Colorado Seeks to Dismiss Tribal Sports Betting Lawsuit in Federal Court

Colorado Governor Jared Polis and Colorado Division of Gaming Director Christopher Schroder have filed a motion to dismiss a federal lawsuit brought by the Southern Ute Indian Tribe and the Ute Mountain Ute Tribe, potentially bringing an end to a high-stakes court battle over tribal sportsbook rights in the state. The outcome of this case could have significant implications for other US states, especially as sports betting continues to expand.

The Debate Revolves Around Sports Betting Rules

The two tribes brought Colorado to court in the US District Court last year, alleging that the state infringed upon their sovereignty by regulating wagers made through their sportsbooks by off-reservation customers. They argue that such bets should legally be treated as if made on tribal land and, therefore, exempt from state gaming taxes and oversight, even if the customer was physically elsewhere.

The tribes argue that because their sportsbook servers are located on tribal land, the bets are technically placed on their land, even if the bettor is not physically present. State officials, however, reject that interpretation. They contend that allowing tribes to offer off-premises wagering to the entire state without legislative approval or compact renegotiation would violate Colorado’s exclusive regulatory authority over non-tribal land.

Governor Polis and state officials add that the lawsuit fails to present a valid legal claim due to constitutional protections, federal precedent, and procedural grounds. Colorado’s legal position relies upon the Eleventh Amendment, which prohibits federal lawsuits against states by private parties, including Native American tribes unless an explicit waiver or exemption applies.

Colorado Officials Firmly Reject the Tribes’ Implications

This newest motion to dismiss argues that the Ex parte Young exception, which allows for legal action to stop ongoing violations of federal law, does not apply because no enforcement action is presently underway against the tribes. The motion further underlines that Colorado officials had repeatedly tried to engage in dialogue with the tribes to resolve this matter in good faith.

Gov. Polis is asking the court to dismiss the case with prejudice, meaning the tribes may not refile. The motion contends that even if the court allowed the tribes to amend their complaint, such a move would be moot given the underlying legal deficiencies. While Polis reaffirmed his commitment to maintaining tribal sovereignty, he was adamant that the lawsuit violated federal and state law.

As of now, the tribes have not formally responded to the motion. However, tribal leaders have previously stated that their lawsuit is about preserving vital revenue streams during the digital age. This case’s outcome could have significant implications for the border US gambling sector, especially as more tribes look to expand their online gaming offerings beyond reservation boundaries.