On September 24, 2019, the Third Circuit Court of Appeals found in favor of the New Jersey Thoroughbred Horsemen’s Association (“NJTHA”) and ruled that the NJTHA is entitled to recover the bond it posted as the result of a temporary restraining order (“TRO”) and subsequent preliminary injunction against the NJTHA in the 2014 case, National Collegiate Athletic Association v. Christie. The issue of recovering posted bond was a matter of first impression in the Third Circuit. The majority opinion, written by the Honorable Marjorie Rendell, concluded “wrongfully enjoined” under Federal Rule of Civil Procedure 65(c) can only be determined after a final judgment on the merits. Moreover, the court found a party is “wrongfully enjoined” when the final judgment concludes that party had a right all along to do what it was enjoined from doing. Also, in accordance with the majority of other circuits, the court found there is a rebuttable presumption that a wrongfully enjoined party is entitled to recover damages up to the bond amount.
On December 9, the Senate State Government, Wagering, Tourism & Historic Preservation Committee advanced S2935, a bill that would authorize “instant racing” to be offered at New Jersey racetracks, OTWs, and casino simulcast rooms.
Instant racing is a form of horse race wagering offered only at wagering terminals. The customer is offered a screen with horse numbers and past performance data, and the option to make traditional horse race bets. The race itself is a randomly selected, recorded race, often from many years ago. Because the track, date, and horse names are not identified, and the race is selected at random, it would be extremely difficult to identify the actual race so as to enable the customer to have the advantage of knowing the result.
Two bills working their way through the New Jersey Legislature would allow the use of mobile gaming devices for wagering at casinos and at state racetracks.
The first bill, S1323, passed by the Senate on May 31, would allow the Division of Gaming Enforcement to, by regulation, authorize the use of mobile gaming devices within a casino hotel. In order to engage in mobile gaming, the player must establish a wagering account with a casino, and the wagers must be placed from, and paid out, within the premises of the casino hotel. A mobile gaming device must be inoperable from outside of the casino hotel. The definition of hotel premises includes an outdoor pool and any outdoor recreation areas, but excludes parking lots. By regulation, the Division of Gaming Enforcement may impose stricter standards if it believes those standards are necessary. A version of this bill has passed the Senate, and a separate version is pending in the Assembly, so the two bills will need to be reconciled before final passage.
In an entry on April 11, we discussed a bid protest filed by an unsuccessful bidder who submitted a proposal in connection with New Jersey’s decision to lease Monmouth Park Racetrack to a private operator. A hearing took place on the protest on April 16. The hearing officer assigned to the protest recommended that the protest be overruled and that the lease of Monmouth Park to the New Jersey Thoroughbred Horseman’s Asssociation be permitted to go forward. On April 19, the New Jersey Sports and Exposition Authority (“NJSEA”) approved the hearing officer’s report, and on April 20 the Governor’s Office approved the report.
For many years, the State of New Jersey, through the New Jersey Sports and Exposition Authority, operated two racetracks – the Meadowlands and Monmouth Park. Within the last year, deals have been reached between the state and private operators, ending the NJSEA’s long history of operating racetracks (oftentimes at a financial loss).
Amid rumors of a potential closure of historic Monmouth Park, and the failure to reach agreement in 2011 with a private operator to lease the track from the state, a landmark deal was recently struck between the state and the New Jersey Thoroughbred Horseman’s Association. Under that deal, the Horseman’s Association will take over the operations of Monmouth Park under a long-term lease, beginning on May 3, 2012. Part of the Horsemen’s Association plan includes the use of some of the extra acres owned by the track to create a year-round destination that will hopefully be symbiotic with the racing that takes place at the track.
On January 17, 2012, New Jersey Governor Chris Christie signed a bill, now codified as P.L. 2011, c.228, which establishes a pilot program for wagering terminals at “eligible taverns, restaurants, and similar venues where food, alcoholic beverages, or both” are served for on-premises consumption –i.e, bars and restaurants.
The legislation provides that the New Jersey Racing Commission may issue a license to an entity that currently leases a state-owned racetrack, for the establishment at not more than 12 bars of not more than a total of 20 wagering terminals. Only one license may be issued, however, a licensed entity may enter into an agreement with another licensed entity that also has an agreement with the state for the lease or sale of a state-owned track to jointly implement this program. The Meadowlands lessee and Monmouth lessee may agree to jointly operate this program (or either can do it itself, but if one does, the other cannot).