By Michael Alley


On May 14, 2018, the gambling world changed forever. On this date, the United States Supreme Court decided the landmark case Murphy v. National Collegiate Athletic Association.[1] This decision limited the federal government’s ability to regulate gambling that occurs in the states.[2]  In this case, New Jersey, along with Governor Phil Murphy, successfully challenged the constitutionality of the Professional and Amateur Sports Protection Act (PASPA), which prohibited states from allowing sports gambling.[3] The court found that PASPA violated the anti-commandeering doctrine because the federal government is explicitly directing states on the laws they may or may not pass.[4] Furthermore, it violates state sovereignty, and Congress must allow the states to regulate gambling as an intrastate activity.[5]

The impact of this decision has been felt immediately. Currently, roughly 30 states have some online gambling, with nearly 20 states allowing an online option.[6] Some states restrict it to tribal grounds while others allow it statewide.  In some states, such as Florida, battles rage between lawmakers and Native American tribal leaders on the effect of online gambling, where the Tribe will undoubtedly lose tourism and gambling dollars if more competition is introduced.[7]

The competition is fierce, with New York set to bring in the most revenue.[8]  New York has a tax rate of 51% and is set to collect just shy of $250 million in revenue for 2022.[9] However, online gambling is a unique issue.  Due to evolving technological advances, people have attempted to gamble through Virtual Private Networks (VPNs).[10] VPNs will hide a user’s IP Address and location, tricking a gambling platform into thinking the person is in a permitted geographical area to gamble when they are not.[11]  It can allow a person in a state where sports gambling is illegal to place a bet as if they are in another state where sports gambling is permitted.[12] Although gambling platforms have done a good job at blocking the popular VPN networks,[13] as the technology advances, there is no guarantee that the success will continue.

Furthermore, people are more interconnected with people in other areas of the country. Although the Fifth Circuit Court of Appeals held that the WIRE Act applied to sports gambling,[14] people in states where sports gambling is outlawed can gamble through proxies in states where sports gambling is legal.[15]  This blurs the line of whether online gambling can be limited to just intrastate commerce. It raises the question of if congress could try to act again in the future to curb sports gambling. States where gambling is illegal still have a populace that engages in the practice yet are not gaining any benefits such as an increase in tax revenue or jobs.

Gambling companies such as DraftKings and FanDuel have achieved massive success and must focus on this issue. If they don’t limit gambling across state lines, it opens these companies to the mercy of federal government regulation. Congress may renew an argument that online gambling in its current form must be interstate commerce and can be regulated federally, either by the WIRE Act or other means.



[1] Murphy v. National Collegiate Athletic Ass’n., 138 S.Ct. 1461 (Westlaw 2018).

[2] Id. at 1485.

[3] Id.

[4] Id. at 1481.

[5] Murphy v. National Collegiate Athletic Ass’n., 138 S.Ct. 1461, 1478.

[6] Sam McQuillan, Where is Sports Betting Legal? Projections for all 50 states, Action Network (Sept. 14, 2022, 9:08 AM),

[7] See Daniel Wallach, Feds, Seminole Tribe Invoke IGRA ‘Jurisdiction—Shifting’ In Bid To Revive Online Sports Betting in Florida, Forbes (Sept. 29, 2022, 4:16 PM),

[8] Justin Byers, New York’s Sports Betting Tax Revenue Hits Record High, Front Office Sports, (July 11, 2022, 5:14 AM),

[9] Id.

[10] See Robert A, Cronkleton, How many Missourians tried to gamble in Kansas on first day of legal sports betting?, The Kansas City Star, (Sept. 2, 2022, 12:49 PM), (explaining how Kansas blocked 16,000 attempts by gamblers who were illegally trying to gamble from Missouri).

[11] Dalvin Brown, When to Use a VPN–and When IT Won’t Protect Your Data, The Wall Street Journal, (Sept. 6, 2022, 10:00 AM), (explaining how VPNs can mask location).

[12] See id.

[13] See Cronkleton, supra note 10.

[14] Aalok Sharma, The First Circuit Rules that the Wire Act Applies to Sports Betting Only, JDSUPRA (May 6, 2021), (explaining how the First Circuit Court of Appeals found that the WIRE Act prohibited interstate sports gambling).

[15] See id.

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