US 3rd Circuit's Ruling Against Delaware Sports Betting

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Published on:
Aug/31/2009

PRECEDENTIAL

UNITED STATES COURT OF APPEALS

FOR THE THIRD CIRCUIT

           

No.  09-3297

           

OFC COMM BASEBALL, an unincorporated association

doing business as Major League Baseball; NATL

BASKETBALL ASSN, a joint venture; NATL

COLLEGIATE ATHLETIC ASSN, an unincorporated

association; NATL FOOTBALL LEAGUE, an

unincorporated association; NATL HOCKEY LEAGUE, an

unincorporated association,

                                                                                                     

        Appellants,

v.

JACK A. MARKELL, Governor of the State of Delaware;

WAYNE LEMONS, Director of the Delaware State Lottery

Office,

                                                                                                    

       Appellees.

           

On Appeal from the United States District Court

for the District of Delaware

(D.C. No.  09-cv-00538)

District Judge:  Honorable Gregory M. Sleet

 

Argued August 24, 2009

Before: McKEE, FUENTES and HARDIMAN, Circuit

Judges.

(Filed: August 31, 2009)

Kenneth J. Nachbar [Argued]

Pauletta J. Brown

Megan W. Cascio

Susan W. Waesco

Morris, Nichols, Arsht & Tunnell

1201 North Market Street

P.O. Box 1347

Wilmington, DE 19899-0000

Attorneys for Appellants

Andre G. Bouchard [Argued]

Joel E. Friedlander [Argued]

Sean M. Brennecke

David J. Margules

Bouchard, Margules & Friedlander

Suite 1400

Wilmington, DE 19801-0000

Attorneys for Appellees

 

3

OPINION OF THE COURT

           

HARDIMAN, Circuit Judge.

In this interlocutory appeal we review an order of the

United States District Court for the District of Delaware denying

a motion for preliminary injunction filed by the National

Football League, the National Basketball Association, the

National Hockey League, the Office of the Commissioner of

Baseball, and the National Collegiate Athletic Association

(collectively, Leagues).  The Leagues sought to enjoin Delaware

state officials from implementing certain elements of its Sports

Lottery Act (Act), Del. Laws Ch. 28 (H.B. No. 100) (2009),  29

Del. Code § 4801 et seq., on September 1, 2009.  As we shall

explain, we need not decide whether the District Court's denial

of the Leagues' preliminary injunction was proper because we

hold as a matter of law that elements of Delaware's sports

lottery violate federal law.

I.

In March 2009, the Governor of Delaware, Jack Markell,

proposed legislation authorizing sports betting and table gaming

at existing and future facilities in Delaware.  On March 19,

Governor Markell sought an advisory opinion from the

Delaware Supreme Court pursuant to 10 Del. Code § 141 and 29

Del. Code § 2102, regarding the constitutionality of his proposal

under the Delaware Constitution.  In a letter to the Delaware

Supreme Court, Governor Markell described three types of

 

1

 Under regulations proposed pursuant to the Act,

Delaware intends to offer three games: Single Game Lottery,

Total Lottery, and Parlay Lottery.  In Single Game Lottery,

bettors must select the winning team in a single sports contest

against a point spread.  In Total Lottery, the bettor gambles on

whether the total number of points scored by both teams in a

single contest will be over or under a specified sum.  The final

game, Parlay Lottery, combines elements of the first two games

in asking bettors to correctly choose the winners of two or more

sports contests, or two or more over/under bets, or some

combination of winners and over/under bets.

4

proposed sports gambling: (1) point-spread bets on individual

games; (2) over/under bets on individual games; and (3) multi-

game parlay bets.1  On May 14 - while the request for an

advisory opinion from the Delaware Supreme Court was

pending - Governor Markell signed the Act into law.  In re

Request of Governor for an Advisory Opinion (In re Request of

Governor), --- A.2d ---, No. 150, 2009, 2009 WL 1475736, at *2

(Del. May 29, 2009).

After hearing oral argument, the Delaware Supreme

Court issued an opinion on May 29, which found that multi-

game betting would not violate state law.  In analyzing the

legality of the Act and the "lotteries" proposed pursuant to the

Act, the Delaware Supreme Court relied heavily on Judge

Stapleton's decision in National Football League v. Governor

of the State of Delaware (NFL), 435 F. Supp. 1372 (D. Del.

1977).  That case concerned the NFL's challenge to a sports

betting scheme known as "Scoreboard" that Delaware conducted

during the 1976 season.  Scoreboard was comprised of three

 

5 games: Football Bonus, Touchdown, and Touchdown II.  In

Football Bonus, the State offered two pools of seven NFL games

each and bettors had to predict the winners - without a point

spread - in one or both of the pools.  In Touchdown, bettors

selected both the winners and point spreads for either three,

four, or five NFL games.  Finally, Touchdown II - which

replaced Touchdown midway through the season - required

bettors to pick the winners, against the point spread, for between

four and twelve NFL games.  All of the Scoreboard games

conducted in 1976 were confined to betting on the NFL, and all

required that the bettor wager on more than one game at a time.

In NFL, Judge Stapleton held such wagering was

permissible under the Delaware Constitution because chance is

the "dominant factor" in multi-game (parlay) betting.  The

Delaware Supreme Court reached the same conclusion in its

advisory opinion, In re Request of Governor, 2009 WL

1475736, at *8, but did not decide the constitutionality of single-

game betting, except to recognize that it differs from the parlay

games addressed by Judge Stapleton.  Id.  The Delaware

Supreme Court did not address the federal statutory question

presented in this appeal.

Following receipt of the Delaware Supreme Court's

advisory opinion, on June 30 the State published its proposed

regulations to implement the Act (Regulations).  According to

the Regulations, Delaware intends to implement a sports betting

scheme that would include wagers "in which the winners are

determined based on the outcome of any professional or

collegiate sporting event, including racing, held within or

without the State, but excluding collegiate sporting events that

 

2

 The PASPA claim was brought at Count I.  The

Leagues also brought a claim under state law at Count II, which

alleged that the sports betting scheme violates Section 17 of the

Delaware Constitution because it does not constitute a

permissible "lottery."  The state-law claim is not at issue in this

appeal.

6

involve a Delaware college or university, and amateur or

professional sporting events that involve a Delaware team."

A168.  Delaware's proposed sports betting scheme includes

single-game betting in addition to multi-game (parlay) betting,

as the Regulations define the term "maximum wager limit" to

include "the maximum amount that can be wagered on a single

sports lottery wager be it head-to-head or parlay . . . ."  A168

(Regulations § 2.0, definition of "maximum wager limit")

(emphasis added).

Delaware intends to commence its sports betting scheme

on September 1, 2009, in time for the start of the upcoming NFL

regular season.  Though the NFL is its focus, Delaware intends

to conduct - and the Regulations sanction - betting on all

major professional and college sports.

II.

On July 24, the Leagues filed a complaint against

Governor Markell and Wayne Lemons, the Director of the

Delaware State Lottery Office (collectively, Delaware or State),

claiming that elements of Delaware's proposed sports betting

scheme violate the Professional and Amateur Sports Protection

Act (PASPA), 28 U.S.C. § 3701, et seq.2  Although PASPA has

 

7

broadly prohibited state-sponsored sports gambling since it took

effect on January 1, 1993, the statute also "grandfathered"

gambling schemes in individual states "to the extent that the

scheme was conducted by that State" between 1976 and 1990.

Four days after filing their complaint, the Leagues filed

a motion for preliminary injunction, requesting that the District

Court enjoin the State "from commencing, instituting, operating

and maintaining a proposed ‘sports lottery' to the extent that

such lottery permits (i) single-game sports betting, (ii) betting on

sports other than professional football, or (iii) any other sports

betting scheme that was not conducted by the State of Delaware

in 1976" pending final adjudication of the Leagues' action.

The District Court held a scheduling conference on July

29 at which it urged the parties to reach an agreement by which

the State would "stand down" pending an expedited adjudication

of the merits.  A268.  The parties could not reach such an

agreement, however, so the District Court asked for written

submissions and held a conference on August 5.  Following the

conference, the court orally denied the Leagues' motion and

scheduled a trial for December 7.  On August 10, the District

Court issued a 13-paragraph memorandum order explaining its

reasons for denying the injunction. 

In its memorandum order, the District Court found that

the Leagues had not shown a likelihood of success on the merits.

Office of Comm'r of Baseball v. Markell, --- F. Supp. 2d ---,

2009 WL 2450284, at *1 (D. Del. Aug. 10, 2009).  Noting that

"both sides vigorously and ably contend that they are entitled to

win on the merits," the District Court stated: "On the current

 

8

record, the court is simply not in a position to give either side a

nod on the merits.  Indeed, there may exist factual disputes as to

what, if anything, the State of Delaware actually did in the past

with respect to sports gambling; or as to what, if any, proposed

sports betting activities are exempted by the federal statute at

issue."  Id. at *2.  The District Court also noted that the Leagues

suggested in their letter brief that the court treat their motion for

preliminary injunction as a motion for summary judgment and

questioned whether the Leagues had demonstrated both the

requisite irreparable harm and that the balance of the equities

fell in their favor.  See id. at *2-4.

On August 7 - prior to receipt of the District Court's

memorandum opinion - the Leagues filed their notice of

appeal.  Three days later, the Leagues filed a motion to expedite

their appeal and their opening brief.  On August 12, Delaware

filed a motion to dismiss the appeal and its opposition to the

Leagues' motion to expedite.  On August 13, we granted the

Leagues' motion to expedite, issued a briefing schedule, and set

oral argument for August 24.

It is often noted that the wheels of justice move slowly -

and for good reason.  As the procedural history of this case

demonstrates, however, that is not always the case.  When a

party seeks injunctive relief, the stakes are high, time is of the

essence, and a straightforward legal question is properly

presented to us, prudence dictates that we answer that question

with dispatch.

III.

 

9

We begin, as always, by considering whether we have

jurisdiction to hear this appeal.  The Leagues claim we have

jurisdiction under 28 U.S.C. § 1292(a), which provides: "courts

of appeals shall have jurisdiction of appeals from: (1)

Interlocutory orders of the district courts . . . granting,

continuing, modifying, refusing, or dissolving injunctions."

(emphasis added).  The State disagrees, arguing that we must

apply the test set forth in Carson v. American Brands, Inc., 450

U.S. 79 (1981), which requires the Leagues to show that the

District Court's denial of the motion for preliminary injunction

(1) will have a serious, perhaps irreparable, consequence; and

(2) can be effectively challenged only by immediate appeal.  Id.

at 83; see also Stringfellow v. Concerned Neighbors In Action,

480 U.S. 370, 379 (1987).

In arguing that the Leagues must establish the Carson

factors, Delaware relies on dicta from some of our prior cases

stating that both orders expressly denying injunctions and orders

having the practical effect of denying injunctions must meet the

two-prong Carson test.  See Vuitton v. White, 945 F.2d 569, 574

(3d Cir. 1991); Ross v. Zavarella, 916 F.2d 898, 902 (3d Cir.

1990).  But none of the cases upon which Delaware relies

involved express denials of injunctive relief; rather, they dealt

with orders that were alleged to have the  practical effect of

denying injunctive relief.  Accordingly, the Leagues need not

demonstrate that the order will have a "serious, perhaps

irreparable, consequence" and can be "effectively challenged"

only by immediate appeal.  See Cohen v. Bd. of Trs. of Univ. of

Med., 867 F.2d 1455, 1464 (3d Cir. 1989).  The language of

§1292(a)(1) is clear and the Leagues need not satisfy any

3

 Section 2106 provides: "The Supreme Court or any

other court of appellate jurisdiction may affirm, modify, vacate,

set aside or reverse any judgment, decree, or order of a court

lawfully brought before it for review, and may remand the cause

and direct the entry of such appropriate judgment, decree, or

order, or require such further proceedings to be had as may be

just under the circumstances."

10

jurisdictional hurdle beyond the fact that they have appealed

from an order refusing to enter an injunction.

We next turn to the scope of our review under 28 U.S.C.

§ 1292(a).  We have adopted a broad view of appellate

jurisdiction under this section.  See Kershner v. Mazurkiewicz,

670 F.2d 440, 445 (3d Cir. 1982); see also 16 CHARLES ALAN

WRIGHT, ARTHUR R. MILLER & EDWARD H. COOPER, FEDERAL

PRACTICE AND PROCEDURE § 3921.1, at 28 (2d ed. 1996)

("Jurisdiction of the interlocutory appeal [under § 1292(a)(1)] is

in large measure jurisdiction to deal with all aspects of the case

that have been sufficiently illuminated to enable decision by the

court of appeals without further trial court development.").

Moreover, we have held that "[w]hen an appeal is taken from an

order made appealable by statute, we have all the powers with

respect to that order listed in 28 U.S.C. § 2106."3  United Parcel

Serv., Inc. v. U.S. Postal Serv., 615 F.2d 102, 107 (3d Cir.

1980).  Accordingly, we have broad authority to decide this case

as appropriate under § 2106.

Having determined that we have authority to address all

aspects of this case, we must determine whether it is proper to

exercise that authority.  "As a general rule, when an appeal is

 

11

taken from the grant or denial of a preliminary injunction, the

reviewing court will go no further into the merits than is

necessary to decide the interlocutory appeal."  Callaway v.

Block, 763 F.2d 1283, 1287 n.6 (11th Cir. 1985).  This

ordinarily requires that we review the decision to grant or deny

a preliminary injunction for abuse of discretion, employing the

standard four-factor test.  See Allegheny Energy, Inc. v. DQE,

Inc., 171 F.3d 153, 158 (3d Cir. 1999).  Nevertheless, the

Supreme Court has held the "general rule" of limited review is

one of "orderly judicial administration, not a limit on judicial

power."  Thornburgh v. Am. Coll. of Obstetricians &

Gynecologists, 476 U.S. 747, 757 (1986), overruled on other

grounds by Planned Parenthood of Se. Penn. v. Casey, 505 U.S.

833 (1992).

In Thornburgh, the Supreme Court considered whether

this Court properly exercised its jurisdiction in striking down

portions of a Pennsylvania statute following an appeal from the

district court's partial denial of a preliminary injunction.  See id.

at 755-57.  The Supreme Court acknowledged that review of a

preliminary injunction is normally limited to the injunction

itself, but explained: "if a district court's ruling rests solely on

a premise as to the applicable rule of law, and the facts are

established or of no controlling relevance, that ruling may be

reviewed even though the appeal is from the entry of a

preliminary injunction."  Id.  At the same time, the Supreme

Court cautioned: "A different situation is presented . . . when

there is no disagreement as to the law, but the probability of

success on the merits depends on facts that are likely to emerge

at trial."  Id. at 757 n.8.  In affirming this Court's decision to

 

12

address the merits of the plaintiff's case, the Supreme Court

quoted from our opinion:

Thus, although this appeal arises from a ruling on

a request for a preliminary injunction, we have

before us an unusually complete factual and legal

presentation from which to address the important

constitutional issues at stake.  The customary

discretion accorded to a district court's ruling on

a preliminary injunction yields to our plenary

scope of review as to the applicable law.

Id. at 757 (quoting Am. Coll. of Obstetricians & Gynecologists

v. Thornburgh, 737 F.2d 283, 290 (3d Cir. 1984)).

The approach taken in Thornburgh has been embraced by

a number of our sister courts of appeals.  In an appeal from the

grant of a preliminary injunction in Campaign for Family Farms

v. Glickman, 200 F.3d 1180 (8th Cir. 2000), the Court of

Appeals for the Eighth Circuit exercised its discretion to reach

the merits of the underlying dispute, determining that it was

"faced with a purely legal issue on a fixed . . . record."  Id. at

1186-87.  The court explained: "[t]he considerations that caution

against a broad scope of review in the usual interlocutory appeal

- that is, a tentative and provisional record with conflicting

material facts - simply are not present here."  Id. at 1187.

Likewise, in Solantic, LLC v. City of Neptune Beach, 410 F.3d

1250 (11th Cir. 2005), the Court of Appeals for the Eleventh

Circuit assessed the merits of the plaintiff's First Amendment

claim on appeal after the district court denied his request for a

preliminary injunction.  Finding that the facts of the case were

 

13

"simple and straightforward, and the record need[ed] no

explanation," id. at 1274, the court explained that "we do not

think it necessary or prudent to confine our opinion to holding

that [the plaintiff] has shown a likelihood of success on the

merits, when it is altogether clear that [the plaintiff] will succeed

on the merits of its First Amendment claims," id. at 1272

(emphasis in original).  Finally, in Doe v. Sundquist, 106 F.3d

702 (6th Cir. 1997), the Court of Appeals for the Sixth Circuit

considered the merits of the plaintiffs' claim following a denial

of their preliminary injunction motion.  The court noted that

"[i]f an issue unaddressed by the district court is presented with

sufficient clarity and completeness and its resolution will

materially advance the progress of the litigation," consideration

of that issue is proper.  Id. at 707 (internal quotation marks and

citation omitted).  The court explained that "[t]he sort of judicial

restraint that is normally warranted on interlocutory appeals

does not prevent us from reaching clearly defined issues in the

interest of judicial economy."  Id. (citation omitted).

In light of Thornburgh and its progeny, we must

determine whether the record in this appeal presents "a pure

question of law" that is "intimately related to the merits of the

grant [or denial] of preliminary injunctive relief," United Parcel

Serv., 615 F.2d at 107, or whether the Leagues' "probability of

success on the merits depends on facts that are likely to emerge

at trial," Thornburgh, 476 U.S. at 757 n.8.  For the reasons that

follow, we conclude that this case falls into the former category.

In denying the Leagues' motion for preliminary

injunction, the District Court hypothesized that "there may exist

factual disputes as to what, if anything, the State of Delaware

 

 

4

 Because we reach the merits of this case, we need not

consider the parties' arguments regarding irreparable harm and

the balancing of the equities.

14

actually did in the past with respect to sports gambling or as to

what, if any, proposed sports betting activities are exempted by

the federal statute at issue."  Markell, 2009 WL 2450284, at *2

(emphasis added).  Contrary to the District Court's supposition,

we have reviewed the record and cannot find any material issues

of fact in dispute.  As the Leagues rightly argue, Judge

Stapleton's opinion in NFL is the definitive word regarding the

scope and extent of Delaware's gambling scheme as it was

conducted in 1976; the State neither challenged Judge

Stapleton's findings 33 years ago nor does so now.  Likewise,

the parties do not dispute the scope and extent of the sports

gambling scheme that Delaware intends to implement on

September 1.  As counsel for Delaware properly and candidly

conceded at oral argument, the State intends to conduct

widespread betting on both professional and college sports

beyond the scope of the football-only parlays permitted in 1976.

In sum, the parties agree upon what Delaware did in 1976 and

what Delaware intends to do now.  Given the absence of any

disputed issue of material fact - as confirmed by both parties

at oral argument - we conclude that this case does not turn on

a "legal issue that might be seen in any different light after final

hearing," United Parcel Serv., 615 F.2d at 107, and is ripe for

adjudication as a matter of law.  Therefore, we will proceed to

assess the merits of the Leagues' claim that Delaware's sports

betting scheme violates PASPA.4

IV.

 

15

We begin our legal analysis with the statutory language.

PASPA prohibits any person or governmental entity from

sponsoring, operating, advertising or promoting:

a  lottery, sweepstakes, or other betting, gambling,

or wagering scheme based, directly or indirectly

(through the use of geographical references or

otherwise), on one or more competitive games in

which amateur or professional athletes participate,

or are intended to participate, or on one or more

performances of such athletes in such games.

28 U.S.C. § 3702.  The statute contains four exceptions, only

one of which is relevant here.  That exception provides that

PASPA's general prohibition against sports betting shall not

apply to: "lottery, sweepstakes, or other betting, gambling, or

wagering scheme in operation in a State or other governmental

entity, to the extent that the scheme was conducted by that

State or other governmental entity at any time during the period

beginning January 1, 1976, and ending August 31, 1990."  28

U.S.C. § 3704(a) (emphasis added).

Not surprisingly, the parties view PASPA's language

differently, with both sides claiming that the plain language

requires a favorable result on the merits.

A.

Delaware contends that its sports betting scheme qualifies

for the exception in § 3704(a)(1), claiming: "[t]he plain

language of the pertinent PASPA exemption allows Delaware to

 

16

reintroduce a sports lottery under State control because

Delaware conducted such a scheme at some time between

January 1, 1976, and August 31, 1990."  Del. Br. at 3.  The State

also contends that the exemption "is broad in scope, and

nowhere states that it restricts Delaware to operating particular

lottery games for a particular sport."  Id. at 32.  In Delaware's

view, § 3704(a)(1) allows it to conduct any "sports lottery under

State control," id., because it did so in 1976.  Although the State

acknowledges, as it must, that the exception permits its lottery

only "to the extent that the scheme was conducted," it argues

that the word "scheme" refers neither to the three particular

games it offered in 1976, nor to parlay betting in general, nor

even to wagering on NFL games, but to a "sports lottery under

State control in which the winners of lottery games were

affiliated with the outcome of sporting events."  Id. at 33.

Even assuming that Delaware's interpretation of the word

"scheme" were persuasive, we must reconcile that interpretation

with the statutory language "to the extent that the scheme was

conducted by that State."  (emphasis added).  The State claims

that this phrase merely "identifies a condition (i.e., that a State

must have conducted a sports lottery in the past in order to be

permitted to operate a sports lottery in the future)," id. at 34,

rather than limiting the State's gaming authority to either the

particular sports or types of games previously offered.

Delaware argues that because state law previously authorized a

broad lottery encompassing many types of games and many

sports, it may now institute a broad lottery with those features.

In contrast to Delaware's argument, the Leagues contend

that the exception in § 3704(a)(1) applies only to lotteries or

 

17

other schemes "to the extent" that such lottery or scheme "was

conducted" by the State between January 1, 1976 and August

31, 1990.  The Leagues insist that it is not sufficient that a

particular lottery may have been contemplated, or even

authorized, but rather we must consider the specific means by

which the lottery was actually conducted.

We agree with the Leagues' interpretation.  As the

exception found at § 3704(a)(2) makes clear, there is a

distinction between wagering schemes that were merely

"authorized" and those that were "conducted."  See 28 U.S.C. §

3704(a)(2) (which applies to a wagering scheme that was both

(i) "authorized by a statute as in effect on October 2, 1991," and

(ii) "actually was conducted during the period beginning

September 1, 1989 and ending on October 2, 1991").  Whatever

the breadth of the lottery authorized by Delaware state law in

1976, PASPA requires us to determine "the extent" - or degree

- to which such lottery was conducted.  We cannot hold - as

the State impliedly suggests - that Congress meant to conflate

"authorized" and "conducted."  See BFP v. Resolution Trust

Corp., 511 U.S. 531, 537 (1994) ("It is generally presumed that

Congress acts intentionally and purposefully when it includes

particular language in one section of a statute but omits it in

another."); Alaka v. Attorney General, 456 F.3d 88, 97-98 (3d

Cir. 2006) ("It is a fundamental canon of statutory construction

that where sections of a statute do not include a specific term

used elsewhere in the statute, the drafters did not wish such a

requirement to apply.").  Thus, the sole exception upon which

Delaware relies - applicable to wagering schemes dating back

to 1976 - applies only to schemes that were "conducted."  28

U.S.C. § 3704(a)(1).

 

18

While minimizing the importance of the language of §

3704(a)(2), Delaware asks us to draw parallels to § 3704(a)(3),

which provides:

a betting, gambling, or wagering scheme, other

than a lottery described in paragraph (1),

conducted exclusively in casinos located in a

municipality, but only to the extent that- (A)

such scheme or a similar scheme was authorized,

not later than one year after the effective date of

this chapter, to be operated in that municipality;

and (B) any commercial casino gaming scheme

was in operation in such municipality throughout

the 10-year period ending on such effective date

pursuant to a comprehensive State regulation

authorized by that State's constitution and

applicable solely to such municipality[.]

(emphasis added).  Delaware argues that the phrase "to the

extent" must mean the same thing in § 3704(a)(1) as it does in

§ 3704(a)(3), where the phrase identifies a condition.  We reject

this argument out of hand because the exception contained in §

3704(a)(3) - which deals with casinos - differs in subject

matter, structure, and syntax from the language of § 3704(a)(1).

As a fallback position, Delaware argues that PASPA is

ambiguous such that resort to legislative history is necessary.

We disagree, because as we have noted:

A statutory provision is not ambiguous simply

because by itself, [it is] susceptible to differing

 

5

 Delaware spends several pages of its brief explaining

the legislative history and citing statements from various

legislators.  These statements are inconclusive at best.  When we

view them in their entirety rather than focusing on "cherry-

picked" snippets, they offer no consistent insight into

Congressional intent.  For example, the Senate Report upon

which Delaware relies, Del. Br. at 13, states that the exemption

in § 3704(1) "is not intended to prevent . . . Delaware from

expanding their sports betting schemes into other sports as long

as it was authorized by State law. . . .  At the same time,

paragraph (1) does not intend to allow the expansion of sports

lotteries into head-to-head betting . . . ."  A152 (Senate Report).

This excerpt from the Senate Report is unhelpful in two

respects.  First, it is at odds with PASPA's statutory language.

19

constructions because in addition to the statutory

language . . . itself, we take account of the

specific context in which that language is used,

and the broader context of the statute as a whole.

We assume, for example, that every word in a

statute has meaning and avoid interpreting one

part of a statute in a manner that renders another

part superfluous.

Disabled in Action v. SEPTA, 539 F.3d 199, 210 (3d Cir. 2008)

(internal quotations and citations omitted).  Applying these

principles of statutory construction, we find unambiguous the

phrase "to the extent that the scheme was conducted by that

State," so our "inquiry comes to an end."  Kaufman v. Allstate

N.J. Ins. Co., 561 F.3d 144, 155 (3d Cir. 2009) (citation

omitted).5

 

Second, it contradicts Delaware's claim that single-game

wagering is permitted.  Similarly unhelpful are the many

statements of individual legislators cited by Delaware because

such "cherry-picked" statements cannot be deemed to reflect the

views of other legislators, much less of a majority of those who

enacted the statute.  Szehinskyi v. Attorney General, 432 F.3d

253, 256, (3d Cir. 2005) ("[Appellant's] selective invocation of

fragments of the floor debate is an object lesson in the perils of

appealing to this particular kind of legislative history as a guide

to statutory meaning.  This case is a perfect illustration of the

well-known admonition that what individual legislators say a

statute will do, and what the language of the statute provides,

may be far apart indeed.  The law is what Congress enacts, not

what its members say on the floor.").  In sum, we conclude that

"[t]he legislative history is more conflicting than the text is

ambiguous," Wong Yang Sung v. McGrath, 339 U.S. 33, 49

(1950), and does not support the State's position.

20

Because we do not find PASPA ambiguous, we find

unpersuasive Delaware's argument that its sovereign status

requires that it be permitted to implement its proposed betting

scheme.  See Gregory v. Ashcroft, 501 U.S. 452, 460-61 (1991)

("[A]bsent an unmistakably clear expression to alter the usual

constitutional balance between the States and the Federal

Government, [federal courts] will interpret a statute to preserve

rather than destroy the States' substantial sovereign powers.")

(internal quotations omitted).  PASPA unmistakably prohibits

state-sponsored gambling, 28 U.S.C. § 3702, subject to certain

exceptions, 28 U.S.C. § 3704.  Through PASPA, Congress has

"altered the usual constitutional balance" with respect to sports

wagering, although Delaware retains the right to implement a

 

21

sports wagering scheme "to the extent that the scheme was

conducted" previously.  Those words of limitation are not

rendered nugatory by generalized notions of "state sovereignty."

Finally, Delaware argues that we cannot construe the

language "to the extent that the scheme was conducted" so

narrowly because doing so would render the PASPA exception

a nullity.  Certain aspects of Scoreboard were deemed

impermissible by either Judge Stapleton, NFL, 435 F. Supp. at

1387-88 (holding that Touchdown II violated the lottery

provision of the Delaware Constitution by utilizing a fixed-

payoff scheme), or the Delaware Supreme Court, Op. of the

Justices, 385 A.2d 695, 705 (Del. 1978) (striking down Football

Bonus and Touchdown because they awarded prizes on a pari-

mutuel basis in violation of the State's Constitution).

Consequently, the State reasons that if it is confined to the exact

scheme conducted in 1976, the exception would be illusory as

applied to Delaware.  The State argues that Congress could not

have intended this result, especially when the legislative history

makes clear that Delaware was one of only four states that were

intended beneficiaries of the exception.  See Conn. Nat'l Bank

v. Germain, 503 U.S. 249, 253 (1992) (courts should disfavor

interpretations of statutes that render language superfluous).

Delaware's reading overstates the narrowness of the

exception provided by § 3704(a)(1).  We do not hold that

PASPA requires Delaware's sports lottery to be identical in

every respect to what the State conducted in 1976.  Certain

aspects of the lottery may differ from the lottery as conducted in

1976, as long as they do not effectuate a substantive change

from the scheme that was conducted during the exception

 

22

period.  For example, as the State aptly noted - and the

Leagues conceded - at oral argument, "to the extent the

scheme was conducted" cannot mean that Delaware could

institute a sports betting scheme for only four months as was

done in 1976.  Likewise, Delaware is neither limited to selling

tickets at identical venues nor prohibited from allowing

wagering on NFL teams that did not exist in 1976.  Such de

minimis alterations neither violate PASPA's language nor do

violence to its central purposes, viz., to limit the spread of state-

sponsored sports gambling and maintain the integrity of sports.

By contrast, expanding the very manner in which Delaware

conducts gambling activities to new sports or to new forms of

gambling - namely single-game betting - beyond "the extent"

of what Delaware "conducted" in 1976 would engender the very

ills that PASPA sought to combat.  In construing statutes, we

consider the statute's overall object and policy, and avoid

constructions that produce "odd" or "absurd" results or that are

"inconsistent with common sense."  Disabled in Action, 539

F.3d at 210 (internal citations omitted).

B.

In light of our reading of PASPA, we determine what

scheme Delaware may conduct in 2009 with reference to the

scheme it conducted in 1976.  As Judge Stapleton held in NFL

- and as was not disputed in the proceedings before either the

District Court or our Court in this matter - the only sports

betting scheme "conducted" by Delaware in 1976 involved the

three Scoreboard games.  That betting scheme was limited to

multi-game parlays involving only NFL teams.  Thus, any effort

 

23

by Delaware to allow wagering on athletic contests involving

sports beyond the NFL would violate PASPA.  It is also

undisputed that no single-game betting was "conducted"  by

Delaware in 1976, or at any other time during the time period

that triggers the PASPA exception.  See NFL, 435 F. Supp. at

1385 ("None of the [1976] games permits head-to-head or single

game betting.").  Because single-game betting was not

"conducted" by Delaware between 1976 and 1990, such betting

is beyond the scope of the exception in § 3704(a)(1) of PASPA

and thus prohibited under the statute's plain language.

Under federal law, Delaware may, however, institute

multi-game (parlay) betting on at least three NFL games,

because such betting is consistent with the scheme to the extent

it was conducted in 1976.  Of course, we express no opinion

regarding the legality of such a scheme under Delaware

statutory or constitutional law.

For the foregoing reasons, we will vacate the order of the

District Court and remand for proceedings consistent with this

opinion.

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