According to the June bill, state law restricts sports betting in areas “other than the land contained within the racecourse oval.”
A lawsuit filed by the owners of Cherry Hill racetrack in New Jersey is designed to clear the way for a legal land-based sportsbook on the site. The lawsuit is aimed at a Philadelphia area casino operator. Cherry Hill sits across the Delaware River from Philadelphia.
The plaintiffs claim GS Park Racing declined to open a sportsbook on the site to avoid competition, but the failure to do so damages Garden State Park‘s owners, local sports bettors, and the state of New Jersey.
Cherry Hill Towne Center Partners is the real estate development company based in Piscataway which owns all but 10 acres of the 600-acre Cherry Hill racetrack. Cherry Hill Towne Center Partners has a deal in place with GS Park Racing that gives the gaming company exclusive rights to open a sportsbook on the racetrack’s grounds.
GS Park Racing is partnership of several gaming operators. One of the partners is Greenwood Racing, which owns or co-owns Parx Casino, Philadelphia Park, and Freehold Raceway.
Cherry Hill v. Greenwood Racing Lawuit
The lawsuit alleges that Greenwood Racing has deliberately not opened a legal sportsbook on the Cherry Hill site, because they are concerned about the site cannabilizing business at its Philadelphia area gaming operations.
In failing to open a sportsbook, Cherry Hill Towne Center Partners alleges Greenwood Racing and its partners have done material damage to the closed Cherry Hill racetrack and themselves. In effect, they have damaged the value of the property.
Cherry Hill Towne Center wants to invalidate the deed covenant. If they succeed, the group would be able to open up an off-track betting facility at the complex. That might allow the partners to open an online sportsbook or launch a mobile sports betting app in the New Jersey gaming sector, as well.
Unenforceable and Invalid Contract
Lawyers for the plaintiffs claim the deed covenant is unenforceable and “invalid”, because it has no end terms. The plaintiffs also claim they have the right to launch a sportsbook, because the original contract did not anticipate that being a part of the gaming operations discussed in the original negotiations.
In the words of the suit, the Cherry Hill Towne Center Partners “could not have been contemplated” their racetrack might one day have the legal right to open a sports wagering facility there. They claim the deed covenant only covers traditional racebook gaming facilities.
Definition of a Former Racetrack
The filing states, “The definition of a ‘former racetrack’ in the New Jersey Sports Wagering Act limiting its scope solely to ‘the land contained within the racecourse oval’ is unconstitutional and denies answering defendants their right to due process of law.”
The suit further notes that Garden State Park, originally located on the grounds at Cherry Hill, is one of only 5 racetracks in the state of New Jersey which allows sportsbook betting. The other four locations are Meadowlands Racing and Entertainment, Monmouth Park Racetrack, Atlantic City Race Course, and Freehold Raceway. Of those, none are within 48 miles of the Garden State Park facility.
Which NJ Gaming Facilities Have Sportsbooks?
Under New Jersey gaming law, only licensed land-based casinos and racetracks can launch land-based sportsbooks or online gambling portals. The nine Atlantic City casinos and the five racetracks around the state are thus the only possible venues for sports betting — making the Garden State Park facility a valuable asset.
Lawyers for the plaintiffs argue that Greenwood Racing is deliberately sabotaging the property for its own bottom line.
The lawsuit goes further. Besides depriving local residents of the chance to bet at a local sportsbook instead of making an hour and a half round trip to the nearest facility, it says that Greenwood Racing is depriving the state of New Jersey of tax revenues. Since June 2018, the state of New Jersey has legal, licensed, regulated, and taxed sports betting.
John Burzichelli on Garden State Park
Roberto Rivera-Soto, a lawyer for Greenwood Racing and its partners, declined to comment directly on the lawsuit. One New Jersey lawmaker expects Greenwood Racing will argue in court that Garden State Park was never intended to be used as a sports betting facility, due to vague wording in the 2018 sports betting law.
New Jersey State Assemblyman John Burzichelli (D-Paulsboro), one of the sponsors of the sports betting bill, said lawmakers definitely intended Garden State Park to be included in the sportsbook community.
Burzichelli said some months ago, “If there is a technical error on how a former racetrack is defined we would need to do some housing keeping. The intention was to protect the lower backdoor of the state and the former Garden State site is intended for that. It’s an outpost to guard against an outflow of economy.”
