Following Trend, Arizona Pro Teams Get in On Sports Wagering Action

By Andrew J. Silver, Ifrah Law 

Early this spring, the Arizona state legislature passed a bill allowing for both online and retail sports wagering in the state, with it potentially going live in time for the 2021 football season. In the Arizona bill, 10 professional sports organizations in the state along with 10 Native American tribes are authorized to partner with operators to launch sports wagering operations. The professional sports organizations include the state’s four major sports franchises—the Diamondbacks, Cardinals, Suns, and Coyotes—in addition to the Phoenix Raceway and the TPC Scottsdale, which hosts the Waste Management Open golf tournament. In addition to partnering with online operators, the Arizona bill authorizes the sports organizations to open on-site retail sportsbooks. Arizona’s governor Doug Ducey signed the bill into law in April.

The move in Arizona to allow professional teams to directly participate as licensed sports wagering operators is not without precedent and, in fact, appears to be a trend, as Virginia’s legislation likewise allowed professional teams to partner with sportsbooks as licensed operators. Indeed, among the first sportsbooks to have launched in Virginia early this year was FanDuel, which is operating in a partnership with the Washington Football Team. (Although the Football Team plays its games in Landover, Maryland, its headquarters is actually in Ashburn, Virginia.)

More to the emerging trend, sports wagering legislation which passed the Ohio state Senate in May—like the Arizona and Virginia laws—provides for a preference for professional teams to have the opportunity to join in the action. In fact, the Cleveland Cavaliers already last month announced a partnership with Betway this past March. Although the Cavs-Betway arrangement provides for advertising at the Cavs’ stadium and on telecasts, it stands to reason that if Ohio ultimately enacts legislation allowing for teams to partner with operators as licensees, that partnership would be a natural one to go live with a sportsbook. Although the legislation has not yet been voted on in the Ohio House, it may be acted upon in the coming months.

Arizona and Virginia (with Ohio potentially next) are not the only states to have involved professional sports organizations in their sports gambling regimes. Indeed, the Washington, D.C. legislation similarly allowed for retail sportsbooks to open inside (or adjacent to) sports facilities in the District, with William Hill already operating a retail location at Capital One Arena (with an accompanying mobile application available within a two-block radius), and BetMGM has launched online operations within a two-block radius of Nationals Park (with a physical sportsbook to follow), and FanDuel is expected to launch at D.C. United’s Audi Field in the near future. Additionally, in Illinois—where sports wagering is already active—in-stadium sportsbooks are permitted under the legislation, and Maryland recently enacted a law that likewise provides for in-stadium wagering. But Arizona’s move—following in the footsteps in Virginia—to allow professional teams to partner with sportsbook operators to offer mobile wagering statewide is far more expansive than the states to have allowed in-arena sportsbooks.

Although professional sports organizations may today be thought of as natural partners with legal sports wagering operators, it is still somewhat amazing how quickly these arrangements have come to fruition. This is especially true considering it was mere years ago that the major professional sports leagues—together with the NCAA—remained opposed to legal sports wagering in litigation before the U.S. Supreme Court. The NCAA, unlike the professional leagues, remains opposed to sports wagering, but as more and more professional teams get a piece of the pie, one wonders whether the NCAA may one day see wagering partnerships as a way to bring in additional money to help combat its member-institutions having to shutter non-revenue sports.

In yet another sign of the times that may have been unheard of a few years back, the NFL announced partnerships with Caesars Entertainment, DraftKings, and FanDuel to be official sports betting partners of the league. And now, as fans gradually return to NFL and other leagues’ stadiums in a number of states in 2021 and beyond, opportunities to visit in-stadium sportsbooks—such as that already available at Washington, D.C.’s Capital One Area—may become commonplace, and the Grand Canyon State’s legislation has positioned Arizona’s professional sports franchises at the center of the action.

(Disclosure: My law firm represents the iDevelopment & Economic Association, a trade association that includes legal wagering operators and suppliers.)

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