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New federal rules affirming the legality of Florida-style “hub-and-spoke” tribal gaming compacts have been published.  

The new regulations clarify that states can indeed make gaming compacts with tribes that allow the operation of off-reservation betting.

Often termed the “hub-and-spoke” model, this type of gaming compact allows tribes to offer state-wide mobile sports betting under the Indian Gaming Regulatory Act (IGRA).

Most notably, Florida has used this model to regulate sports betting through a compact with the Seminole Tribe.

This granted the tribe an effective state-wide online sports betting monopoly through its Hard Rock Bet brand.

The compact has proved intensely controversial, with two pari-mutual betting operators challenging its legitimacy in both state and federal court.

In-line with the June 2023 ruling in West Flagler v. Haaland, the DC Circuit case that confirmed the Florida compact from federal objections, the Department of Interior’s (DOI) new regulations plainly state it is permissible.

“A compact may include provisions addressing regulatory issues concerning state-wide mobile wagering provided that state law authorises the portion of the wager transaction occurring off of Indian lands,” state the new rules.

Non-tribal organisations expressed “deep concern” over the proposed language of the new rule, arguing the provision “illegally expands Indian gaming state-wide and off-reservation”.

While the DOI said it acknowledges the comments, it said the new rules simply codify what is already existing practice and covered under case law.

“These regulations are part of the Biden-Harris administration’s commitment to ensuring that tribes have the resources they need to exercise their tribal sovereignty and support their communities,” said DOI secretary Deb Haaland.

“By updating these regulations, we will provide certainty and clarity to tribes for an industry that remains one of the most significant sources of economic development in Indian Country.”

The evolving legality of the hub-and-spoke model

The federal government throwing its weight behind the tribes on this matter is another twist in evolving legality of tribal gaming.

While the government highlighted the DC Circuit decision in support of the new rules, legal action is ongoing in both the Supreme Court and Florida Supreme Court.

This month, West Flagler filed its formal writ of certiorari in the SCOTUS case, requesting the court overturn the lower courts ruling in the matter.

The operator is claiming the Seminole’s compact is illegal under IGRA, UIGEA and 5th amendment grounds. Therefore Haaland had no right to authorise the compact, argued West Flagler.

If the court opts to choose to rule on the case, it will ultimately be decided sometime in 2025.

Trump-appointed justice Brett Kavanaugh has demonstrated a historic interest in cases that relate to issues of tribal government, leading to some speculation to court will take up the case.

Nevertheless, the Supreme Court only takes up a small percentage of cases it is presented with.

A ruling in West Flagler’s favour in the case would again reorient the legal situation of state-wide gaming compacts through the US.

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