Episode 3: Welcome to the Garden State - podcast episode cover

Episode 3: Welcome to the Garden State

Oct 08, 202445 minSeason 5Ep. 3
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Episode description

How did we get from fantasy sports to legalized sports betting? The path is convoluted, but most of it winds through New Jersey. Michael Lewis speaks with former governor Chris Christie, among other Jersey politicians, as well as lobbyists for the gaming industry. Plus we hear from Ted Olson, the lawyer who kept bringing the Garden State’s constitutional challenge until it finally reached the Supreme Court — and hit a jackpot.

For further reading:

Albert Chen’s Billion Dollar Fantasy

Murphy v. NCAA

ESPN timeline of how sports betting was legalized

SCOTUS Blog: The Tenth Amendment, Anti-Commandeering and Sports Betting

See omnystudio.com/listener for privacy information.

Transcript

Speaker 1

Pushkin.

Speaker 2

It's always sort of dumb to pick a single moment when everything changed, But there actually was a moment when the American sports fan changed. It came in nineteen seventy nine, before the start of the baseball season, a writer named Dan Oakrin taught a bunch of friends a weird new game he'd invented. Dan's game worked like this. The players each picked their own baseball team from the entire pool

of real life current baseball players. Your imaginary team gets credit for whatever those baseball players do in future real life baseball games. You win by being the best at predicting what individual baseball players will do. This kind of game eventually got called fantasy baseball. Fantasy play spread to other sports. People sometimes bet money on their fantasy teams. They might pay a fee, are a fantasy tournament, and the winner gets to keep the pot. But the money

isn't really the point. The point is to spend all baseball season with your friends and your fantasy teams. But then in two thousand and nine, this company in Scotland gets created by some techies who aren't even interested in sports fan duel. It's called These techies think they might find a way to make money off fantasy sports by speeding it up by making it a daily competition. Instead of waiting all season to see who won your league, you pick your teams for a single day of games.

Instead of one contest per baseball season, you have one hundred and sixty two.

Speaker 3

What they found very early on as they tested their products, they showed kind of an early version of daily fantasy sports to users.

Speaker 2

This is Albert Chen, sports writer, author of a book about all this called Billion Dollar Fantasy, And.

Speaker 3

They showed it to a guy and sort of like this focus career have been. He's like, yeah, this looks like, you know, sure, a daily version of fantasy sports that my thirteen year old would play. And then they were like, well, what if you can actually win some money off of this? And he was suddenly very interested in that. It's the money aspect.

Speaker 2

By twenty twelve, millions of Americans are playing fantasy sports. Some guys in Boston create a second company called DraftKings to compete with fan duel. Venture capitalists throw money at them. Before the twenty fifteen NFL season, these two companies are outspending the entire beer industry on TV ads.

Speaker 3

I'm seeing these commercials that are appearing, and I would later learn at a rate of every ninety seconds. And it was just an avalanche of ads that were frankly terrible. You know, ads that look like they were three AM infomercial hair Club for men.

Speaker 1

Ads. There were testimonials.

Speaker 4

Best of all, you could win a shipload of money. Use promo code kick to play and get free entry into the Millionaire Grand Final, be crowned to Fantasy Football Millionaire, Get to DraftKings dot com.

Speaker 2

What these companies do is different from old fashioned fantasy sports. Their games are fast, they're played not by friends in person, but by strangers online, and they involved serious money.

Speaker 3

These ads were about people who were making ten thousand dollars, fifteen thousand dollars, a million dollars and just like a lottery ticket, winning just an insane amount of money. So that caught my eye.

Speaker 2

That caught a lot of eyes, and not always the eyes the companies wanted to catch.

Speaker 3

They caught the eye of the law. People were one, how is this? First of all, how is this on my TV screens? Because sports gambling is illegal and this sure smells like sports gambling, right.

Speaker 2

I'm Michael Lewis and this is against the rules. This season, we're exploring the role of fans in American life. We've come to the point where the sports fan is about to take the field against American law. You can probably guess who's going to win, but no one has ever really told the story of how the game was played.

Speaker 5

A number of lawmakers start wondering, well, this feels like gambling.

Speaker 2

That's Jeremy Coudon, partner in a New York firm called URIC that lobbies state legislature, is on behalf of various clients, including back in twenty fifteen, fantasy sports companies.

Speaker 5

You're basically putting money down on something that involves an athlete, and you're getting paid back something if you win. That to us sounds like sports betting. So a number of state attorneys general issued opinions that these contests had to cease and desist.

Speaker 2

In twenty fifteen, Jeremy gets hired by DraftKings and Fan Duel. Nearly every state has a law that forbids running a sports book, and even if they wanted to legalize it, they couldn't thanks to a federal law created by New Jersey Senator Bill Bradley Jeremy Kudon's job is to try to prevent states from extending those anti gambling laws to fantasy sports, and ideally to get states to pass bills that explicitly legalize fantasy play. But Jeremy needs an argument for why legislators should do this.

Speaker 5

So in most states, if you can show that there is more skill than there is luck, then you will be able to say this isn't a form of gambling, and therefore he is legal like most states allow you to have. Like golf tournaments are legal, fishing tournaments are legal.

Speaker 2

That's his argument. Fantasy sports are games of skill, more like phishing tournaments than playing the slots. To prove his point, he hires an economist. The economists runs some numbers to show that the best fantasy football players are better at building teams than any actual NFL general manager. Jeremy's argument raises at least one question, why does states think that gambling is all luck? But let's leave that to one side. Because Jeremy didn't have a lot of time for philosophy.

He was in a hurry to flip the switch in as many states as possible. How'd you pick which states to start with?

Speaker 5

We were focusing on smaller legislatures at the time, where this would be something that would interest them and that we would have time to actually pass.

Speaker 2

It smaller legislatures. That was one trait that made a state open to his, say els pitch, But there were other less obvious ones.

Speaker 5

You know, I wanted to have male dominated legislatures at the time because I, you know, I felt like it would be easier to explain the issue.

Speaker 2

You actually thought of that, that it was going to be easier to sell us to guys than to women. I did, yes, Why and why did you think that?

Speaker 5

Because, well, some of the women and look, there's a lot of women who were great with dannis sports I want.

Speaker 1

To make clearer.

Speaker 5

Oh yeah, no, A lot of them were like, I have no idea what you're talking about. That just sounds like gambling. And with a lot of the men are like, oh no, I do fantasy sports. You're telling me this is gambling. There's no way this is gambling. It is for my friends.

Speaker 2

Kansas is the first to explicitly legalize daily pay to play fantasy sports. Not obvious, right, I mean, in fact, pretty random. If you had to guess which state would be the first to let its citizens off any leash. Kansas isn't who you'd pick. Once he has Kansas in the bag, Jeremy persuades twenty two more states to pass laws allowing fantasies sports. After he's finished, the color coded map of where fantasy is legal will look nothing like the usual red and blue political maps we spend our

lives staring at. For example, both Arkansas and New York will allow fantasy sports, but both Hawaii and Idaho will forbid it. And when Jeremy's done, twenty three otherwise unrelated states will share one very important thing in common. They will all have legalized fantasy sports, which suggests they might be gained to legalize some other stuff. How do you get interested in sports betting in the first place?

Speaker 6

I mean, in the first place a Catholic grade school.

Speaker 2

Joe Brennan Jr. Like lots of people in this episode, he grew up within one hundred miles of Trenton, New Jersey, and went to a grade school with an illegal sport. It's gambling ring inside of it.

Speaker 7

The first time I actually saw one of the typical the classic NFL parlay tickets that you see get handed out that White Parley tickets in the second grade, and then the first one I played one was in the fifth grade.

Speaker 2

Joe grows up in the early two thousands, goes to work for an Internet company. The internet's new back then, and people are wondering what other people might want to do on it. Joe thinks one thing they might want to do gamble on sports, a service illegal to provide almost anywhere outside of Nevada.

Speaker 6

Sports betting was always referred to, at least in gaming and gaming politics, as the third rail of gaming politics.

Speaker 1

That it was just it was for Boden.

Speaker 6

Don't even get into a discussion of it.

Speaker 2

That's partly because of Senator Bill Bradley's law. Well, by now most people have forgotten that it's Bill Bradley's law. They just call it by its acronym PASPA. Past has been the law of the land for a long time. Everyone seems to be for it and no one seems to be against it. The NFL, the NCAA, the NBA, Major League Baseball, every major sports institution in America says sports gambling is evil. Joe doesn't care. He sees a

business opportunity. He raises some money, creates a firm to lobby for change, and the change starts the way it always starts in Washington with panel discussions.

Speaker 6

I was invited to speak at the annual Sports Law Conference because it was here in Washington, DC, and was on a panel about legal sports betting.

Speaker 2

This is in twenty twelve. The room's mostly filled with like minded people. People who want sports betting legalized, many of whom have grown up within one hundred miles of Trenton, New Jersey. People who think, why can't these idiots who hate sports gambling see that their law is dumb since every school kids already doing it. A regulator from the state of Missouri was speaking.

Speaker 6

There was a gentleman sitting in the audience, and boy, this guy was casually dressed. He was just in like rugby shorts and a really you know, well worn polo shirt and you know, in between guffaws and saying things under his breath, the Missouri regulator asked him, is there something that you would like to say?

Speaker 1

Sir?

Speaker 6

Do you have a question for us? And they handed him the mic and he stood up and he said, I probably have more to do with that law PASPA being enacted than anybody else. My name is Jay Moyer, and I am the general counsel and executive vice president of the NFL. And there was a combination of dead silence and then the panelgon like whoa I said something probably not so nice.

Speaker 1

Like oh, so you're the guy to blame.

Speaker 6

So so mister Moyer did stand there and he expressed very very strong opinion as to why that law was enacted and why I should stand. And there was about the sanctity of the contests and that they should never be called into question, and that with gambling, it would be inevitable that it would just descend into madness, that people would never trust sports ever. Again, he wasn't mister

popularity in that room. Some of the audience started to say things, some of the folks on the panels started to say things, and to the point where mister Moyer definitely got flustered, and he finally he pointed his finger at us, and very red face he said, and I'll never forget this. I guarantee you this. You will never overturn that law.

Speaker 2

You heard Joe laughing there. He was already working to overturn that law by getting.

Speaker 6

A state to fe You start looking at Okay, well, what's a good state to start with. Who's going to be our test case? And Jersey was obvious Why So it was a combination of things. Was New Jersey was already very motivated to find something for Atlantic City to reverse its decline.

Speaker 2

People weren't packing the Atlantic City casinos the way they used to. Sports gambling was like the thing every Jersey boy did with his lunch money. And maybe most importantly, because after all this was New Jersey, there was a guy you could see.

Speaker 6

There was this one loan state legislator in New Jersey, Senator ray Lesniak.

Speaker 8

First of all, I was chairman of the Senate Economic Development Committee.

Speaker 2

Ray Lesniak now retired, but once a New Jersey State senator, I could get anything through the legislature. I passed the first law in the nation polishing the death penalty.

Speaker 8

That was not easy. I got a whole bunch of things. Yeah, I was pretty I was the main man in those days.

Speaker 2

As main man, ray thought he had a firm grip on New Jersey. He thought he could fix anything about it that bothered him. But then a friend of mine, Rudy Garcia, was arrested for placing a sports bet with a local bookie that happened back in March of two thousand and seven as part of an FBI sting. Rudy Garcia wasn't just Ray's friend. He was the former mayor of Union City, New Jersey, a lobbyist and an important ally in Jersey politics until he got whacked. That's amazing

to me that anyone bothered arresting him. Who's arresting a guy who's placing best sports bets with his friends in a bar.

Speaker 8

Well, there was a set up, obviously, it was a sting in operation, and they thought he was a runner.

Speaker 2

By the way, I know all about this.

Speaker 8

I used to place bets for my dad at the local grocery store when I was growing up.

Speaker 2

Of course he did, and the idea that Rudy Garcia got arrested for placing bets offended raised sense of right and wrong.

Speaker 8

He was arrested for doing something he could have gotten on a plane and flew to Las Vegas to do.

Speaker 2

And so Ray tries to do what he can usually easily do, change New Jersey state law, in this case, to legalize sports betting, even though it puts him in an odd emotional position because he himself has a complicated history with gambling off track.

Speaker 8

Betting was allowed in New York but not New Jersey.

Speaker 2

And I live in.

Speaker 8

Elizabeth and Gotha's Bridge is right in my neighborhood.

Speaker 2

Twenty minute rides or less.

Speaker 8

I was driving somewhere and then all of a sudden, I found myself on the Gothel's Bridge going to the betting polo.

Speaker 2

I just was like attracted there. I didn't even think about it.

Speaker 8

I said, Holy, here's my lane, which I was about to say, Well, that was a wake up call.

Speaker 2

I was full fledged atic for sure. Ray knew the dangers, but he didn't like anti sports betting laws or the fact that they were being used against his friend Rudy Garcia. Even though Rudy was never actually charged, the damage was done by this stupid law. So Ray decides to fight Bradley's law. But this he cannot do without the Governor of New Jersey's help, and the Governor of New Jersey at the time is Chris Christy.

Speaker 8

Strangely enough, Christy and I do not get along at all, but he is.

Speaker 2

A very polite person.

Speaker 8

One of the things reasons why we didn't get along is that eight times he tried to block my effort to legalize sports.

Speaker 2

Betting without the governor on board. Raised powerless. But then he hears from Joe Brennan, Washington lobbyist for Internet sports gambling. Joe has a pile of money enough to get a proposition on the state ballot in twenty eleven to ask the people of New Jersey directly if they want to legalize sports betting. And you can guess what they decided.

Speaker 7

Folks in the state of New Jersey voted yesterday to legalize sports betting.

Speaker 2

The referendums just for show. It has no legal effect, but still two thirds of the voters in New Jersey vote to legalize sports betting. And how could they not? Three quarters of their children are already doing it. Ray thinks he's just forced Chris Christie's hand, and he's right.

Speaker 9

That's why I'm pleased to announce today that our administration is formally submitting our sports gambling regulations this week. When you looked at the black market in sports betting, you're talking about billions of dollars that's bet you know, was used to be bet on the black market in sports betting every year.

Speaker 2

That's Chris Christi explaining his change of heart.

Speaker 9

I thought, you know, legitimizing that already ongoing activity would not only create you know, great economic benefit for the state.

Speaker 2

Did you how did you have any sense of the size of the black market. Had you bet yourself?

Speaker 9

No, I was not someone who had bet myself, not since high school.

Speaker 2

Not since high school in New Jersey. This doesn't even count.

Speaker 9

There were always, you know, little minor bookies that were available in your school that would pass out these these like cards with the spreads for the football games on Sunday, and yeah, you'd bet five bucks and give them a card. And it was, you know, a fellow classmate as a runner for a bookie somewhere.

Speaker 2

Where did you go to high school?

Speaker 1

I went to Livingston High School in Livingston, New Jersey.

Speaker 2

I grew up in New Orleans. And nobody's running running bookies slips into the high school. Like, was this a common thing in New Jersey?

Speaker 1

Yeah? Absolutely.

Speaker 9

Welcome to the garden state, baby.

Speaker 2

Chris Christy and ray Lesniak may not get along, but they share a public garden. If they can mow down the rose bushes and develop it, they could both get rich. But the Lamb's controlled by Bill Bradley, New Jersey's former senator.

Speaker 9

That's what Bradley really thought, that gambling on any kind of large scale would kill the integrity of sports. He also used to tell me that he didn't want to be bet on like he was a horse. He was a human being, and he didn't want to be bet on, and he didn't want his performance bet on. So you know, I reminded the Senator any number of times that it already was being bet on, just not legally.

Speaker 2

Did you get where Bradley was coming from? Did anything he say make any sense to you?

Speaker 9

It made some sense to me, but I thought it was extraordinarily naive. And look, that wouldn't be the first time that Senator Bragley was accused of being naive. In fact, I think it's one of his greater character traits because it led him to think in a much different way than a lot of people. A lot of other people do, especially in New Jersey.

Speaker 2

Let's recap here a bit. In nineteen ninety two, New Jersey Senator Bill Bradley gets Congress to pass a law banning most states from legalizing sports gambling, but illegal gambling carries on in his home state, And meanwhile, fantasy sports starts taking off and states around the country are persuaded to legalize that. In twenty eleven, the voters of New Jersey let it be known loudly they'd like sports betting

to be legal. Now, Chris Christy, the governor who previously opposed sports betting, is not only saying he'll let it happen, he's preparing to pick a fight with Bill Bradley's law. Explain what's its stack here, and that how the federal government wasn't banning sports betting, it was preventing states from legalizing it, which is different.

Speaker 1

Right, And.

Speaker 9

Essentially, what we said was if the federal government tells you that you cannot do something, then they have to provide the regulatory muscle to prevent it from happening. And they weren't doing that. They basically just told us you can't do it. And by the way, if anybody's doing it in your state, you're responsible for preventing it.

Speaker 2

Chris Christy and Ray Lesniak both fought in their separate ways that Bill Bradley's law was unconstitutional. I mean, after all, Congress could have simply banned sports gambling, but it hadn't, mainly because it carved out an exception for Nevada. So the law was weird. And Ray gets the vote to pass the law legalizing sports betting in New Jersey, and Chris does indeed sign it. Then the two gentlemen in New Jersey sit back to see what will happen next.

So how often do you have clients come to you and say, I'm going to break the law, so I need you to make the law go away.

Speaker 10

Well, I don't recall too many occasions when someone's come to me and said I'm going to break the law.

Speaker 2

Meet Ted Olsen, maybe the greatest living constitutional lawyer, who, in twenty twelve, to Chris Christie's delight and surprise, has not already been locked up by the NFL, or the NBA or the NCAA.

Speaker 10

What happened here was that we wanted to test the constitutionality. Nobody broke the law. The legislature passed a statute changing New Jersey's constitution and statutes, and at that point our opponents came in and asked the court to stop that process as from taking place.

Speaker 2

Okay, so the politicians in New Jersey didn't exactly break the law. They passed a law that broke the law, knowing that they'd be sued by everyone who liked that law, and knowing that ted Olsen was just the guy to fight back.

Speaker 10

It's very rare that you have an opportunity to challenge the constitutionality of an Act of Congress and seek a court to overturn an Act of Congress on constitutional grounds. This was one where there was not much precedent.

Speaker 2

By the time you come to challenge this law, it's twenty years old. How unusual is it for a law to sit there for that long before it's challenged.

Speaker 10

Well, it's very unusual. In the first place. The desire to pass this statute was perceived as doing good to stop people from betting on sports, stop the potential corruption of athletes and the temptations that might be put before him through money. Nobody challenged it. Why is the Supreme Court going to get involved in that now?

Speaker 2

But the Supreme Court's been drifting in a new direction for a while, and ted Olsen has helped it to drift. His fingerprints are all over the black robes. Back in the early nineteen eighties, along with a bunch of law students, Ted helped to foster something called the Federalist Society, and the Federal Society then evolves into sort of a farm team for the Supreme Court. Justices Samuel Alito, Brett Kavanaugh,

Neil Gorsich, and Amy Cony Barrett are all members. So ted Elson not only knows them, they're all in the same club. That's one reason you hire ted Olsen to argue your case. His presence alone signals to the Supreme Court that this case might be worth having a look at. It's like having Brad Pitt attached to your movie. This case interests you. How do you decide how to argue it? Like you can just kind of take me inside your process.

Speaker 10

The federal government in this case had the power to regulate gambling. It could regulate gambling under the Interstate Commerce Clause if it was commerce, and it certainly was, but the Congress did not choose to do it that way. It said states may not authorize or permit gambling on sports. So, in other words, what Congress was doing was, we want to prohibit this activity, but we want the states to

do it. States will take the responsibility and the blame and the credit or the blame for doing it because the federal government stepped aside just demanding that the states do it, and the states will spend their money to pass a statute and enforce a statute. There is the federal government going to do something, it should take responsibility for it. It should pay for the enforcement.

Speaker 2

Ted Olson has lit upon what in constitutional law is known as the anti I'm endearing doctrine. The doctrine is actually not in the Constitution. It's an interpretation of the Tenth Amendment, and the tenth Amendment says the power is not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved by the states,

respectively or to the people. In other words, according to this interpretation, Congress shouldn't try to get its way by compelling states to do something or not to do it anyway. Chris Christy heard this argument and he really liked his odds well.

Speaker 1

Very early on, I had a lunch with Roger Goodell.

Speaker 2

Roger Goodell was and is the commissioner of the NFL, and I.

Speaker 9

Said to him, Roger, let's just you and I settle this. Let's come up with a set of circumstances where it's agreeable to the NFL, And so we sat there for lunch that day, and Roger's a very good guy. He just said to me, Chris, you got to just drop the case because we're going to embarrass you. You know, we're gonna beat you. We're gonna embarrass you, and you're spending public money to do this and it's not gonna work out.

Speaker 1

And I like you, and you shouldn't do it.

Speaker 2

For a very long time, the New Jersey case seemed hopeless. No judge in the lower courts was buying ken Olsen's argument, but at one point, a lawyer for the NFL says, we aren't saying you have to enforce a prohibition. We're not saying you need to do anything to prevent sports gambling. You just can't legalize it.

Speaker 9

So okay, So we went back and passed the legislation that essentially took the hands off position. I said, we're not to do anything, but we're sure as that hell not going to enforce stopping anybody from doing it. They aren't going to legalize sports gambling. They're just going to tell their citizens that no one minds if they bet on sports. It's a funny move. And they must have they never have expected you to do that, correct, And I think it's like taking the speed of lim it

signs down on the highway. Yeah, and then we tell people and we're not going to pull you over like have had it, you know. And so we do it, and the league sue us.

Speaker 2

And so New Jersey's lawyer Ted Olsen, who returns for yet another season. He gone oh in three his first season, which ended in twenty fifteen. In the second season, he goes oh to four. It's now late twenty and seventeen, and at this point, seven different courts have ruled against New Jersey.

Speaker 9

I've already spent at this point about six million dollars in legal fees. So Ted calls me and he says, look, I know I have now lost seven times on this argument, but.

Speaker 1

I think if we file for cert they're going to take it.

Speaker 2

File for cert means asking the Supreme Court to hear the case. If they don't hear it, no state's going to challenge pass by again. Anyone who wants sports gambling to be legal is going to have to ask Congress to pass a new law, and good luck with that. The Supreme Court gets roughly eight thousand requests a year to hear cases, and it accepts only eighty. But in twenty seventeen, the Supreme Court announced it wanted to hear New Jersey's case.

Speaker 11

I think the nineteen eighties and nineteen nineties the Supreme Court rediscovers what it calls federalism.

Speaker 2

Alison Lacroix she teaches at the University of Chicago Law School and has written a book called The Innerbellum Constitution. It's about the Supreme Court in the decades before the Civil War, a period that interested her because that Supreme Court rhymes with ours. The state's rights cases were everywhere. Slavery was the main issue, of course, but there are lots of others, just like now, abortioning guns are the main issues, but there are lots of other issues that

the society's failing to resolve on the national level. What's behind this rediscovering of states rights?

Speaker 11

One view says federalism isn't even a real thing. It's just about whoever's not in power in the center is going to become a defender of peripheral power. You know, if you don't control Washington, you're going to be the person saying that's okay because my state or my city can make its own policy, and there's no there there. It's just a kind of dynamic and decentralization versus centralization.

Speaker 2

There's another way to put this, that state's rights isn't some abstract principle. It's just camouflage for your desire for some concrete outcome. But Allison thinks it's deeper than that.

Speaker 11

I think what's behind the resurgence of states' rights is it's a forum or a kind of crucible to have deep existential arguments, especially when the political system, as in the partisan system, seems to not be functioning because federalism lets you kind of go outside parties or seem to and say, now I'm talking about this deep constitutional structure.

Speaker 2

In other words, we're seeing a rise in these sorts of cases because Congress has lost its ability to resolve disputes. Sports gambling is sort of an example of this because back when he introduced his bill in the early nineties, Bill Bradley was unable to get Nevada to go along all the way with him, so he was forced to propose this weird law. It's rather than banning the thing outright,

just tell states they can't legalize it. Any federal law that shackle states in this way was bound to catch the eye of a Supreme Court skeptical of federal authority.

Speaker 11

And so it feels like there's this through line theme connecting a lot of the cases. But it's also funny. I mean, this goes to the question as well, which is the Court is not hostile to federal power when, especially when the federal power at stake is the Court's own power. They have this way of talking about themselves or not talking about themselves, and implying that they're not one of the branches of the federal government, like they're just there again as the umpire oh.

Speaker 9

Yay, oh yay, oh yay.

Speaker 10

You're standing at a podium looking at the Supreme Court. They are arrayed all night of them in something close to an arc, so that the justices and they're arranged and by in order of seniority.

Speaker 2

By that day, December the fourth, twenty seventeen, ted Olsen had already argued sixty two cases before the court. This would be his sixty third appearance.

Speaker 10

The Chief Justice is probably six seven eight feet from the podium where you're standing. You stand still, you don't move about, and you stand up straight and address the court as much as you can.

Speaker 2

New Jersey Governor Chris Christy was in court that day watching. He had a front row seat. We'll hear an argument first this morning in case sixteen four to seventy six, Christy versus NCAA.

Speaker 10

Mister Olson, thank you, mister Chief Justice, and may have pleased the court.

Speaker 2

That's how ted Olsen began. But Supreme Court hearings are less like TV trials than job interviews. The lawyers each stand there in front of the justices for about thirty minutes, and the justice is just pepper them with questions. Christy watches the action closely. He sort of knows he's gonna win. I mean, why here the case if you aren't going to overturn the law. But there's still some drama. It's like when you know a guy in the Sopranos is about to get taken out, but you don't know how

or who's gonna do it. Christy's especially interested in Justice sam Alito.

Speaker 9

Sam is a former US attorney in New Jersey, so he's a predecessor of mine.

Speaker 2

Did he grow up in New Jersey too?

Speaker 1

Absolutely grew up in Trenton.

Speaker 2

You think he grew up betting sports.

Speaker 1

I don't know if he did, but I bet you his father did.

Speaker 9

Yeah, his father was a huge sports fan, and Sam is a huge sports fan. I can't imagine that Sam, that Sam Alino Senior did not, you know, put a couple of bucks down every once in a while on a Phillies or an Eagles game.

Speaker 2

He can't imagine that Sam Junior won't play the starring role in this Jersey show, which is maybe why in the story Christie is about to tell, he gives Justice Alito the big moment when the big moment wasn't his. But I gotta let Christy do it, even if it doesn't quite match the record.

Speaker 9

The best moment was Alito because Alito said to Clement, Okay, let me understand something.

Speaker 2

It was actually Chief Justice Roberts who says this, and it was another lawyer on the other side he said it too, but never mind.

Speaker 9

He said, so, let me make sure I understand what you're saying. You believe the public in New Jersey and any other state that followed them would be better off if the state put absolutely no restrictions on this at all. And he goes, absolutely right, Justice Alito and he goes, Okay, So you think New Jersey would be a better place.

Speaker 1

To live and raise your family If.

Speaker 9

A twelve year old could go into a gambling hall and bet his lunch money that is pas parents had given him on the Eagles game this weekend, you think that would be better. If he says, yes, it would be better, you look like you're ridiculous. If, on the other hand, you said, well no, well then you start to go down the slippery slope of allowing us to do some things but not other things, and then the Feds are making the qualitative judgment on something that they themselves are.

Speaker 1

Unwilling to enforce.

Speaker 9

He said yes, and Alito grabbed his like YETI and took a big swig of whatever was in.

Speaker 2

There, because in New Jersey you never know what's in the YETI, And.

Speaker 9

He said something to the effect of you really don't believe that, but you know. Then at that moment, I thought to myself, Okay, we're in really good shape here.

Speaker 2

Ted Olsen has this ritual after every Supreme Court case, he takes his team out for a meal. He goes around the take and ask each person to predict how the Supreme Court will rule. Often they're split unsure, but here no one had any doubt. Christy went back to New Jersey, knowing that he was playing a new hand.

Speaker 9

I got a call from Roger Goodell and he said, Hey, I'm flying out of Titterborough to go to some game. Do you have time for us to have a meeting. I'm like, sure, Roger, I'll come meet with you. So we met in a conference room at the airport in Teterborough and he said to me, look, why don't we talk about settling this? And I started to laugh and I said, Roger, I'm going to put this in language that you understand. I said, you're asking me to punt when it's first in goal.

Speaker 1

No thanks.

Speaker 2

Nearly six months later, on May fourteenth, twenty eighteen, the Court issued its ruling on Bill Bradley's law. All you really need to hear is this one line that Justice Samuel actually said.

Speaker 6

We therefore hold that the Passbook provision outlawing state authorization of sports gambling is unconstitutional.

Speaker 2

It had been a Jersey job from start to finish, and there was one funny little twist which ray Lesniat no doubt enjoyed Before the ruling. Chris Christie's term as governor had ended. Phil Murphy was the new governor of New Jersey, which is why the case is now and forever called Murphy versus the NCAA. In retrospect, it's sort of amazing how shocked everyone was. How out of the clear blue sky this lightning bolt came. Did you see forces, any forces kind of at work to undermine the legislation

before the Supreme Court decision? Nobody said anything to you, But did you were you know? Okay, I thought they didn't say anything to me. That's former New Jersey Senator Bill Bradley, who you might have thought would have seen the writing on the wall. But you didn't see the Supreme Court decision coming.

Speaker 1

Absolutely not. I was totally blindsided.

Speaker 2

And the people with the greatest financial interest in the case, the company's position to dominate the new sports gambling industry, they hadn't seen it coming either. I want you to describe in more detail the moment you learn that the Supreme Court's going to hear this case.

Speaker 5

I am physically in DraftKings' old offices at that time.

Speaker 2

Jeremy Kudon again, the lobbyist who's been getting fantasy sports legalized in twenty three states on behalf of Fan Duel and DraftKings.

Speaker 5

And I see all of a sudden, a bunch of texts from people you know in the industry saying, oh my god, the court granted sir, which again means agreed to hear the case. And I was like, what court and what case?

Speaker 2

FanDuel and DraftKings were like people who bought a home on top of an oil field without knowing it. The Beverly Hillbill is of gambling.

Speaker 5

We ran, I think, I mean literally ran to Jason Robbins, who's the CEO of DraftKings office, which I mean it wasn't a long run at the time, and you know, had to explain, hey, what we were even talking about, and then explain what this meant, and you know, his eyes looked like saucers, and you know it was one of these things like, wow, we never get this lucky, this is the greatest day. I mean, this changed everything.

Speaker 2

Jeremy had already sold twenty three states on fantasy sports by arguing that fantasy sports wasn't gambling. Now that sports gambling was on the verge of becoming legal, he need to go back with a new argument. Which would go something like this. Look, you've let us do fantasy sports, which we all know has a lot in common with gambling, so you're already halfway there. Jeremy sensed an opening. Every state that allowed fantasy sports might allow sports gambling fast,

because they could take a cut of it. No one remembers this, but back in twenty eighteen, both FanDuel and DraftKings were small companies running on fumes. It was unclear whether either would survive. Two years after the Supreme Court decision, each would be valued at least twenty billion dollars, and together they would basically shape the world in which the

American sports gambler would live. Jeremy had spent all this time arguing for the moral superiority of games of skill over games of chance, but the boom about to happen was all just sheer dumb luck. In part two of the season, we're going to explore the soul of the new machine, this vast new gambling industry that, through sports, is changing our culture.

Speaker 5

I don't know anybody who's ever been in gambling thought they were a better person for it.

Speaker 2

Do you have any interest in golf?

Speaker 11

No, I've never watched golf.

Speaker 2

Do you know how many holes there are?

Speaker 11

Nine?

Speaker 2

Actually eighteen?

Speaker 12

I thought I got that right, And I remember having like thirty thousand dollars on that front seat and being like, oh my god, so much money in cash in cash.

Speaker 2

That's all still to come. But first I want to let you listen in for longer on some of the conversations we've had for these episodes. We usually talk to people and they just use bits and pieces of what they tell us, but I'd like you to hear more of it about the sociology of fandom, about federalism, about politics. So over the next few weeks, we'll be bringing you

some of those interviews. Next week, my full conversation with Professor Allison Lcroy Against the Rules is written and hosted by Me, Michael Lewis and produced by Lydia gene Kott, Catherine Gerardeau, and Ariela Markowitz. Our editor is Julia Barton. Our engineer is Jake Gorski. Our music was composed by Matthias Bossi and John Evans of stell Wagon Sinfinet. Our

fact checker is Lauren Vespoli. The Supreme Court audio in this episode comes from Oya dot Org Special thanks to a few more folks who made this season of Against the Rules possible. Jacob Weisberg, Greta Cone, Sarah Nix, Christina Sullivan, Kerry Brody, Eric Sandler, Kira Posey, Jordan McMillan, Jake Flanagan, Owen Miller, Sarah Buguerier, Jacob Goldstein, and Sophie Krane. Against

the Rules is a production of Pushkin Industries. To find more Pushkin podcasts, listen on the iHeartRadio app, Apple Podcasts or wherever you listen to podcasts, And if you'd like to listen to ad free and learn about other exclusive offerings, don't forget to sign up for a Pushkin Plus subscription at pushkin dot fm, slash plus or on our Apple show page.

Speaker 10

I was at the Super somebody's home during the Super Bowl a year or so ago, and one of my neighbors was there and had this little computer in his hander is his cell phone, and he said, I just bet that sometime during this game, someone will attempt to hit a field goal and it will hit the goal posts. And I said, Jesus Christ, you know who would bet on something like that. And then about five minutes later it happened.

Speaker 2

When that person bet on a field goal, hitting the goal post. Did you turn to him and say, do you know why you can do this?

Speaker 10

Now he knew

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