Florida Gaming Compact Faces Lawsuit by Southwest Parimutuels

• Southwest Parimutuels Claims Florida Gaming Compact Violates State & Federal Laws
• Lawsuit Argues Compact Uses “Hub and Spoke” Loophole to Contradict the IGRA
• Seminole Gaming Spokesman Claims Lucrative Compact Fully Complies with the Law

Southwest Parimutuels Claims Gaming Compact Violates State & Fed Laws

Back in May, Florida Governor Ron DeSantis turned gambling heads by approving a historic 30-year tribal compact in the state, a contract that gives the Seminole Tribe of Florida exclusive rights to offer online and retail sports betting.

Once the compact is approved by the United States Department of the Interior, it would allow Florida to become one of the dozens of states now offers legal sports gambling, the deal guaranteeing at least $500 million in annual revenue payments to the state for the next three decades.

Starting on October 15, 2021, the compact allows anyone in Florida over the age of 21 to place and collect online wagers on sporting events “via the internet [or] web application” from anywhere in the state.

But because the 1988 Indian Gaming Regulatory Act (IGRA) only allows wagers to take place on the Seminole reservation, detractors of the deal claim this opens up a loophole based on where the computer servers are located.

Lawsuit Argues “Hub and Spoke” Loophole Contradicts the IGRA

Isadore Havenick, vice president for public affairs for the company filing the lawsuit, Southwest Parimutuels, claims that the deal is based on “legal fiction” that violates state and federal law.

“While we are fully supportive of Gov. DeSantis and his work to secure a new Seminole Compact, the lawsuit focuses on a very narrow aspect of the Compact — the legality of off-reservation and online sports wagering,’’

The loophole goes like this – since the computer servers that take in these wagers are located on the Seminole reservation using a “hub and spoke” model, those online bets are considered to be made on tribal lands which is perfectly legal to do under the new deal.

But the Havenick family’s parimutuel company Southwest Parimutuels, which is the owner of Miami’s Magic City Casino and the Bonita Springs Poker Room, claims that because these bets can be made on mobile devices from anywhere in the state, it contradicts the well-established legal precedent set by the IGRA.

Seminole Gaming Spokesman Claims Compact Fully Complies

Gary Bitner, the spokesperson for Seminole Gaming, has defended the compact, saying it not only complies with the law, it is also supported by Floridians by a ratio of 3-1, its guarantee of $2.5 billion in state revenue over the next five years being “the largest commitment by any gaming company in US History.”

But the fact that Florida punters would now be able to gamble from the comfort of their own couches is seen to violate the spirit of the law set by the IGRA and, as a result, would greatly affect the profits of the Sunshine State’s existing gambling entities.

The lawsuit filed by Southwest Parimutuels claims that just because the servers are located on Seminole land does not make bets placed all over the state legal, stating:

Contrary to the legal fiction created by the 2021 Compact and Implementing Law, a bet is placed both where the bettor and the casino are each located.

Though this type of litigation was expected, it needs to be settled soon if plans to meet the October 15 deadline to start legal Florida sports betting are to be kept.