Tilman Fertitta is a man that wears many hats. He doesn’t just own casinos, but he also owns a professional basketball team. However, he’s been having problems in New Jersey.
Fertitta is the owner of the Houston Rockets basketball team. He has every reason to be happy with them at the moment as they top the Southwest division of the NBA’s Eastern Conference. His busy life also sees him own the Golden Nugget casinos situated in Nevada, Mississippi, Louisiana and New Jersey.
Last year, there was a major ruling by the US Supreme Court that changed the face of sports betting in the USA. The ruling declared that it was now up to individual states to decide if gambling was to be legalised in their state, rather than it being a Federal decision.
The ruling led to many states legalising sports betting and several casinos have opened their own sportsbooks. That’s just what Fertitta has done and his customers can now go to his online casino and place bets on top sporting action. There is one restriction of course that applies to his casinos. It’s not possible to take bets on the Houston Rockets.
With a successful basketball team and several profitable casinos, you’d imagine that he would be a happy man indeed. However, he is claiming that owning casinos and being a basketball club owner is in fact hurting his casino business, particularly in New Jersey.
He had accepted the fact that his casinos couldn’t offer customers the chance to bet on games involving the Houston Rockets. However, the state of New Jersey ruled that the one he owns in their state cannot take any bets at all on the NBA.
This was a decision that Florida attorney Daniel Wallach who is an expert on sports law, described as a “disproportionate response” that had a major affect on how the Golden Nugget’s sports betting has been performing.
The ban on his New Jersey casino taking any bets on the NBA had been described by Fertitta himself as a “horrible setback.” Basketball is one of the most popular sports in the USA. With the NFL season ending in January, the inability to bet on basketball was a disaster for his sports book. Customers went to his site and there was no NFL to bet on and no basketball either. “It made us just kind of hide in a shell ourselves and not really do major marketing because we just didn’t think it was going to be worth it.”
Gamblers tend to place their bets with one online casino. Being unable to make wagers on the NBA led them to go elsewhere. Steve Scheinthal, general counsel for the Golden Nugget’s parent company, Houston-based Landry’s Inc. said that the ban “was like going into a boxing ring with one arm tied behind your back. You just can’t compete that way. It gave everyone a year’s head start on us.”
This ban lasted for a year and a half until last week. Finally, a new bill was signed by the state’s Democratic governor, Phil Murphy, that now allows his New Jersey casino to take NBA bets but not on the Houston Rockets of course.
This Texas billionaire really is a jack of all trades. In addition to his casinos and basketball team, he is the sole owner of restaurant corporation Landry’s Inc. and the star of the ‘Billion Dollar Buyer TV show. Last year, Forbes estimated his net worth at $4.5bn putting him at number 153 in the Forbes 400 list of the wealthiest Americans. He’s also an author and writes about his business philosophies in his new book ‘‘Shut Up and Listen.’ This includes ‘know what you know and know what you don’t know.”
The current success for the Houston Rockets is important for Mr Fertitta. There’s plenty of money at stake in the NBA, far more than in the sports betting business. The latter is important but only supplies a small amount of overall gaming revenue.
It also puts him in an interesting position in the discussion over whether gambling companies should make payments to the top leagues that their customers place bets on. This is the ‘integrity fees’ argument that has raged for a lot time. It was especially prevalent when there was the ongoing battle to legalise sports betting. The leagues believe such payments would ensure that the games played are above board.
As the battle to legalise sports betting in the USA raged on, the main sports leagues were continually opposing such a move. Not one of the four major professional sports leagues in the USA (NFL, NBA, MBL and NHL) have managed to get any “integrity fees” paid to them. There were attempts in the state of Indiana to introduce a 1% “integrity fee” to be paid by sports books. This didn’t become law though and other states including New Jersey have passed legislation that excludes “integrity fees.”
Perhaps not surprisingly, Fertitta can see both sides of the argument. He can see why the NBA might want some payment because it is supplying content for the bookmakers. On the flip side, though he can see why the casinos don’t believe payments should be made. “It’s kind of like streaming music, you know? The artist wants some of it and other people say they don’t deserve any of it. I don’t think it’ll ever be mandatory; I think it will be more partnership-based,” said the casino and basketball team owner.
There is some finance heading in the way of the major leagues. There have been partnership deals signed between the gambling industry and sports teams. For example, the NFL have a partnership with the sports data company, Sportradar. This enables them to exclusively sell official NFL data to casinos and sports book worldwide.
The NBA ban hit the Golden Nugget hard. His Houston Rockets team may be topping their NBA division but Fertitta’s casino is struggling in the sports book table. Of the nine casinos in Atlantic City, all but one of them have a sports book.
Up until the end of August 2019, the Golden Nugget Casino has earned $983,960 from sports betting. That places it only sixth in the earning table. That’s compared to its second place behind the Borgata Casino when it comes to overall gambling revenue with a total of $246m. Now it’s time for his casino to play catch-up and the Rockets to keep their lead at the top of their division.