With a finding of “no reversible error,” the Arizona Court of Appeals, Division One agreed with a lower state court, which had affirmed a departmental decision to deny TP Racing’s application for an event wagering operator license in that state.
By way of background, the appeals court noted that in April 2021 the Arizona legislature enacted the Event Wagering Act, A.R.S. §§ 5-1301 through 5-1321. The Act authorizes the Arizona Department of Gambling to issue up to ten event wagering operator licenses to non-Indian tribe applicants, A.R.S. § 5-1304(A). Such applicants must be either the “owner of an Arizona professional sports team or franchise,” the operator of a sports facility that hosts an annual PGA Tour event, the promotor of a NASCAR race held in Arizona, or the owner’s, operator’s, or promoter’s designee, A.R.S. §5-1304(A)(1).
Approval is significant since the Act allows the licensee to accept wagers on sports or other events, A.R.S. § 5-1301(4)(a).
In August 2021, TP Racing applied for an event wagering operator license. In its application, TP Racing asserted that it owns a professional sports franchise because it owns the horseracing venue, Turf Paradise. It relied partly on the Department’s website, which states that in 1956, “Turf Paradise opened its doors becoming one of Arizona’s first sports franchises.” However, the application was denied.
TP Racing appealed, seeking judicial intervention.
In its order, the superior court found that TP Racing failed to establish that horseracing is a professional sport because TP Racing does not race its horses or participate in organizational play. This court also concluded that TP Racing does not own a professional sports team or franchise because a sports franchise is either the team or the right to field a team, neither of which TP Racing owns. As a result, this court affirmed the Department’s denial of TP Racing’s application.
Following this decision, TP Racing filed yet another appeal.
The appeals court noted that TP Racing “must show that it is the ‘owner of an Arizona professional sports team or franchise.’ Because TP Racing does not claim to own a team, our analysis hinges on whether it owns a professional sports franchise.”
TP Racing’s two arguments on appeal were that (1) Turf Paradise was a professional sports franchise because the Department has long called it such on its website, and (2) TP Racing’s ownership of a horseracing permit means that it owns a professional sports franchise “because the right to conduct commercial horseracing cannot be exercised without express permission from the State.”
TP Racing’s first argument rested primarily on its contention that a website blurb about the history of horseracing in Arizona was sufficient to confer such a designation. Nevertheless, the appeals court concluded that “the online statement is not relevant to our statutory interpretation.”
In its second argument, TP Racing maintained that, as relevant to A.R.S. § 5-1304(A)(1), a franchise is an exclusive right granted by the State, such as its permit to conduct racing meetings. The appeals court was also unmoved by this argument.
“To be eligible for licensure under A.R.S. § 5-1304(A)(1), TP Racing would have to show that it is the owner of a professional sports team or the right to field a team,” wrote the appeals court. “It does not claim either. Because we conclude that TP Racing is ineligible for an event wagering operator license on this ground, we need not decide whether horseracing is a professional sport. See Progressive Specialty Ins. Co. v. Farmers Ins. Co., 143 Ariz. 547, 548 (App. 1985).”
Once more, the denial of TP racing’s application for a sports betting license was upheld.
T. P. Racing, L.L.L.P. v. Arizona Department of Gaming, et al., Ct. App. Arizona; No. 1 CA-CV 22-0224; 12/14/22
