A federal lawsuit against sportsbook operators in Washington, D.C., challenges the legal validity of the district's sports betting market. DC Gambling Recovery LLC brought the suit, contending the Sports Wagering Lottery Amendment Act (SWLAA), the legislation that legalized sports betting in the capital, is unconstitutional.
Key takeaways
● All five of Washington, D.C.’s sportsbooks were named in the lawsuit.
● Intralot’s monopoly ended in D.C. after being fined $5 million for contract violations.
● The lawsuit alleges D.C. can't legally establish a sports betting market.
Plaintiffs filed suit against BetMGM, Caesars, DraftKings, Fanatics, and FanDuel. All five entered the D.C. sports betting market after Intralot's monopoly fell.
DC Gambling Recovery initially filed the lawsuit in D.C. Superior Court in February but was transferred to the U.S. District Court for the District of Columbia. The change is a typical strategy in civil litigation since federal courts tend to have higher procedural barriers to plaintiffs.
Plaintiffs argue the U.S. Supreme Court’s 2018 decision, which struck down the Professional and Amateur Sports Protection Act (PASPA) and led many states to legalize sports betting, doesn't cover D.C. That ruling was grounded in the Constitution's 10th Amendment, which limits federal power and reserves certain powers to the states.
However, the complaint states D.C., as a federal district and not a state, is not afforded 10th Amendment protections. The complaint also alleges D.C. officials wrongly construed the Supreme Court's decision to interpret PASPA. Attorneys argue that since the 10th Amendment doesn't apply to D.C., the original PASPA prohibitions remain enforceable.
This would render the SWLAA, and by extension, the operations of all current sportsbooks, legally void.
Giving further strength to its case, the lawsuit also invoked the 1710 Statute of Anne, an old law that remains enforceable in the district. Under this statute, gambling debts under $25 aren't enforceable, and unless a gambler recovers these losses within three months, a third party may recover them on his or her behalf.
Millions of dollars at stake
The lawsuit alleges D.C. residents are losing millions of dollars monthly between retail sportsbooks and their online counterparts since Washington D.C. extended the market. The complaint presents these losses as a growing public health crisis, with vulnerable and young people particularly affected.
This court battle adds another level of controversy to the already complicated D.C. sports betting launch. When the SWLAA passed, the district awarded Intralot a monopoly contract, and critics soon questioned its vendor selection for both performance and contractual compliance.
Intralot's tenure ended in scandal, capped by a $5 million fine the D.C. Council levied in Jan. 2025 for breach of contract. That twist of fate led to the five sportsbooks operating in the district, each named in the current suit.
None of the named sportsbook operators have yet to comment publicly on the pending litigation. The U.S. District Court must determine whether it has proper jurisdiction before it can hold substantive hearings on the case's underlying constitutional and statutory issues.
The plaintiffs seek damages for all customer losses in excess of $25 and demand triple damages.
