Justice Samuel Alito Jr. Credit: Diego M. Radzinschi / ALM

The U.S. Supreme Court on Monday struck down the 1992 federal law that bans most states from licensing sports betting, opening the door to legalized sports gambling nationwide.

The decision could transform sports and sports gambling from coast to coast. It is currently a mostly illegal activity that, according to the American Gaming Association, “has grown to a $150 billion-a-year industry.”

Responding to the court's ruling Monday, the association issued this statement: “Today's decision is a victory for the millions of Americans who seek to bet on sports in a safe and regulated manner … Through smart, efficient regulation this new market will protect consumers, preserve the integrity of the games we love, empower law enforcement to fight illegal gambling, and generate new revenue for states, sporting bodies, broadcasters and many others.”

By a 6-3 vote in Murphy v. National Collegiate Athletic Association, the justices found that the 1992 Professional and Amateur Sports Protection Act, or PASPA, infringed on state sovereignty in violation of the Tenth Amendment and amounted to “commandeering” states to do the federal government's bidding.

Writing for the majority, Justice Samuel Alito Jr. said the law “unequivocally dictates what a state legislature may or may not do … State legislatures are put under the direct control of Congress. It is as if federal officers were installed in state legislative chambers and were armed with the authority to stop legislators from voting on any offending proposals. A more direct affront to state sovereignty is not easy to imagine.”

Alito, a former U.S. attorney in New Jersey and judge on the U.S. Court of Appeals for the Third Circuit, also wrote, “The legalization of sports gambling requires an important policy choice, but the choice is not ours to make. Congress can regulate sports gambling directly, but if it elects not to do so, each State is free to act on its own. Our job is to interpret the law Congress has enacted and decide whether it is consistent with the Constitution. PASPA is not.”

Justices Ruth Bader Ginsburg, Stephen Breyer Sonia Sotomayor dissented in part or in full.

“The court wields an ax to cut down §3702 instead of using a scalpel to trim the statute. It does so apparently in the mistaken assumption that private sports-gambling schemes would become lawful in the wake of its decision,” Ginsburg wrote.

The decision could also change the dynamics of other areas of state-federal conflict such as legalization of marijuana and physician-assisted suicide.

In spite of the federal law, New Jersey voters in 2011 approved sports betting as a way of reviving the state's casinos and racetracks. Then-Governor Chris Christie defiantly challenged the federal government to “try to stop us,” setting the stage for the case decided Tuesday.

Major sports leagues led by the National Collegiate Athletic Association sued New Jersey, and the federal law was upheld at both the district court and appeals court levels.

During argument in December, Christie's lawyer Theodore Olson of Gibson, Dunn & Crutcher acknowledged that the federal government may preempt state activities like allowing sports gambling under its powers to regulate commerce, but only when it actually imposes a comprehensive regulatory scheme of its own that would make state actions inconsistent.

“PASPA is a direct command to the states without any effort to regulate sports wagering,” Olson told the justices. He added that the federal government wanted to “put the burden and expense and accountability all on the states.”

Paul Clement of Kirkland & Ellis defended the law on behalf of the National Football League, National Basketball Association, Major League Baseball, the National Hockey League and the National Collegiate Athletic Association.

Deputy U.S. Solicitor General Jeffrey Wall also defended the law, telling the court that Olson's assertion that federal law can pre-empt state law only when the federal government promulgates a comprehensive regulatory scheme is “a made-up principle.”

The Supreme Court ruling in Murphy v. National Collegiate Athletic Association is posted below:

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