Speaker 1: Pushkin.
Speaker 2: It's always sort of dumb to pick a single moment
Speaker 2: when everything changed, But there actually was a moment when
Speaker 2: the American sports fan changed. It came in nineteen seventy nine,
Speaker 2: before the start of the baseball season, a writer named
Speaker 2: Dan Oakrin taught a bunch of friends a weird new
Speaker 2: game he'd invented. Dan's game worked like this. The players
Speaker 2: each picked their own baseball team from the entire pool
Speaker 2: of real life current baseball players. Your imaginary team gets
Speaker 2: credit for whatever those baseball players do in future real
Speaker 2: life baseball games. You win by being the best at
Speaker 2: predicting what individual baseball players will do. This kind of
Speaker 2: game eventually got called fantasy baseball. Fantasy play spread to
Speaker 2: other sports. People sometimes bet money on their fantasy teams.
Speaker 2: They might pay a fee, are a fantasy tournament, and
Speaker 2: the winner gets to keep the pot. But the money
Speaker 2: isn't really the point. The point is to spend all
Speaker 2: baseball season with your friends and your fantasy teams. But
Speaker 2: then in two thousand and nine, this company in Scotland
Speaker 2: gets created by some techies who aren't even interested in
Speaker 2: sports fan duel. It's called These techies think they might
Speaker 2: find a way to make money off fantasy sports by
Speaker 2: speeding it up by making it a daily competition. Instead
Speaker 2: of waiting all season to see who won your league,
Speaker 2: you pick your teams for a single day of games.
Speaker 2: Instead of one contest per baseball season, you have one
Speaker 2: hundred and sixty two.
Speaker 3: What they found very early on as they tested their products,
Speaker 3: they showed kind of an early version of daily fantasy
Speaker 3: sports to users.
Speaker 2: This is Albert Chen, sports writer, author of a book
Speaker 2: about all this called Billion Dollar Fantasy, And.
Speaker 3: They showed it to a guy and sort of like
Speaker 3: this focus career have been. He's like, yeah, this looks like,
Speaker 3: you know, sure, a daily version of fantasy sports that
Speaker 3: my thirteen year old would play. And then they were like, well,
Speaker 3: what if you can actually win some money off of this?
Speaker 3: And he was suddenly very interested in that. It's the
Speaker 3: money aspect.
Speaker 2: By twenty twelve, millions of Americans are playing fantasy sports.
Speaker 2: Some guys in Boston create a second company called DraftKings
Speaker 2: to compete with fan duel. Venture capitalists throw money at them.
Speaker 2: Before the twenty fifteen NFL season, these two companies are
Speaker 2: outspending the entire beer industry on TV ads.
Speaker 3: I'm seeing these commercials that are appearing, and I would
Speaker 3: later learn at a rate of every ninety seconds. And
Speaker 3: it was just an avalanche of ads that were frankly terrible.
Speaker 3: You know, ads that look like they were three AM
Speaker 3: infomercial hair Club for men.
Speaker 1: Ads. There were testimonials.
Speaker 4: Best of all, you could win a shipload of money.
Speaker 4: Use promo code kick to play and get free entry
Speaker 4: into the Millionaire Grand Final, be crowned to Fantasy Football Millionaire,
Speaker 4: Get to DraftKings dot com.
Speaker 2: What these companies do is different from old fashioned fantasy sports.
Speaker 2: Their games are fast, they're played not by friends in person,
Speaker 2: but by strangers online, and they involved serious money.
Speaker 3: These ads were about people who were making ten thousand dollars,
Speaker 3: fifteen thousand dollars, a million dollars and just like a
Speaker 3: lottery ticket, winning just an insane amount of money. So
Speaker 3: that caught my eye.
Speaker 2: That caught a lot of eyes, and not always the
Speaker 2: eyes the companies wanted to catch.
Speaker 3: They caught the eye of the law. People were one,
Speaker 3: how is this? First of all, how is this on
Speaker 3: my TV screens? Because sports gambling is illegal and this
Speaker 3: sure smells like sports gambling, right.
Speaker 2: I'm Michael Lewis and this is against the rules. This season,
Speaker 2: we're exploring the role of fans in American life. We've
Speaker 2: come to the point where the sports fan is about
Speaker 2: to take the field against American law. You can probably
Speaker 2: guess who's going to win, but no one has ever
Speaker 2: 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
Speaker 2: URIC that lobbies state legislature, is on behalf of various clients,
Speaker 2: including back in twenty fifteen, fantasy sports companies.
Speaker 5: You're basically putting money down on something that involves an athlete,
Speaker 5: and you're getting paid back something if you win. That
Speaker 5: to us sounds like sports betting. So a number of
Speaker 5: state attorneys general issued opinions that these contests had to
Speaker 5: cease and desist.
Speaker 2: In twenty fifteen, Jeremy gets hired by DraftKings and Fan Duel.
Speaker 2: Nearly every state has a law that forbids running a
Speaker 2: sports book, and even if they wanted to legalize it,
Speaker 2: they couldn't thanks to a federal law created by New
Speaker 2: Jersey Senator Bill Bradley Jeremy Kudon's job is to try
Speaker 2: to prevent states from extending those anti gambling laws to
Speaker 2: fantasy sports, and ideally to get states to pass bills
Speaker 2: that explicitly legalize fantasy play. But Jeremy needs an argument
Speaker 2: for why legislators should do this.
Speaker 5: So in most states, if you can show that there
Speaker 5: is more skill than there is luck, then you will
Speaker 5: be able to say this isn't a form of gambling,
Speaker 5: and therefore he is legal like most states allow you
Speaker 5: to have. Like golf tournaments are legal, fishing tournaments are legal.
Speaker 2: That's his argument. Fantasy sports are games of skill, more
Speaker 2: like phishing tournaments than playing the slots. To prove his point,
Speaker 2: he hires an economist. The economists runs some numbers to
Speaker 2: show that the best fantasy football players are better at
Speaker 2: building teams than any actual NFL general manager. Jeremy's argument
Speaker 2: raises at least one question, why does states think that
Speaker 2: gambling is all luck? But let's leave that to one side.
Speaker 2: Because Jeremy didn't have a lot of time for philosophy.
Speaker 2: He was in a hurry to flip the switch in
Speaker 2: as many states as possible. How'd you pick which states
Speaker 2: to start with?
Speaker 5: We were focusing on smaller legislatures at the time, where
Speaker 5: this would be something that would interest them and that
Speaker 5: we would have time to actually pass.
Speaker 2: It smaller legislatures. That was one trait that made a
Speaker 2: state open to his, say els pitch, But there were
Speaker 2: other less obvious ones.
Speaker 5: You know, I wanted to have male dominated legislatures at
Speaker 5: the time because I, you know, I felt like it
Speaker 5: would be easier to explain the issue.
Speaker 2: You actually thought of that, that it was going to
Speaker 2: be easier to sell us to guys than to women.
Speaker 2: I did, yes, Why and why did you think that?
Speaker 5: Because, well, some of the women and look, there's a
Speaker 5: 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
Speaker 5: have no idea what you're talking about. That just sounds
Speaker 5: like gambling. And with a lot of the men are like,
Speaker 5: oh no, I do fantasy sports. You're telling me this
Speaker 5: is gambling. There's no way this is gambling. It is
Speaker 5: for my friends.
Speaker 2: Kansas is the first to explicitly legalize daily pay to
Speaker 2: play fantasy sports. Not obvious, right, I mean, in fact,
Speaker 2: pretty random. If you had to guess which state would
Speaker 2: be the first to let its citizens off any leash.
Speaker 2: Kansas isn't who you'd pick. Once he has Kansas in
Speaker 2: the bag, Jeremy persuades twenty two more states to pass
Speaker 2: laws allowing fantasies sports. After he's finished, the color coded
Speaker 2: map of where fantasy is legal will look nothing like
Speaker 2: the usual red and blue political maps we spend our
Speaker 2: lives staring at. For example, both Arkansas and New York
Speaker 2: will allow fantasy sports, but both Hawaii and Idaho will
Speaker 2: forbid it. And when Jeremy's done, twenty three otherwise unrelated
Speaker 2: states will share one very important thing in common. They
Speaker 2: will all have legalized fantasy sports, which suggests they might
Speaker 2: be gained to legalize some other stuff. How do you
Speaker 2: 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,
Speaker 2: he grew up within one hundred miles of Trenton, New Jersey,
Speaker 2: and went to a grade school with an illegal sport.
Speaker 2: It's gambling ring inside of it.
Speaker 7: The first time I actually saw one of the typical
Speaker 7: the classic NFL parlay tickets that you see get handed
Speaker 7: out that White Parley tickets in the second grade, and
Speaker 7: then the first one I played one was in the
Speaker 7: fifth grade.
Speaker 2: Joe grows up in the early two thousands, goes to
Speaker 2: work for an Internet company. The internet's new back then,
Speaker 2: and people are wondering what other people might want to
Speaker 2: do on it. Joe thinks one thing they might want
Speaker 2: to do gamble on sports, a service illegal to provide
Speaker 2: almost anywhere outside of Nevada.
Speaker 6: Sports betting was always referred to, at least in gaming
Speaker 6: 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
Speaker 2: now most people have forgotten that it's Bill Bradley's law.
Speaker 2: They just call it by its acronym PASPA. Past has
Speaker 2: been the law of the land for a long time.
Speaker 2: Everyone seems to be for it and no one seems
Speaker 2: to be against it. The NFL, the NCAA, the NBA,
Speaker 2: Major League Baseball, every major sports institution in America says
Speaker 2: sports gambling is evil. Joe doesn't care. He sees a
Speaker 2: business opportunity. He raises some money, creates a firm to
Speaker 2: lobby for change, and the change starts the way it
Speaker 2: always starts in Washington with panel discussions.
Speaker 6: I was invited to speak at the annual Sports Law
Speaker 6: Conference because it was here in Washington, DC, and was
Speaker 6: on a panel about legal sports betting.
Speaker 2: This is in twenty twelve. The room's mostly filled with
Speaker 2: like minded people. People who want sports betting legalized, many
Speaker 2: of whom have grown up within one hundred miles of Trenton,
Speaker 2: New Jersey. People who think, why can't these idiots who
Speaker 2: hate sports gambling see that their law is dumb since
Speaker 2: every school kids already doing it. A regulator from the
Speaker 2: state of Missouri was speaking.
Speaker 6: There was a gentleman sitting in the audience, and boy,
Speaker 6: this guy was casually dressed. He was just in like
Speaker 6: rugby shorts and a really you know, well worn polo
Speaker 6: shirt and you know, in between guffaws and saying things
Speaker 6: under his breath, the Missouri regulator asked him, is there
Speaker 6: something that you would like to say?
Speaker 1: Sir?
Speaker 6: Do you have a question for us? And they handed
Speaker 6: him the mic and he stood up and he said,
Speaker 6: I probably have more to do with that law PASPA
Speaker 6: being enacted than anybody else. My name is Jay Moyer,
Speaker 6: and I am the general counsel and executive vice president
Speaker 6: of the NFL. And there was a combination of dead
Speaker 6: silence and then the panelgon like whoa I said something
Speaker 6: 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
Speaker 6: very very strong opinion as to why that law was
Speaker 6: enacted and why I should stand. And there was about
Speaker 6: the sanctity of the contests and that they should never
Speaker 6: be called into question, and that with gambling, it would
Speaker 6: be inevitable that it would just descend into madness, that
Speaker 6: people would never trust sports ever. Again, he wasn't mister
Speaker 6: popularity in that room. Some of the audience started to
Speaker 6: say things, some of the folks on the panels started
Speaker 6: to say things, and to the point where mister Moyer
Speaker 6: definitely got flustered, and he finally he pointed his finger
Speaker 6: at us, and very red face he said, and I'll
Speaker 6: never forget this. I guarantee you this. You will never
Speaker 6: overturn that law.
Speaker 2: You heard Joe laughing there. He was already working to
Speaker 2: overturn that law by getting.
Speaker 6: A state to fe You start looking at Okay, well,
Speaker 6: what's a good state to start with. Who's going to
Speaker 6: be our test case? And Jersey was obvious Why So
Speaker 6: it was a combination of things. Was New Jersey was
Speaker 6: already very motivated to find something for Atlantic City to
Speaker 6: reverse its decline.
Speaker 2: People weren't packing the Atlantic City casinos the way they
Speaker 2: used to. Sports gambling was like the thing every Jersey
Speaker 2: boy did with his lunch money. And maybe most importantly,
Speaker 2: because after all this was New Jersey, there was a
Speaker 2: guy you could see.
Speaker 6: There was this one loan state legislator in New Jersey,
Speaker 6: Senator ray Lesniak.
Speaker 8: First of all, I was chairman of the Senate Economic
Speaker 8: Development Committee.
Speaker 2: Ray Lesniak now retired, but once a New Jersey State senator,
Speaker 2: I could get anything through the legislature. I passed the
Speaker 2: first law in the nation polishing the death penalty.
Speaker 8: That was not easy. I got a whole bunch of things. Yeah,
Speaker 8: I was pretty I was the main man in those days.
Speaker 2: As main man, ray thought he had a firm grip
Speaker 2: on New Jersey. He thought he could fix anything about
Speaker 2: it that bothered him. But then a friend of mine,
Speaker 2: Rudy Garcia, was arrested for placing a sports bet with
Speaker 2: a local bookie that happened back in March of two
Speaker 2: thousand and seven as part of an FBI sting. Rudy
Speaker 2: Garcia wasn't just Ray's friend. He was the former mayor
Speaker 2: of Union City, New Jersey, a lobbyist and an important
Speaker 2: ally in Jersey politics until he got whacked. That's amazing
Speaker 2: to me that anyone bothered arresting him. Who's arresting a
Speaker 2: guy who's placing best sports bets with his friends in
Speaker 2: a bar.
Speaker 8: Well, there was a set up, obviously, it was a
Speaker 8: 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
Speaker 8: local grocery store when I was growing up.
Speaker 2: Of course he did, and the idea that Rudy Garcia
Speaker 2: got arrested for placing bets offended raised sense of right
Speaker 2: and wrong.
Speaker 8: He was arrested for doing something he could have gotten
Speaker 8: on a plane and flew to Las Vegas to do.
Speaker 2: And so Ray tries to do what he can usually
Speaker 2: easily do, change New Jersey state law, in this case,
Speaker 2: to legalize sports betting, even though it puts him in
Speaker 2: an odd emotional position because he himself has a complicated
Speaker 2: 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,
Speaker 8: I found myself on the Gothel's Bridge going to the
Speaker 8: betting polo.
Speaker 2: I just was like attracted there. I didn't even think
Speaker 2: about it.
Speaker 8: I said, Holy, here's my lane, which I was about
Speaker 8: to say, Well, that was a wake up call.
Speaker 2: I was full fledged atic for sure. Ray knew the dangers,
Speaker 2: but he didn't like anti sports betting laws or the
Speaker 2: fact that they were being used against his friend Rudy Garcia.
Speaker 2: Even though Rudy was never actually charged, the damage was
Speaker 2: done by this stupid law. So Ray decides to fight
Speaker 2: Bradley's law. But this he cannot do without the Governor
Speaker 2: of New Jersey's help, and the Governor of New Jersey
Speaker 2: at the time is Chris Christy.
Speaker 8: Strangely enough, Christy and I do not get along at all,
Speaker 8: but he is.
Speaker 2: A very polite person.
Speaker 8: One of the things reasons why we didn't get along
Speaker 8: is that eight times he tried to block my effort
Speaker 8: to legalize sports.
Speaker 2: Betting without the governor on board. Raised powerless. But then
Speaker 2: he hears from Joe Brennan, Washington lobbyist for Internet sports gambling.
Speaker 2: Joe has a pile of money enough to get a
Speaker 2: proposition on the state ballot in twenty eleven to ask
Speaker 2: the people of New Jersey directly if they want to
Speaker 2: legalize sports betting. And you can guess what they decided.
Speaker 7: Folks in the state of New Jersey voted yesterday to
Speaker 7: legalize sports betting.
Speaker 2: The referendums just for show. It has no legal effect,
Speaker 2: but still two thirds of the voters in New Jersey
Speaker 2: vote to legalize sports betting. And how could they not?
Speaker 2: Three quarters of their children are already doing it. Ray
Speaker 2: 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
Speaker 9: is formally submitting our sports gambling regulations this week. When
Speaker 9: you looked at the black market in sports betting, you're
Speaker 9: talking about billions of dollars that's bet you know, was
Speaker 9: used to be bet on the black market in sports
Speaker 9: 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
Speaker 9: not only create you know, great economic benefit for the state.
Speaker 2: Did you how did you have any sense of the
Speaker 2: size of the black market. Had you bet yourself?
Speaker 9: No, I was not someone who had bet myself, not
Speaker 9: 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
Speaker 9: available in your school that would pass out these these
Speaker 9: like cards with the spreads for the football games on Sunday,
Speaker 9: and yeah, you'd bet five bucks and give them a card.
Speaker 9: And it was, you know, a fellow classmate as a
Speaker 9: 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
Speaker 2: bookies slips into the high school. Like, was this a
Speaker 2: 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
Speaker 2: they share a public garden. If they can mow down
Speaker 2: the rose bushes and develop it, they could both get rich.
Speaker 2: 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
Speaker 9: of large scale would kill the integrity of sports. He
Speaker 9: also used to tell me that he didn't want to
Speaker 9: be bet on like he was a horse. He was
Speaker 9: a human being, and he didn't want to be bet on,
Speaker 9: and he didn't want his performance bet on. So you know,
Speaker 9: I reminded the Senator any number of times that it
Speaker 9: already was being bet on, just not legally.
Speaker 2: Did you get where Bradley was coming from? Did anything
Speaker 2: he say make any sense to you?
Speaker 9: It made some sense to me, but I thought it
Speaker 9: was extraordinarily naive. And look, that wouldn't be the first
Speaker 9: time that Senator Bragley was accused of being naive. In fact,
Speaker 9: I think it's one of his greater character traits because
Speaker 9: it led him to think in a much different way
Speaker 9: than a lot of people. A lot of other people do,
Speaker 9: especially in New Jersey.
Speaker 2: Let's recap here a bit. In nineteen ninety two, New
Speaker 2: Jersey Senator Bill Bradley gets Congress to pass a law
Speaker 2: banning most states from legalizing sports gambling, but illegal gambling
Speaker 2: carries on in his home state, And meanwhile, fantasy sports
Speaker 2: starts taking off and states around the country are persuaded
Speaker 2: to legalize that. In twenty eleven, the voters of New
Speaker 2: Jersey let it be known loudly they'd like sports betting
Speaker 2: to be legal. Now, Chris Christy, the governor who previously
Speaker 2: opposed sports betting, is not only saying he'll let it happen,
Speaker 2: he's preparing to pick a fight with Bill Bradley's law.
Speaker 2: Explain what's its stack here, and that how the federal
Speaker 2: government wasn't banning sports betting, it was preventing states from
Speaker 2: legalizing it, which is different.
Speaker 1: Right, And.
Speaker 9: Essentially, what we said was if the federal government tells
Speaker 9: you that you cannot do something, then they have to
Speaker 9: provide the regulatory muscle to prevent it from happening. And
Speaker 9: they weren't doing that. They basically just told us you
Speaker 9: can't do it. And by the way, if anybody's doing
Speaker 9: it in your state, you're responsible for preventing it.
Speaker 2: Chris Christy and Ray Lesniak both fought in their separate
Speaker 2: ways that Bill Bradley's law was unconstitutional. I mean, after all,
Speaker 2: Congress could have simply banned sports gambling, but it hadn't,
Speaker 2: mainly because it carved out an exception for Nevada. So
Speaker 2: the law was weird. And Ray gets the vote to
Speaker 2: pass the law legalizing sports betting in New Jersey, and
Speaker 2: Chris does indeed sign it. Then the two gentlemen in
Speaker 2: New Jersey sit back to see what will happen next.
Speaker 2: So how often do you have clients come to you
Speaker 2: and say, I'm going to break the law, so I
Speaker 2: need you to make the law go away.
Speaker 10: Well, I don't recall too many occasions when someone's come
Speaker 10: to me and said I'm going to break the law.
Speaker 2: Meet Ted Olsen, maybe the greatest living constitutional lawyer, who,
Speaker 2: in twenty twelve, to Chris Christie's delight and surprise, has
Speaker 2: not already been locked up by the NFL, or the
Speaker 2: NBA or the NCAA.
Speaker 10: What happened here was that we wanted to test the constitutionality.
Speaker 10: Nobody broke the law. The legislature passed a statute changing
Speaker 10: New Jersey's constitution and statutes, and at that point our
Speaker 10: opponents came in and asked the court to stop that
Speaker 10: process as from taking place.
Speaker 2: Okay, so the politicians in New Jersey didn't exactly break
Speaker 2: the law. They passed a law that broke the law,
Speaker 2: knowing that they'd be sued by everyone who liked that law,
Speaker 2: and knowing that ted Olsen was just the guy to
Speaker 2: fight back.
Speaker 10: It's very rare that you have an opportunity to challenge
Speaker 10: the constitutionality of an Act of Congress and seek a
Speaker 10: court to overturn an Act of Congress on constitutional grounds.
Speaker 10: This was one where there was not much precedent.
Speaker 2: By the time you come to challenge this law, it's
Speaker 2: twenty years old. How unusual is it for a law
Speaker 2: to sit there for that long before it's challenged.
Speaker 10: Well, it's very unusual. In the first place. The desire
Speaker 10: to pass this statute was perceived as doing good to
Speaker 10: stop people from betting on sports, stop the potential corruption
Speaker 10: of athletes and the temptations that might be put before
Speaker 10: him through money. Nobody challenged it. Why is the Supreme
Speaker 10: Court going to get involved in that now?
Speaker 2: But the Supreme Court's been drifting in a new direction
Speaker 2: for a while, and ted Olsen has helped it to drift.
Speaker 2: His fingerprints are all over the black robes. Back in
Speaker 2: the early nineteen eighties, along with a bunch of law students,
Speaker 2: Ted helped to foster something called the Federalist Society, and
Speaker 2: the Federal Society then evolves into sort of a farm
Speaker 2: team for the Supreme Court. Justices Samuel Alito, Brett Kavanaugh,
Speaker 2: Neil Gorsich, and Amy Cony Barrett are all members. So
Speaker 2: ted Elson not only knows them, they're all in the
Speaker 2: same club. That's one reason you hire ted Olsen to
Speaker 2: argue your case. His presence alone signals to the Supreme
Speaker 2: Court that this case might be worth having a look at.
Speaker 2: It's like having Brad Pitt attached to your movie. This
Speaker 2: case interests you. How do you decide how to argue it?
Speaker 2: Like you can just kind of take me inside your process.
Speaker 10: The federal government in this case had the power to
Speaker 10: regulate gambling. It could regulate gambling under the Interstate Commerce
Speaker 10: Clause if it was commerce, and it certainly was, but
Speaker 10: the Congress did not choose to do it that way.
Speaker 10: It said states may not authorize or permit gambling on sports. So,
Speaker 10: in other words, what Congress was doing was, we want
Speaker 10: to prohibit this activity, but we want the states to
Speaker 10: do it. States will take the responsibility and the blame
Speaker 10: and the credit or the blame for doing it because
Speaker 10: the federal government stepped aside just demanding that the states
Speaker 10: do it, and the states will spend their money to
Speaker 10: pass a statute and enforce a statute. There is the
Speaker 10: federal government going to do something, it should take responsibility
Speaker 10: for it. It should pay for the enforcement.
Speaker 2: Ted Olson has lit upon what in constitutional law is
Speaker 2: known as the anti I'm endearing doctrine. The doctrine is
Speaker 2: actually not in the Constitution. It's an interpretation of the
Speaker 2: Tenth Amendment, and the tenth Amendment says the power is
Speaker 2: not delegated to the United States by the Constitution, nor
Speaker 2: prohibited by it to the States, are reserved by the states,
Speaker 2: respectively or to the people. In other words, according to
Speaker 2: this interpretation, Congress shouldn't try to get its way by
Speaker 2: compelling states to do something or not to do it anyway.
Speaker 2: Chris Christy heard this argument and he really liked his
Speaker 2: 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,
Speaker 2: and I.
Speaker 9: Said to him, Roger, let's just you and I settle this.
Speaker 9: Let's come up with a set of circumstances where it's
Speaker 9: agreeable to the NFL, And so we sat there for
Speaker 9: lunch that day, and Roger's a very good guy. He
Speaker 9: just said to me, Chris, you got to just drop
Speaker 9: the case because we're going to embarrass you. You know,
Speaker 9: we're gonna beat you. We're gonna embarrass you, and you're
Speaker 9: spending public money to do this and it's not gonna
Speaker 9: 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.
Speaker 2: No judge in the lower courts was buying ken Olsen's argument,
Speaker 2: but at one point, a lawyer for the NFL says,
Speaker 2: we aren't saying you have to enforce a prohibition. We're
Speaker 2: not saying you need to do anything to prevent sports gambling.
Speaker 2: You just can't legalize it.
Speaker 9: So okay, So we went back and passed the legislation
Speaker 9: that essentially took the hands off position. I said, we're
Speaker 9: not to do anything, but we're sure as that hell
Speaker 9: not going to enforce stopping anybody from doing it. They
Speaker 9: aren't going to legalize sports gambling. They're just going to
Speaker 9: tell their citizens that no one minds if they bet
Speaker 9: on sports. It's a funny move. And they must have
Speaker 9: they never have expected you to do that, correct, And
Speaker 9: I think it's like taking the speed of lim it
Speaker 9: signs down on the highway. Yeah, and then we tell
Speaker 9: people and we're not going to pull you over like
Speaker 9: have had it, you know. And so we do it,
Speaker 9: and the league sue us.
Speaker 2: And so New Jersey's lawyer Ted Olsen, who returns for
Speaker 2: yet another season. He gone oh in three his first season,
Speaker 2: which ended in twenty fifteen. In the second season, he
Speaker 2: goes oh to four. It's now late twenty and seventeen,
Speaker 2: and at this point, seven different courts have ruled against
Speaker 2: New Jersey.
Speaker 9: I've already spent at this point about six million dollars
Speaker 9: in legal fees. So Ted calls me and he says, look,
Speaker 9: 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
Speaker 1: take it.
Speaker 2: File for cert means asking the Supreme Court to hear
Speaker 2: the case. If they don't hear it, no state's going
Speaker 2: to challenge pass by again. Anyone who wants sports gambling
Speaker 2: to be legal is going to have to ask Congress
Speaker 2: to pass a new law, and good luck with that.
Speaker 2: The Supreme Court gets roughly eight thousand requests a year
Speaker 2: to hear cases, and it accepts only eighty. But in
Speaker 2: twenty seventeen, the Supreme Court announced it wanted to hear
Speaker 2: New Jersey's case.
Speaker 11: I think the nineteen eighties and nineteen nineties the Supreme
Speaker 11: Court rediscovers what it calls federalism.
Speaker 2: Alison Lacroix she teaches at the University of Chicago Law
Speaker 2: School and has written a book called The Innerbellum Constitution.
Speaker 2: It's about the Supreme Court in the decades before the
Speaker 2: Civil War, a period that interested her because that Supreme
Speaker 2: Court rhymes with ours. The state's rights cases were everywhere.
Speaker 2: Slavery was the main issue, of course, but there are
Speaker 2: lots of others, just like now, abortioning guns are the
Speaker 2: main issues, but there are lots of other issues that
Speaker 2: the society's failing to resolve on the national level. What's
Speaker 2: behind this rediscovering of states rights?
Speaker 11: One view says federalism isn't even a real thing. It's
Speaker 11: just about whoever's not in power in the center is
Speaker 11: going to become a defender of peripheral power. You know,
Speaker 11: if you don't control Washington, you're going to be the
Speaker 11: person saying that's okay because my state or my city
Speaker 11: can make its own policy, and there's no there there.
Speaker 11: 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
Speaker 2: some abstract principle. It's just camouflage for your desire for
Speaker 2: some concrete outcome. But Allison thinks it's deeper than that.
Speaker 11: I think what's behind the resurgence of states' rights is
Speaker 11: it's a forum or a kind of crucible to have
Speaker 11: deep existential arguments, especially when the political system, as in
Speaker 11: the partisan system, seems to not be functioning because federalism
Speaker 11: lets you kind of go outside parties or seem to
Speaker 11: and say, now I'm talking about this deep constitutional structure.
Speaker 2: In other words, we're seeing a rise in these sorts
Speaker 2: of cases because Congress has lost its ability to resolve disputes.
Speaker 2: Sports gambling is sort of an example of this because
Speaker 2: back when he introduced his bill in the early nineties,
Speaker 2: Bill Bradley was unable to get Nevada to go along
Speaker 2: all the way with him, so he was forced to
Speaker 2: propose this weird law. It's rather than banning the thing outright,
Speaker 2: just tell states they can't legalize it. Any federal law
Speaker 2: that shackle states in this way was bound to catch
Speaker 2: the eye of a Supreme Court skeptical of federal authority.
Speaker 11: And so it feels like there's this through line theme
Speaker 11: connecting a lot of the cases. But it's also funny.
Speaker 11: I mean, this goes to the question as well, which
Speaker 11: is the Court is not hostile to federal power when,
Speaker 11: especially when the federal power at stake is the Court's
Speaker 11: own power. They have this way of talking about themselves
Speaker 11: or not talking about themselves, and implying that they're not
Speaker 11: one of the branches of the federal government, like they're
Speaker 11: 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.
Speaker 10: They are arrayed all night of them in something close
Speaker 10: to an arc, so that the justices and they're arranged
Speaker 10: and by in order of seniority.
Speaker 2: By that day, December the fourth, twenty seventeen, ted Olsen
Speaker 2: had already argued sixty two cases before the court. This
Speaker 2: would be his sixty third appearance.
Speaker 10: The Chief Justice is probably six seven eight feet from
Speaker 10: the podium where you're standing. You stand still, you don't
Speaker 10: move about, and you stand up straight and address the
Speaker 10: court as much as you can.
Speaker 2: New Jersey Governor Chris Christy was in court that day watching.
Speaker 2: He had a front row seat. We'll hear an argument
Speaker 2: first this morning in case sixteen four to seventy six,
Speaker 2: Christy versus NCAA.
Speaker 10: Mister Olson, thank you, mister Chief Justice, and may have
Speaker 10: pleased the court.
Speaker 2: That's how ted Olsen began. But Supreme Court hearings are
Speaker 2: less like TV trials than job interviews. The lawyers each
Speaker 2: stand there in front of the justices for about thirty minutes,
Speaker 2: and the justice is just pepper them with questions. Christy
Speaker 2: watches the action closely. He sort of knows he's gonna win.
Speaker 2: I mean, why here the case if you aren't going
Speaker 2: to overturn the law. But there's still some drama. It's
Speaker 2: like when you know a guy in the Sopranos is
Speaker 2: about to get taken out, but you don't know how
Speaker 2: or who's gonna do it. Christy's especially interested in Justice
Speaker 2: sam Alito.
Speaker 9: Sam is a former US attorney in New Jersey, so
Speaker 9: 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
Speaker 1: his father did.
Speaker 9: Yeah, his father was a huge sports fan, and Sam
Speaker 9: is a huge sports fan. I can't imagine that Sam,
Speaker 9: that Sam Alino Senior did not, you know, put a
Speaker 9: couple of bucks down every once in a while on
Speaker 9: a Phillies or an Eagles game.
Speaker 2: He can't imagine that Sam Junior won't play the starring
Speaker 2: role in this Jersey show, which is maybe why in
Speaker 2: the story Christie is about to tell, he gives Justice
Speaker 2: Alito the big moment when the big moment wasn't his.
Speaker 2: But I gotta let Christy do it, even if it
Speaker 2: doesn't quite match the record.
Speaker 9: The best moment was Alito because Alito said to Clement, Okay,
Speaker 9: let me understand something.
Speaker 2: It was actually Chief Justice Roberts who says this, and
Speaker 2: it was another lawyer on the other side he said
Speaker 2: it too, but never mind.
Speaker 9: He said, so, let me make sure I understand what
Speaker 9: you're saying. You believe the public in New Jersey and
Speaker 9: any other state that followed them would be better off
Speaker 9: if the state put absolutely no restrictions on this at all.
Speaker 9: And he goes, absolutely right, Justice Alito and he goes, Okay,
Speaker 9: 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
Speaker 9: and bet his lunch money that is pas parents had
Speaker 9: given him on the Eagles game this weekend, you think
Speaker 9: that would be better. If he says, yes, it would
Speaker 9: be better, you look like you're ridiculous. If, on the
Speaker 9: other hand, you said, well no, well then you start
Speaker 9: to go down the slippery slope of allowing us to
Speaker 9: do some things but not other things, and then the
Speaker 9: Feds are making the qualitative judgment on something that they
Speaker 9: themselves are.
Speaker 1: Unwilling to enforce.
Speaker 9: He said yes, and Alito grabbed his like YETI and
Speaker 9: took a big swig of whatever was in.
Speaker 2: There, because in New Jersey you never know what's in
Speaker 2: the YETI, And.
Speaker 9: He said something to the effect of you really don't
Speaker 9: believe that, but you know. Then at that moment, I
Speaker 9: thought to myself, Okay, we're in really good shape here.
Speaker 2: Ted Olsen has this ritual after every Supreme Court case,
Speaker 2: he takes his team out for a meal. He goes
Speaker 2: around the take and ask each person to predict how
Speaker 2: the Supreme Court will rule. Often they're split unsure, but
Speaker 2: here no one had any doubt. Christy went back to
Speaker 2: New Jersey, knowing that he was playing a new hand.
Speaker 9: I got a call from Roger Goodell and he said, Hey,
Speaker 9: I'm flying out of Titterborough to go to some game.
Speaker 9: Do you have time for us to have a meeting.
Speaker 9: I'm like, sure, Roger, I'll come meet with you. So
Speaker 9: we met in a conference room at the airport in
Speaker 9: Teterborough and he said to me, look, why don't we
Speaker 9: talk about settling this? And I started to laugh and
Speaker 9: I said, Roger, I'm going to put this in language
Speaker 9: that you understand. I said, you're asking me to punt
Speaker 9: when it's first in goal.
Speaker 1: No thanks.
Speaker 2: Nearly six months later, on May fourteenth, twenty eighteen, the
Speaker 2: Court issued its ruling on Bill Bradley's law. All you
Speaker 2: really need to hear is this one line that Justice
Speaker 2: Samuel actually said.
Speaker 6: We therefore hold that the Passbook provision outlawing state authorization
Speaker 6: of sports gambling is unconstitutional.
Speaker 2: It had been a Jersey job from start to finish,
Speaker 2: and there was one funny little twist which ray Lesniat
Speaker 2: no doubt enjoyed Before the ruling. Chris Christie's term as
Speaker 2: governor had ended. Phil Murphy was the new governor of
Speaker 2: New Jersey, which is why the case is now and
Speaker 2: forever called Murphy versus the NCAA. In retrospect, it's sort
Speaker 2: of amazing how shocked everyone was. How out of the
Speaker 2: clear blue sky this lightning bolt came. Did you see forces,
Speaker 2: any forces kind of at work to undermine the legislation
Speaker 2: before the Supreme Court decision? Nobody said anything to you,
Speaker 2: But did you were you know? Okay, I thought they
Speaker 2: didn't say anything to me. That's former New Jersey Senator
Speaker 2: Bill Bradley, who you might have thought would have seen
Speaker 2: the writing on the wall. But you didn't see the
Speaker 2: 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,
Speaker 2: the company's position to dominate the new sports gambling industry,
Speaker 2: they hadn't seen it coming either. I want you to
Speaker 2: describe in more detail the moment you learn that the
Speaker 2: 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
Speaker 2: legalized in twenty three states on behalf of Fan Duel
Speaker 2: and DraftKings.
Speaker 5: And I see all of a sudden, a bunch of
Speaker 5: texts from people you know in the industry saying, oh
Speaker 5: my god, the court granted sir, which again means agreed
Speaker 5: to hear the case. And I was like, what court
Speaker 5: and what case?
Speaker 2: FanDuel and DraftKings were like people who bought a home
Speaker 2: on top of an oil field without knowing it. The
Speaker 2: Beverly Hillbill is of gambling.
Speaker 5: We ran, I think, I mean literally ran to Jason Robbins,
Speaker 5: who's the CEO of DraftKings office, which I mean it
Speaker 5: wasn't a long run at the time, and you know,
Speaker 5: had to explain, hey, what we were even talking about,
Speaker 5: and then explain what this meant, and you know, his
Speaker 5: eyes looked like saucers, and you know it was one
Speaker 5: of these things like, wow, we never get this lucky,
Speaker 5: this is the greatest day. I mean, this changed everything.
Speaker 2: Jeremy had already sold twenty three states on fantasy sports
Speaker 2: by arguing that fantasy sports wasn't gambling. Now that sports
Speaker 2: gambling was on the verge of becoming legal, he need
Speaker 2: to go back with a new argument. Which would go
Speaker 2: something like this. Look, you've let us do fantasy sports,
Speaker 2: which we all know has a lot in common with gambling,
Speaker 2: so you're already halfway there. Jeremy sensed an opening. Every
Speaker 2: state that allowed fantasy sports might allow sports gambling fast,
Speaker 2: because they could take a cut of it. No one
Speaker 2: remembers this, but back in twenty eighteen, both FanDuel and
Speaker 2: DraftKings were small companies running on fumes. It was unclear
Speaker 2: whether either would survive. Two years after the Supreme Court decision,
Speaker 2: each would be valued at least twenty billion dollars, and
Speaker 2: together they would basically shape the world in which the
Speaker 2: American sports gambler would live. Jeremy had spent all this
Speaker 2: time arguing for the moral superiority of games of skill
Speaker 2: over games of chance, but the boom about to happen
Speaker 2: was all just sheer dumb luck. In part two of
Speaker 2: the season, we're going to explore the soul of the
Speaker 2: new machine, this vast new gambling industry that, through sports,
Speaker 2: is changing our culture.
Speaker 5: I don't know anybody who's ever been in gambling thought
Speaker 5: 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
Speaker 12: like thirty thousand dollars on that front seat and being like,
Speaker 12: oh my god, so much money in cash in cash.
Speaker 2: That's all still to come. But first I want to
Speaker 2: let you listen in for longer on some of the
Speaker 2: conversations we've had for these episodes. We usually talk to
Speaker 2: people and they just use bits and pieces of what
Speaker 2: they tell us, but I'd like you to hear more
Speaker 2: of it about the sociology of fandom, about federalism, about politics.
Speaker 2: So over the next few weeks, we'll be bringing you
Speaker 2: some of those interviews. Next week, my full conversation with
Speaker 2: Professor Allison Lcroy Against the Rules is written and hosted
Speaker 2: by Me, Michael Lewis and produced by Lydia gene Kott,
Speaker 2: Catherine Gerardeau, and Ariela Markowitz. Our editor is Julia Barton.
Speaker 2: Our engineer is Jake Gorski. Our music was composed by
Speaker 2: Matthias Bossi and John Evans of stell Wagon Sinfinet. Our
Speaker 2: fact checker is Lauren Vespoli. The Supreme Court audio in
Speaker 2: this episode comes from Oya dot Org Special thanks to
Speaker 2: a few more folks who made this season of Against
Speaker 2: the Rules possible. Jacob Weisberg, Greta Cone, Sarah Nix, Christina Sullivan,
Speaker 2: Kerry Brody, Eric Sandler, Kira Posey, Jordan McMillan, Jake Flanagan,
Speaker 2: Owen Miller, Sarah Buguerier, Jacob Goldstein, and Sophie Krane. Against
Speaker 2: the Rules is a production of Pushkin Industries. To find
Speaker 2: more Pushkin podcasts, listen on the iHeartRadio app, Apple Podcasts
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Speaker 10: I was at the Super somebody's home during the Super
Speaker 10: Bowl a year or so ago, and one of my
Speaker 10: neighbors was there and had this little computer in his
Speaker 10: hander is his cell phone, and he said, I just
Speaker 10: bet that sometime during this game, someone will attempt to
Speaker 10: hit a field goal and it will hit the goal posts.
Speaker 10: And I said, Jesus Christ, you know who would bet
Speaker 10: on something like that. And then about five minutes later
Speaker 10: it happened.
Speaker 2: When that person bet on a field goal, hitting the
Speaker 2: goal post. Did you turn to him and say, do
Speaker 2: you know why you can do this?
Speaker 10: Now he knew