The Sports-Betting Crisis is the Supreme Court’s Fault

But gambling scandals involving individual players and coaches virtually disappeared after the enactment of the Professional and Amateur Sports Protection Act, or PASPA.. Congress passed the law in 1992, amid widespread concern about sports betting and its corrosive influence. Law enforcement, religious leaders and other civic groups supported the bans. Gary Bettman, the current commissioner of the NHL, had warned that “legalized sports betting places the game and players under a cloud of suspicion” and “turns fans into ‘split-point fans’” who care more about the betting lines than the games themselves.

PASPA had two main components. First, under Section 3702(1), the law prohibited a “governmental entity” from “sponsoring, operating, advertising, promoting, authorizing, or permitting by law or compacting” a sports betting operation. Second, under Section 3702(2), the law prohibited a “person” from “sponsoring, operating, advertising, or promoting, pursuant to law or the contract of a governmental agency,” a sports betting operation.

As a result, it was effectively illegal for states to run sports betting operations on their own or to legalize and license private sports betting. The law grandfathered existing legalized sportsbooks, allowing those in Nevada to continue operating, and opened a one-year window for states like New Jersey to do the same.