DraftKings to bring sports betting to New Jersey

DraftKings Inc. announced that it has submitted a formal application for a state license to offer Vegas online type sports betting in New Jersey. New Jersey has been accepting applications to offer sports betting since February, based on NJ state law. DraftKings Inc., however, waited until May when the Supreme Court ruled that a federal law that disallowed sports betting was illegal and that states could legalize the activity.

DraftKings applied for a Casino Service Industry Enterprise License and the application is now being processed. The New Jersey Division of Gaming Enforcement (DGE) will decide on licensure which is expected to come through quickly. The filing makes DraftKings one step closer to securing a role as a leader in America's sports betting market.

Tim Dent, Chief Compliance Officer and Chief Financial Officer at DraftKings said "The New Jersey DGE has been on the leading edge of creating a smart, consumer-focused sports betting framework in the Garden State. We are working with New Jersey officials toward a public rollout of a DraftKings sports betting product."

One of the conditions of obtaining a license is expected to be the requirement that the sports betting facilitator demonstrate that it has a casino licensing partner in New Jersey. DraftKings recently announced that its partner will be Resorts Casino Hotel. The two companies will work together to offer one of the first online sports betting products in the state. 


DraftKings, headquartered in Boston, MA, is an innovative media and sports-tech entertainment platform. The company's goal is to change the way that consumers engage with their favorite sports, players and teams. They seek to bring fans closer to the game through activities that involve the fans in the game's outcome, such as betting. DraftKings offers daily and weekly fantasy sports contests across ten professional sports in the U.S., Malta, Germany, Canada, United Kingdom, Ireland, Austria and Australia.

With its application for a sports betting license in New Jersey DraftKings is poised to become a major player in the sports betting market. The New Jersey market alone is valued at an estimated $150 billion.

The State seems pleased to have DraftKings involved in the local sports betting industry. The State is eager to take advantage of DraftKings' more than 10 million registered customers as well as its state-of-the art technology and its prominent sports entertainment brand.

DraftKings has no intention of stopping in New Jersey. Even before the Supreme Court decision DraftKings started to build a world-class internal sportsbook team that will be able to function in many different states and countries. Karl Gambin was brought on-board as Director of New Jersey Gaming Operations. Gambin will lead the firm’s compliance, customer and regulatory activities in New Jersey from the company office in Hoboken NJ. At the same time the company is planning to expand operations. They are currently recruiting for an additional dozen personnel to help them move in on the ground floor in this new industry. 


New Jersey started top open the market to sports betting licenses well before the Supreme Court reversed the PASPA Act and made sports betting legal in the United States. PASPA is the Professional and Amateur Sports Protection Act of 1992. It was passed by Congress with the goal of forbidding sports betting in order, proponents said, to protect the integrity of professional sports competitions and lessen the lure of athletes being bribed or blackmailed to throw games.

The bill excluded the licensed sports pools of Nevada as well as the sports lotteries that were conducted in Montana, Delaware and Oregon. Congress also provided a one-year window of opportunity for states, such as New Jersey, where licensed casino gaming was already in place, to legalize sports wagering.

New Jersey didn't take advantage of this exemption in 1992/1993 but by 2011 the state allowed voters to choose whether they would prefer to see a state constitutional amendment that would permit sports gambling. That ballot initiative passed and in 2012 the NJ State Legislature enacted the 2012 Act (Sports Wagering Act) that legalized sports wagering at New Jersey casinos and racetracks. The law was challenged almost immediately by the professional sports organizations (NFL, NCAA, NBA, National Hockey League and the Major League Basketball Association) and it slowly wound its way to the Supreme Court.

One of the major arguments against the bill involved the unconstitutionality of allowing 4 states to offer sports betting while the other forty-six states were disallowed from the activity. The Court accepted the argument and declared that PASPA conflicted with the 10th Amendment and, as such, could not remain in force.

Moving Forward

Now that PASPA is no longer enforceable, observers are waiting to see how sports betting will play out in the future. The Supreme Court ruling didn't automatically legalize sports betting – it simply made it possible for individual states to pass their own laws regarding sports betting in their locales.

Not every state is rushing to legalize sports wagering in their state but of those that are, chances are that they will act before the upcoming NFL season starts – football betting has always been popular and now it can be done legally in more locales than ever. Delaware is preparing the infrastructure for sports wagering in the state and other states such as West Virginia, Mississippi, Pennsylvania and New York have begun the process of legalizing sports betting.


DraftKings is interested in pursuing online sports betting which is already popular in many countries. In New Jersey, sports betting will start with brick-and-mortar ticket-taking but most observers see online wagering coming soon. They say that as sports betting becomes more prominent and more investments come into the industry online betting apps will be readily available. 

Mark Cuban, owner of the Dallas Mavericks, concurs. "With technology, apps, and always-on access, it's something that will be a new form of entertainment that affects us all. It could finally become fun to go to a baseball game again!"

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