When the Supreme Court decided not to hear the West Flagler Associates case against Florida, thus preserving the Seminole Tribe’s monopoly on sports betting in Florida, we knew there would be ramifications. We thought maybe other tribes, like in California, would do the same to get legal betting going.
That hasn’t happened yet, but one domino did fall in Colorado’s betting scene. Here’s what happened and why the impact of the Seminole’s case could just be barely starting:
Colorado Tribe Suing The State Over Betting
Colorado has many Native American tribes. One of them is called the Southern Ute Indian Tribe. Don’t confuse them for Utah give the Ute name. No, they are based out of the Rocky Mountain state.
Welp, the Utes are suing the state, specifically Gov. Jared Polis and Colorado Division of Gaming director Christopher Schroder. They are claiming the state is trying to screw them out of the mobile sports betting market. Attorneys for the tribe specifically pointed out the recent Supreme Court decision in their case.
Well talk about what they’re arguing soon, but let’s quickly recap what happened in Florida. This will level-set the topic, plus other potential fallout on the entire country.
In 2021, the state of Florida and the Seminole Tribe agreed to a 30-year compact, granting the tribe the sole license for sports betting. This license would apply to Hard Rock casinos, but also statewide via online apps. You see, the tribe used servers on tribal land to reach the entire state with an online sportsbook app. This is being called a “hub-and-spoke” model.
A model like this is the envy of every tribe operating a casino, far beyond Florida. You see, in almost all states where tribes have sports betting rights, they’re reserved strictly for in-person. All bets have to be done at their physical casinos or maybe, nearby tribal land. They can’t just offer sports betting across the state online.
Florida’s hub-and-spoke model essentially extends the reach of the Hard Rock Bet app. It works up and down the Sunshine State — not just in and around the Hard Rock casinos. This is rule is what the Utes are making a stink about in Colorado.
Here are the exact words from Southern Ute tribal chairman Melvin Baker when the lawsuit was announced. He said, “The Seminole tribe was entitled to engage in statewide sports betting in Florida… any legal objection to the Southern Ute and Ute Mountain from engaging in statewide sports betting is gone.”
Utes-Colorado Have Rocky Relationship
The Ute tribe is currently offering gaming under a 1995 compact made with the state. It operates a brick-and-mortar casino on its reservation toward the southern part of the state. As part of this lawsuit, the tribe is saying Colorado is breaching that original 1995 compact.
The Utes say there’s language in the compact that allows the tribe to have “those gaming activities and bet amounts that are identical” to ones authorized in the state. Therefore, if mobile betting apps in the state — the BetMGM, DraftKings, FanDuel, etc. — can offer statewide mobile betting, which they do, then the tribe can do the same. That’s the argument being made here.
“Through actions by the state, we have been prohibited from successfully engaging in this new economic opportunity,” Baker said. “Because of these actions, non-tribal gaming enterprises have had a significant advantage.”
As always, money is at the center of this conflict. Of course, the tribe wants their app to work statewide and reap the revenues that come with more reach. However, they are arguing that Colorado is motivated by money in all this too.
You see, the Utes had a sportsbook app, in partnership with US Bookmaking. However, it was not subject to the 10 percent tax the state levies on commercial operators. This is because the betting server was in tribal land. So according to the tribe, the state wants to maximize their tax revenues from operators (via taxes) and freeze them out.
We can look at the situation from afar and think it’s absolutely frivolous. We mean, the Utes app isn’t going to contend with established Colorado betting apps like FanDuel so the state isn’t missing out on much by giving them a 0 percent tax rate. However, an agreement is an agreement, and whatever the compact says will determine who wins or loses.
We’re monitoring this story closely, less so because we care about what happens in Colorado, but more about the national precedent. The Supreme Court made a precedent by not hearing out West Flagler Associates’ gripe against the state of Florida. Logically, this can be applied across the country — not just in Florida.
The Utes and Baler are just the first to try it out. If they are successful in their lawsuit, there’s no reason every single tribe operating a sportsbook in the United States can’t do the same. This is a big story that we’ll be writing about so make sure to check back for updates.
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