A Whole New Ballgame: Implications of Legalized Sports Betting for College Athletics

Download Presentation Slides (via PDF) HERE

Panelists

  • Jeff Ifrah, Founder & General Counsel, iDEA Growth Association
  • Heather Lyke, Director of Athletics, University of Pittsburgh
  • Jake Williams, Vice President – Legal & Regulatory Affairs, Sportradar
  • Dan Walsh, Partner, Farragut Partners
  • Stacie Stern, Government Affairs Director, FanDuel

Webinar Recap

With approximately 20 states having already passed legislation since the Supreme Court (SCOTUS) cleared the way for states to legalize sports betting in 2018, legalized sports betting in America is alive and well. The SCOTUS decision, which struck down the Professional and Amateur Sports Protection Act (PASPA), has also opened the door for sports wagering on college campuses.  In that vein, on Tuesday, LEAD1 Association (“LEAD1”) hosted its latest virtual forum, which debated whether legalized sports betting in America could become detrimental to colleges and universities.

The panel, moderated and co-sponsored by Jeff Ifrah, the Founder and General Counsel at iDEA Growth Association, featured Heather Lyke, the Director of Athletics at the University of Pittsburgh, Dan Walsh, Partner at Farragut Partners, who also co-sponsored the forum, Stacie Stern, Government Affairs Director at FanDuel, and Jake Williams, Vice President of Legal and Regulatory Affairs at Sportradar.

Before debating some of the nuances of legalized sports betting, the panel outlined some of the general legislative history. It is worth noting that, according to the panel, every major sports league in the U.S. has at least one sports betting partnership (the NCAA prohibits gambling on college sports from any of its campus stakeholders; and obviously, for years, professional sports leagues were opposed to legalized sports betting due to perceived integrity issues). The patchwork of state laws has also led to varied regulations, in particular, with respect to betting on college sports (where, for example, college sports has been less regulated in some states). Of course, prior to the 2018 SCOTUS decision, the sports betting market in America was pretty much all illegal except for a few grandfathered exceptions.

In late July of this year, LEAD1 athletic director, Lyke, testified before the U.S. Senate Judiciary Committee on the practical implications of legalized sports betting.  The heart of the webinar, therefore, concentrated on Lyke’s three main points included in her testimony with the rest of the panel responding to her arguments.

Lyke’s first main point is that the introduction of legal wagering on college sports will have a detrimental impact on student-athletes and general student bodies. Lyke described the temptations that student-athletes face due to intense community pressures, which would be exacerbated if wagering takes place.

Stern explained that many of these temptations already exist on college campuses (even prior to legal betting) and therefore the responsibility to educate student-athletes should be on the institutions and betting industry to better inform student-athletes about some of the possible unintended effects. Williams agreed with Lyke noting that because of globalization, such as the ease of using mobile devices to bet, student-athlete well-being is critical, however, stated that the industry can monitor regulated environments to mitigate possible bad actors (for example, Sportradar can determine whether there are irregular betting activities based on its technology).

Second, Lyke argued that student-athletes may be susceptible to corruption and other abuses by gambling interests, which could impact the integrity of college athletics. Other important considerations are the advent of “prop betting” (a bet on an individual occurrence within a game) as well as social media’s impact on student-athlete mental health and well-being (such as messages to and about student-athletes that create further pressures). Walsh recommended that colleges and universities consider utilizing “exclusion lists” that most states have, which allow people to request to be excluded from legalized gambling activities in the state. Specifically, colleges and universities could add their own people, whether student-athletes or staff, for example, to the list.

Third, Lyke highlighted some of the compliance ramifications, stating that the widespread effects of legalized gambling cannot be contained even with the requisite education and rules in place. Lyke also noted some of the extra costs on athletic departments to monitor all betting activities. Stern described that one key mitigation strategy is moving illegal offshore betting to more regulated spaces (noting that the illegal market cannot be regulated). According to Stern, companies like FanDuel and DraftKings are already moving more and more illegal activity into the regulated marketplace.

The panel also discussed the University of Colorado’s recent partnership with “Pointsbet,” an online bookmaker. According to Walsh, these partnerships are “inevitable” so more and more colleges may look to monetize such opportunities.

All in all, more friendly debate, akin to this forum, would better serve college sports on a number of similar critical issues. Stay tuned to LEAD1 for more of this type of dialogue.

 

Download Presentation Slide (via PDF) HERE