The smart money is on federalism

OCTOBER 2017 TERM

Any day now, the U.S. Supreme Court will announce its long-awaited decision in Murphy v. National Collegiate Athletic Association -- New Jersey's constitutional challenge to the Professional and Amateur Sports Protection Act. To preserve federalism, the court should strike down this anomalous and unconstitutional law.

PASPA is a thoroughly unusual federal law. Congress enacted it in 1992 to protect sports from the corrupting effect of gambling. But, rather than enacting a federal ban on sports betting, PASPA forbids states from "authorizing" betting. According to the 3rd U.S. Circuit Court of Appeals, this prohibits states from amending their own state sports betting laws, no matter how outdated or unpopular. Even more strangely, PASPA discriminates among the states as it decrees what laws they shall have. Nevada is completely exempt and several other states have narrower exemptions.

PASPA is also an outlier among federal laws in the extent to which it is widely flouted and held in disrepute. Illegal sports betting is a $100 billion enterprise. Across the country, people gamble on every major sporting event. And they do so in the open. Two years ago, then-President Barack Obama, appearing on the "Late Show with Stephen Colbert" after the 2016 Super Bowl, joked about betting on the game and laughed it off when Colbert pointed out that this violates federal law.

If you are concerned about protecting the sanctity of sports, which would you prefer: a huge black market for sports betting operated, in significant part, by organized crime, or a legal, closely monitored, and effectively regulated market? After decades of experience with the former, New Jersey decided that its citizens and its sports are much better off under the latter. In 2011, the state's voters approved a referendum -- by a whopping 2-to-1 margin -- favoring the state's legalization effort.

As a matter of first principle, New Jersey should easily prevail. Under the Constitution's system of federalism, the federal government cannot dictate policy to the states any more than the states can dictate policy to Congress. The Supreme Court has twice struck down federal laws that "commandeered" states and their officials.

Based on the oral argument between legal luminaries Ted Olson and Paul Clement, the odds favor New Jersey. Justice Anthony Kennedy, often the swing-vote on the court, highlighted the federalism problem with PASPA early in the argument: "[T]he citizens of the State of New Jersey are bound to obey a law that the state doesn't want but that the federal government compels the state to have. That seems commandeering." Justice Stephen Breyer jumped in too: "[T]he subject matter of this law is the state. That's what this is about, telling states what to do, and therefore, it falls within commandeering."

Later, Justice Kennedy expressed concern that allowing the federal government to control the content of state law "blurs political accountability. The citizen doesn't know is this coming from the federal government, is this coming from the state government. That's precisely what federalism is designed to prevent." Voters reasonably expect that, if a policy is written into state law and enforced by state officials, state politicians should be held accountable. But not so under laws like PASPA.

This would not be a noteworthy case except that the federal law attempts to cloak a commandeering statute as a preemption statute. Under the supremacy clause, Congress can preempt state laws that conflict with federal law. In defending PASPA, the United States argues that it merely preempts state efforts to amend or repeal their own laws -- it did not require the states to adopt their bans on sports betting in the first place.

This argument is too clever by half. The Supreme Court has long upheld federal laws that preempt contrary state laws because "if a state does not wish" to participate "the full regulatory burden will be borne by the Federal Government." In other words, it is constitutional for Congress to tell states that they must regulate consistent with federal policy or cede the issue to the federal government. But Congress cannot, as it does in PASPA, force states to endorse a policy and bear the burden of enforcing it.

The Constitution preserves federalism to enable state experimentation and promote accountability. Federal laws that attempt to dictate to states what their own laws shall be undermine those values and are unconstitutional. That's true whether the issue is marijuana or gambling, gun control or immigration, or any other hot-button issue. Fortunately, it looks like the Supreme Court is once again prepared to strike a blow for federalism.

Jonathan authored an amicus brief in Murphy v. NCAA urging the Supreme Court to declare PASPA unconstitutional.