W. Flagler Assocs. v. Haaland
| Decision Date | 22 November 2021 |
| Docket Number | 21-cv-2192 (DLF), No. 21-cv-2513 (DLF) |
| Parties | WEST FLAGLER ASSOCIATES et al., Plaintiffs, v. Deb HAALAND, Secretary, U.S. Department of the Interior, et al., Defendants. Monterra MF, LLC et al., Plaintiffs, v. Deb Haaland, Secretary, U.S. Department of the Interior, et al., Defendants. |
| Court | U.S. District Court — District of Columbia |
Amy Lynn Neuhardt, Chloe M. Houdre, Samuel C. Kaplan, Hamish P.M. Hume, Boies, Schiller & Flexner, LLP, Washington, DC, Jon Lester Mills, Pro Hac Vice, Gainesville, FL, for Plaintiffs in 21-cv-2192 (DLF).
Eugene Ernest Stearns, Pro Hac Vice, Coral Del Mar Lopez Rosario, Pro Hac Vice, Grace Lee Mead, Pro Hac Vice, Jenea M. Reed, Pro Hac Vice, Stearns Weaver Miller Weissler Alhadeff & Sitterson, P.A., Miami, FL, Glenn T. Burhans, Jr., Pro Hac Vice, Robert Walters, Pro Hac Vice, Stearns Weaver Miller Weissler Alhadeff & Sitterson, Tallahassee, FL, Eli J. Kay-Oliphant, Sparacino PLLC, Chicago, IL, for Plaintiffs Monterra MF, LLC in 21-cv-2513 (DLF), Armando Codina in 21-cv-2513 (DLF), James Carr in 21-cv-2513 (DLF), Norman Braman in 21-cv-2513 (DLF).
Eugene Ernest Stearns, Pro Hac Vice, Coral Del Mar Lopez Rosario, Pro Hac Vice, Grace Lee Mead, Pro Hac Vice, Jenea M. Reed, Pro Hac Vice, Stearns Weaver Miller Weissler Alhadeff & Sitterson, P.A., Miami, FL, Glenn T. Burhans, Jr., Pro Hac Vice, Stearns Weaver Miller Weissler Alhadeff & Sitterson, Tallahassee, FL, Eli J. Kay-Oliphant, Sparacino PLLC, Chicago, IL, for Plaintiffs 2020 Biscayne Boulevard, LLC in 21-cv-2513 (DLF), 2060 Biscayne Boulevard, LLC in 21-cv-2513 (DLF), 2060 NE 2nd Ave., LLC in 21-cv-2513 (DLF), 246 NE 20th Terrace, LLC in 21-cv-2513 (DLF), No Casinos in 21-cv-2513 (DLF).
Rebecca M. Ross, Hillary Hoffman, U.S. Department of Justice Indian Resources Section, Environment and Natural Resources, Washington, DC, for Defendants.
DABNEY L. FRIEDRICH, United States District Judge In August 2021, the Secretary of the Interior approved a gaming compact between the State of Florida and the Seminole Tribe of Florida. The Compact authorizes the Tribe to offer online sports betting throughout the State, including to bettors located off tribal lands. In these related cases, the plaintiffs argue that the Compact violates the Indian Gaming Regulatory Act, the Unlawful Internet Gambling Enforcement Act, the Wire Act, and the Equal Protection Clause. They accordingly ask this Court to "set aside" the Secretary's approval of the Compact pursuant to the Administrative Procedure Act. 5 U.S.C. § 706(2)(A).
Before the Court are the plaintiffs’ Motions for Summary Judgment in both the West Flagler case and the Monterra case, Dkt. 19 (West Flagler ), Dkt. 37 (Monterra ); the Tribe's respective Motions to Intervene, Dkt. 13 (West Flagler ), Dkt. 31 (Monterra ); and the Secretary's respective Motions to Dismiss, Dkt. 25 (West Flagler ), Dkt. 35 (Monterra ).1 For the reasons that follow, the Court will hold that the Compact violates IGRA and grant the West Flagler plaintiffs’ motion for summary judgment. Additionally, the Court will deny the Monterra plaintiffs’ motion as moot, deny the Tribe's motions, and deny the Secretary's motions.
The Indian Gaming Regulation Act (IGRA) "creates a framework for regulating gaming activity on Indian lands." Michigan v. Bay Mills Indian Cmty. , 572 U.S. 782, 785, 134 S.Ct. 2024, 188 L.Ed.2d 1071 (2014). To that end, the Act divides gaming activities into three classes. See 25 U.S.C §§ 2710(a), 2710(d)(1). Class III gaming, the kind involved here, includes both casino games and sports betting. See id. §§ 2703(6)–(8); 25 C.F.R. § 502.4(c). To host class III gaming "on Indian lands," a tribe must "enter[ ] into" a compact with the state in which its lands are located. 25 U.S.C. § 2710(d)(1)(C). These compacts "prescribe[ ] rules for operating gaming, allocate[ ] law enforcement authority between the tribe and State, and provide[ ] remedies for breach of the agreement's terms." Bay Mills , 572 U.S. at 785, 134 S.Ct. 2024 (citation omitted). As relevant here, a compact may take effect only after the Secretary of the Interior has both approved its terms and noticed its approval in the Federal Register. See 25 U.S.C § 2710(d)(3)(B).
IGRA closely regulates the Secretary's review of gaming compacts. To start, it provides that the Secretary may disapprove a compact "only if [it] violates" another provision of IGRA, "any other provision of Federal law that does not relate to jurisdiction over gaming on Indian lands," or "the trust obligations of the United States to Indians." Id. § 2710(d)(8)(B). IGRA also provides that the Secretary must either approve or disapprove each compact within 45 days of receiving it. See id. § 2710(d)(8)(C). Otherwise, the compact shall "be considered to have been approved by the Secretary, but only to the extent the compact is consistent with" IGRA. Id. The D.C. Circuit has squarely held, first, that these default approvals are "reviewable" in federal court and, second, that the Secretary "must ... disapprove" unlawful compacts. Amador Cty. v. Salazar , 640 F.3d 373, 381–83 (D.C. Cir. 2011).
This case concerns a class III gaming compact between the State of Florida and the Seminole Tribe of Florida. See Compl. Ex. A (Compact), Dkt. 1-1 (West Flagler ). Before the Compact took effect, Florida law prohibited wagering on "any trial or contest of skill, speed[,] power or endurance." See Fl. Stat. § 849.14 (2020). Although that prohibition contained a narrow exception for horse racing, dog racing, and jai alai, see id. § 550.155(1), it barred betting on all major sports, including football, baseball, and basketball, see id. § 849.14 ; see also State of Fl. Amicus Br. at 1, 8, Dkt. 28 (West Flagler ). The Florida Constitution also limited the conditions in which the State could expand sports betting going forward. See Fl. Const. art. X, § 30 (a). Specifically, it provided that the State could only expand such betting through a "citizens’ initiative," id. §§ 30 (a)–(b), with the caveat that "nothing herein ... limit[s] the ability of the state or Native American tribes to negotiate gaming compacts" under IGRA, id. § 30 (c).
The compact in this case expanded the Tribe's ability to host sports betting throughout the State. In relevant part, the Compact defines "sports betting" to mean "wagering on any past or future professional sport or athletic event, competition or contest," Compact § III(CC); classifies "sports betting" as a "covered game," id. § III(F); and authorizes the Tribe "to operate Covered Games on its Indian lands, as defined in [IGRA]," id. § IV(A). The Compact also provides that all in-state wagers on sporting events "shall be deemed ... to be exclusively conducted by the Tribe at its Facilities where the sports book(s) ... are located," even those that are made "using an electronic device" "by a Patron physically located in the State but not on Indian lands." Id. § III(CC)(2); see also id. § IV(A) (). In this manner, the Compact authorizes online sports betting throughout the State. And because the State has not entered a similar agreement with any other entity, the Compact grants the Tribe a monopoly over both all online betting and all wagers on major sporting events. See Tribe's Mot. to Intervene at 1–3, Dkt. 13 (West Flagler ).
On June 21, 2021, the Secretary of the Interior received a copy of the Compact. See Compl. Ex. F (Approval Letter) at 1, Dkt. 1-6 (West Flagler ). Because the Secretary took no action on it within forty-five days, see id. , she approved the Compact by default on August 5, see 25 U.S.C § 2710(d)(8)(C). The next day, the Secretary explained her no-action decision in a letter to the Tribe. See generally Approval Letter. The letter reasoned that IGRA allows the Tribe to offer online sports betting to persons who are not physically located on its tribal lands. Id. at 6–8. To support that conclusion, the letter noted that IGRA allows states and tribes to negotiate the "allocation of criminal and civil jurisdiction," 25 U.S.C. § 2710(d)(3)(c)(i)-(ii), emphasized that Florida consented to the Compact, and argued that "IGRA should not be an impediment to tribes that seek to modernize their gaming offerings." Id. at 7. At the same time, the letter insisted that Florida residents could not place sports bets while "physically located on another Tribe's Indian lands." Id. at 8 & n.14 (emphasis added). To do so, it reasoned, would violate IGRA's instruction that gaming is "lawful on Indian lands" only if such gaming is authorized by the "Indian tribe having jurisdiction over such lands." Id. (quoting 25 U.S.C. § 2710(d)(1)(A)(i) ).
On August 11, the Secretary published notice of the Compact in the Federal Register. See Indian Gaming; Approval by Operation of Law of Tribal-State Class III Gaming Compact, 86 Fed. Reg. 44,037 (Aug. 11, 2021). At that point, the Compact took effect and acquired the force of law. See 25 U.S.C. § 2710(d)(3)(B). Pursuant to that Compact, as well as a Florida statute that implements its terms, see Fl. Stat. § 285.710(13)(b), online sports betting is now available in Florida. Although the Tribe initially represented that it would not offer such betting until November 15, see Pls.’ Mot. for Summ. J. Ex. C (Savin Decl.) ¶ 23, Dkt. 19-3 (West Flagler ), it in fact launched online betting on November 1, see Pls.’ Notice of Material Factual Development at 1 & Ex. A, Dkt. 39 (West Flagler ).
On August 16, plaintiffs West Flagler Associates and Bonita-Fort Myers Corporation brought a civil action to challenge the Secretary's approval of the Compact. See West Flagler Compl. Both entities own brick-and-mortar casinos in Florida. See Savin Decl. ¶¶ 3, 15. To establish Article III standing, they allege that the Compact's...
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