.”

New Jersey’s legislation contains no requirement for its licensed sportsbooks to use a specific data supplier. The leagues currently don’t require Nevada’s legal sports betting operators to use specific data sources, nor do Nevada books pay the leagues any fees for ‘integrity’ or any other transparent falsehoods.

The leagues did score one victory on Tuesday, as the Senate amended its bill to require state gaming regulators to meet with the leagues before the final betting regulations are issued. Hopefully, the change was made only so that all the state’s public servants have the opportunity to taunt the leagues in person.

The leagues are getting a slightly more positive reception in New York, where legislators are contemplating two highly similar pieces of sports betting legislation, each of which contains the 0.25% cut of wagers for the leagues, capped at 2% of sportsbook operators’ revenue.

However, the Senate bill would require the leagues to file annual claims that demonstrate that this cut of wagering handle is actually being used for integrity purposes. Should state auditors find fault with the leagues’ integrity invoices, no money would be forthcoming.

Last week, former Yankees manager Joe Girardi met with New York legislators to advocate for the league’s data and fee demands. On Monday, MLB trotted out another former Yankees manager, Joe Torre, to lobby Gov. Andrew Cuomo, who has expressed reservations about the state approving sports betting before the legislature adjourns on June 20.