Washington DC Sports Betting Lawsuit Dismissed By Judge

Washington DC Sports Betting Lawsuit Dismissed By Judge

A Washington D.C. Superior Court judge dismissed a lawsuit over the city's no-bid sports betting contract, which the suit argued was a violation of city law. Judge John Campbell ruled this week against plaintiff Dylan Carragher, writing that the District had broad leeway to enter into such contracts, and dismissed the case with prejudice.

The ruling filed Wednesday ends the latest in a long line of controversies surrounding the city’s mobile sports betting app, which still has yet to take its first bet 10 months after the Council approved legal wagering.

Case Background

The D.C. City Council was among the first legislative bodies in the country to support legal sports betting in the wake of the Supreme Court ruling in May 2018 that opened the door for individual jurisdictions to take bets. With similar legalization measures pending in neighboring Maryland and Virginia, Councilmember Jack Evans argued the District need to expedite the implementation of sports betting by bypassing traditional procurement methods, which typically require competing bids.

Evans supported granting the $215 million operator contract to Greek gaming giant Intralot, which already managed the D.C. Lottery. The “Sports Wagering Procurement Practices Reform Exemption Act” passed 7-6, but it would be just the beginning of the D.C. sports betting controversy.

The Washington Post revealed Evans had previously hired an Intralot lobbyist to work for his private business consulting firm, part of a much larger pattern where it was discovered the councilmember had funneled hundreds of thousands of dollars in government contracts to entities that enriched himself. The Post later discovered Intralot had subcontracted its work to a firm with no actual D.C. employees, a violation of city law.

Carragher filed his initial lawsuit in September, focusing on the original no-bid contract. A D.C.-based app developer, Carragher’s legal team argued the no-bid procurement necessitated a public referendum and was therefore invalid.

Carragher received an early legal victory when a judge granted and later extended a temporary restraining order into October that prohibited the D.C. government from paying Intralot as part of the contract. However, a subsequent motion by Carragher for a preliminary injunction, which would have extended the payment prohibition until the case was settled, was denied.

By November, both parties had filed motions for summary judgement, an option permitted when no material facts are in dispute. Thursday, Campbell ruled in the defendant’s favor, upholding the city’s argument that the Exemption Act relating to sports betting was legal under the broad legislative authority for such acts granted to it by D.C. statute.

”The Court emphasizes, as it did in denying Mr. Carragher’s motion for preliminary in junction, that the question before it is not whether the D.C. Council acted wisely in passing the Exemption Act and in approving the award of the contract for Intralot,” Campbell wrote. “The question is whether the D.C. Council acted lawfully. The Court agrees with the District that it did.”

What Comes Next?

D.C. will continue to advance its sports betting app with hopes it could go online in the first quarter of next year. The council voted this week to support expelling Evans for his reported improprieties, but that will have little impact on the progress of the lottery’s mobile app.

The original law to permit D.C. sports betting gave the lottery sole authority to offer mobile wagering on city lands, but it did allow individual sports arenas as well as bars and restaurants to take bets. Capital One Arena has already announced plans to open a William Hill sportsbook in 2020, and a consortium of around 30 bars and restaurants is working to create an online offering that the group hopes to launch in the first few months of next year.

Meanwhile, the dismissed lawsuit concludes one more threat to the D.C. mobile sports betting app, and effectively ends any further legal challenges on the grounds the original no-bid contract violated city law.

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