Thursday, August 21, 2014

Daniel Wallach Joins Other Sports Law Experts at Boston Bar Association for Roundtable Discussion of Donald Sterling controversy

On Friday, August 8, Becker & Poliakoff shareholder Daniel Wallach joined Sports Illustrated's Michael McCann, sports litigator Alan Milstein, sports law professor Warren Zola, and sports tax guru Robert Raiola in Boston for a spirited discussion of the Donald Sterling legal controversy. The panel discussion was well attended, and, by all accounts, quite successful. The event was co-sponsored by the Boston Bar Association and the American Bar Association, and was a featured event of the ABA Annual Meeting. You can watch the video of the full panel discussion here. The passcode for the video is 16344.

Wednesday, August 20, 2014

Daniel Wallach Interviewed on SportsNet Toronto About Settlement in Steve Moore-Todd Bertuzzi Civil Lawsuit

B&P shareholder, Daniel Wallach, was interviewed on the "Brady and Walker" show on SportsNet590 to provide legal commentary on the settlement of the Steve Moore-Todd Bertuzzi civil lawsuit. The case had been scheduled to go to trial on September 8, and was one of the most closely-watched sports law cases in recent memory. The trial would likely have featured explosive testimony about the NHL's "revenge culture" and the role that it played in Mr. Bertuzzi's premeditated attack on Mr. Moore, which effectively ended his playing career. Mr. Wallach predicted that the settlement amount was likely in the "$10-20 million range," given Bertuzzi's assault conviction and Moore's career-earning potential, not to mention the NHL's desire to avoid harmful testimony. A link to the interview is attachedMr. Wallach's interview also caught the attention of Sports Law Blog, which posted the interview and called it "an outstanding listen." Click here to read the post.

Saturday, July 26, 2014

Daniel Wallach Interviewed on Bloomberg Radio About Donald Sterling Controversy

Becker & Poliakoff shareholder Daniel Wallach was a guest on Bloomberg Radio earlier this week to break down the latest legal proceedings involving Donald Sterling, as the fate of the NBA's Los Angeles Clippers hangs in the balance. Mr. Wallach spoke with June Grasso and Mark Mills on Bloomberg Radio's "Bloomberg Law" to discuss how the resolution of the California probate court proceeding between Mr. Sterling and his wife could impact the ownership situation of the Clippers and Mr. Sterling's ongoing legal battle against the NBA. The rebroadcast of the interview is available here. Bloomberg Law is a nationally-syndicated radio program which examines all aspects of the legal profession and invites prominent attorneys and legal scholars on the program to analyze major issues and cases in the news.

Friday, July 11, 2014

Daniel Wallach Invited to Serve as Panelist on Donald Sterling Sports Law Roundtable at Boston Bar Association on August 8

I am honored to be joining Michael McCann, the legal analyst for Sports Illustrated and, on a panel addressing the Donald Sterling saga, to be held at the Boston Bar Association on Friday, August 8, 2014, between 12:00 PM and 1:30 PM. Joining us on the panel will be Robert Raiola, Warren K. Zola and Alan Milstein. We will be discussing the latest developments in the Donald Sterling controversy and the legal, business and ethical issues relating to his pending ouster from the NBA. The efforts to remove Mr. Sterling from the NBA touch upon many different areas of law, including the right to privacy, constitutional law, antitrust law, contract law, tax law, probate law, rules of evidence, and the extent to which the courts will review the decisions of private associations like the NBA. Please join us for a wide-ranging discussion of Donald Sterling and the many issues that his saga poses for the law, business and ethics of sports. This event, which is free (that's right, free!) is co-sponsored by the Boston Bar Association and the American Bar Association's Tort Trial and Insurance Practice Section.

Daniel Wallach Quoted in Sports Illustrated on Donald Sterling Controversy

Becker & Poliakoff shareholder, Daniel Wallach, ventured away from his Koz on Gaming duties for a brief moment this week to contribute appellate law insights to a series of columns (here and here) penned by Sports Illustrated's legal analyst Michael McCann about the probate court proceedings between Donald Sterling and Shelly Sterling, with the fate of the NBA's Los Angeles Clippers hanging in the balance. Mr. Wallach, a board-certified appellate lawyer, was interviewed about the prospects for an appeal by Donald Sterling should he lose the probate court trial on the issue of whether he was properly removed as trustee to the Sterling Family Trust. Specifically, Mr. Wallach offered insight about whether Section 1310(b) of the California Probate Code would allow the sale of the Clippers to proceed even while Mr. Sterling appealed an adverse probate court ruling. As Dan told SI, it is not a foregone conclusion that the probate court would invoke Section 1310(b). While Section 1310(b) is an exception to the general rule that probate court orders are automatically stayed during an appeal, Mr. Wallach added that this exception is narrowly construed by California courts. To successful invoke the exception, Shelly would have to make an affirmative showing that "extraordinary circumstances" exist involving a risk of "imminent injury or loss." Dan questioned whether Shelly would be able to satisfy this high threshold in light of rising NBA franchise values and the prospect of an even higher sale price at a later date. Mr. McCann concluded the article with this quote by Dan: "No evidence has been adduced that the franchise would sell for less at a later date," suggesting that Shelly faces an uphill battle in persuading the court to permit the pending sale of the Clippers to close while Donald pursues his appellate remedies.

Wednesday, July 2, 2014

Daniel Wallach to Give Opening Remarks at ABA Annual Meeting Program on Sports Betting Legal Controversy; Will Introduce Panel Featuring Theodore Olson and SI's Michael McCann

Becker & Poliakoff shareholder, Daniel Wallach, who has been one of the nation's leading voices on the emerging issue of state-regulated sports betting, will give the opening remarks at one of the most eagerly-awaited continuing legal education (CLE) programs at this year's American Bar Association Annual Meeting in Boston, Massachusetts. The 90-minute program, entitled Game-Changer: The States' Big Gamble on Legalized Sports Betting, will be presented on Sunday, August 10, 2014, at 10:30 am, at the Hynes Convention Center in Boston. Panelists include former U.S. Solicitor General Theodore B. Olson, Erin Murphy, Gabe Feldman, and West Virginia Solicitor General Elbert Lin. The program will be moderated by Michael McCann, the award-winning Legal Analyst and Writer for Sports Illustrated and This CLE program, which was selected as one of the premier showcase events at this year's ABA Annual Meeting, is sponsored by the Appellate Advocacy Committee of the ABA's Tort Trial and Insurance Practice Section. Mr. Wallach, who conceived the program and prepared the written program materials, is Chair-Elect of the Appellate Advocacy Committee, and takes over as its Chair on August 10, 2014. The American Bar Association is one of the world's largest voluntary professional organizations, with nearly 400,000 members. The Tort Trial and Insurance Practice Section is one of the largest ABA entities, with over 26,000 members.

Monday, June 23, 2014

What's Next for New Jersey in the Wake of the Supreme Court's Denial of Certiorari in the NJ Sports Betting Case? An Analysis

The dream is over, at least for now. But is it? Earlier this morning, the United States Supreme Court declined to review New Jersey's challenge to the Third Circuit decision upholding the federal ban on state-regulated sports betting otherwise known as PASPA (an acronym for the federal statute entitled the Professional and Amateur Sports Protection Act of 1992). As disappointing as this judicial inaction is for proponents of state-sponsored sports betting, it was not unexpected. The Supreme Court grants certiorari in less than two percent of all cases--dismal odds, actually--and the scant few petitions that are granted invariably involve circuit splits, a feature which is lacking here.

But not all hope is lost. It bears emphasizing that the denial of certiorari is not a decision on the merits. It is simply the Supreme Court exercising its discretion not to hear the case. Thus, the Third Circuit's decision remains the highest-ranking decision on the constitutionality of PASPA, and the dissenting opinion from Judge Vanaskie (concluding that PASPA "violates principles of federalism") could be the catalyst that spurs other states (such as California and Minnesota) that have been closely monitoring New Jersey's efforts to enact their own sports wagering law similar to New Jersey's. They could then test the constitutionality of PASPA in a different federal circuit (such as the ultra-liberal Ninth Circuit, which covers California, or the Eighth Circuit, which includes Minnesota and which has occasionally proved to be unfriendly territory for the NFL). These states could use Judge Vanaskie's dissenting opinion (and the legal arguments raised by New Jersey) as a "playbook" for overturning PASPA. I do not foresee this as an immediate option, since it does not appear as if any other State (besides New Jersey and Delaware, which are both foreclosed by the Third Circuit's decision) has the appetite to withstand a heavy lobbying effort by the leagues, substantial legal costs (New Jersey's legal tab approached nearly $3 million -- hey, Ted Olson does not work cheap!), and a great deal of uncertainty in the years ahead just for the "puncher's chance" of overturning PASPA. It may be a few years before this mystery State reveals itself. California looked for awhile to be the best bet to emerge, but that was until Senator Roderick Wright, who had been pushing for such a law, ran into his own legal difficulties.

Looking more to the short-term, what other options exist for New Jersey and other states? One potential option is for Congress to amend PASPA to allow other States, such as New Jersey, an opportunity to license and regulate sports betting, similar to the one-year window that had been provided to New Jersey in 1993 under one of the exemptions to PASPA. As John Brennan reported earlier today, several New Jersey congressmen have already begun "imploring" their congressional colleagues to pass a new federal law allowing sports betting in New Jersey. I just don't see that happening. For one thing, gambling remains a very divisive issue, unlikely to find common ground on both sides of the political aisle. Indeed, if anything, Congress has remained hostile to gambling as of late, as evidenced by recent legislative efforts to reinvigorate the Wire Act so as to prevent States from authorizing and regulating online casino games and online poker. And, as long Harry Reid (D.-Nev.) remains Senate Majority leader, there is simply no way that he will allow Nevada to lose its "federal-blessed" sports betting monopoly.

Which brings us to the "Nuclear" option. Over the last few weeks, New Jersey State Senator Raymond J. Lesniak has made rumblings about repealing (or loosening) New Jersey's criminal prohibition against sports betting. Today, in the wake of the Supreme Court's denial of certiorari, Senator Lesniak quickly introduced legislation in New Jersey that proposes to eliminate the New Jersey statutory criminal prohibitions against sports wagering, but only with respect to the conduct of such activity at racetracks and casinos in New Jersey. It applies to no one else. In other words, today's bill is the mirror image of New Jersey's now-defeated Sports Wagering Law, which sought to "legalize" that activity at racetracks and casinos in New Jersey. Instead of "legalizing" it at those venues, Senator Lesniak now proposes to "decriminalize" it, but only at those two types of venues. Is there really a difference between the two statutory regimes, other than the absence of state regulatory oversight. Can New Jersey really succeed with this "end-run" around PASPA by repealing or modifying its criminal laws prohibiting sports betting, thereby paving the way for the opening of sports books without any regulatory oversight?

Technically, this would not be a violation of PASPA because the criminal prohibition against private persons (under Section 3702(2) of PASPA) is entirely derivative of a state's violation of Section 3702(1) for wrongfully issuing a sports betting license. Thus, if there is no "state-issued" license, then private entities would not run afoul of PASPA if they were to open up unregulated sports books in New Jersey. But this sure seems like a blatant "end-run" around PASPA, especially since the proposed legislation, rather than proposing a complete decriminalization of sports betting in New Jersey (as Senator Lesniak had hinted at), simply loosens the restrictions for only two classes--casinos and racetracks--that were the sole intended licensees under New Jersey's now-defeated sports wagering law. Such a measure will surely lead to the leagues and the NCAA running to federal court to seek an injunction against the implementation of such a law.

Nonetheless, this bizarre legal strategy appears to find support in both the Third Circuit's written opinion and in recent statements made by federal government officials. The Third Circuit majority opinion states that "we do not read PASPA to prohibit New Jersey from repealing its ban on sports wagering." As the majority further explained, "under PASPA, on the one hand, a state may repeal its sports betting ban, a move that will result in the expenditure of no resources or effort by any official. On the other hand, a state may choose to keep a complete ban on sports gambling, but it is left up to each state to decide how much of a law enforcement priority it wants to make of sports gambling, or what the exact contours of the prohibition will be. We agree that these are not easy choices. And it is perhaps true (although there is no textual or other support for the idea) that Congress may have suspected that most states would choose to keep an actual prohibition on sports gambling on the books, rather than permit that activity to go on unregulated. But the fact that Congress gave states a hard or tempting choice does not mean that they were given no choice at all, or that the choices or otherwise unconstitutional."

In briefing before the Supreme Court, the U.S. Solicitor General also stated that this legal maneuver--even if it were to result in a complete repeal of New Jersey's criminal prohibition against sports betting--would nonetheless not violate PASPA. As Senator Lesniak's proposed legislation notes, "on page 11 of his brief, the Solicitor General states that the Professional and Amateur Sports Protection Act (PASPA), 28 U.S.C. 3701 et seq. 'does not even obligate New Jersey to leave in place the state-law prohibitions against sports gambling that it had chosen to adopt prior to PASPA's enactment. To the contrary, New Jersey is free to repeal those prohibitions in whole or in part.'"

Likewise, at the June 26, 2013 oral argument before the Third Circuit, Paul Fishman (the United States Attorney for the District of New Jersey) actually conceded that New Jersey could repeal its prohibition against sports betting without violating PASPA:
MR. FISHMAN:  Mr. Olson [counsel for Governor Christie] said they can't change the law, they have to enforce the law on the books, they have to keep it illegal. None of that is true. . . . It is up to the State of New Jersey to determine for itself the extent to which it will or will not enforce that law. . . . 
THE COURT:  So New Jersey could repeal its ban on wagering on sporting events?
MR. FISHMAN:  As a matter of law it could. It would be incredibly irresponsible. 
THE COURT:  It would not violate PASPA?   
MR. FISHMAN:  No. But the reason it hasn't been done for 20 years or a hundred years is not because of PASPA. It hasn't been done because it's a really, really, really bad idea. It's irresponsible, it would be bad policy to just allow gambling to go unfettered. . . .
(Transcript, at pp. 66-68)

So, there you have it. If New Jersey desires to "repeal" its criminal prohibition against sports betting, it has the blessing of the United States Solicitor General, the United States Court of Appeals of the Third Circuit, and the United States Attorney for the District of New Jersey. That's a pretty powerful blessing. The problem, however, is that Senator Lesniak is not attempting to repeal the criminal prohibition in toto; rather, he is just simply trying to release only New Jersey's casinos and racetracks from the law's clutches. Such a law too closely mimics the now-vanquished New Jersey Sports Wagering Law in that both laws would permit only New Jersey's casinos and racetracks to conduct sports wagering. Rather than double-down on the federal government's offer, Senator Lesniak has taken only a "half-measure" (to quote the late Mike Ehrmantraut from "Breaking Bad" fame), or, more, accurately, a "1/100th measure." By limiting the repeal of New Jersey's sports betting prohibition to racetracks and casinos, Senator Lesniak's proposed bill--if passed by the Legislature--would likely be struck down by the federal courts, bringing us back to square one. Is such a gambit really worth the time, knowing the likely result?

Senator Lesniak's bill faces additional obstacles as well. First, he must get it through the divisive New Jersey Legislature. After spending nearly $3 million in an unsuccessful effort to overturn PASPA, New Jersey legislators may not have the stomach for another costly legal battle, particularly to defend a law that does not go nearly as far as the Third Circuit's and DOJ's suggestion. Further, it remains to be seen whether Governor Christie--who harbors presidential ambitions and has had his own problems of late--would sign such controversial legislation despite championing New Jersey's efforts to topple PASPA. Having had his fill of recent controversies, I suspect that Governor Christie--who is frequently at odds with Senator Lesniak--would not sign that legislation into law.

Finally, and most importantly, it is highly unlikely that the owners and operators of New Jersey's casinos and racetracks (many of whom are licensed in other jurisdictions, such as Nevada) would jeopardize their valuable out-of-state licenses by opening up sports books solely in reliance on New Jersey's limited repeal of its sports betting prohibition. The gaming commissions in other states would not look too kindly on this "end-around" by New Jersey, and could rescind the gaming licenses of any operator that is found to have engaged in sports-based wagering in New Jersey, notwithstanding any limited repeal of that law. At a minimum, those operators will first wait to see if Senator Lesniak's legislation--assuming it is passed by the Legislature and signed into law--withstands judicial scrutiny. And, even then, a careful operator might be wise to seek an advisory opinion from the out-of-state gaming commission. Thus, even if Senator Lesniak's gambit succeeds, it may be a several years before we see the first sports book in New Jersey.