Attorneys for the state of Colorado say a lawsuit from the Southern Ute and Ute Mountain Ute Tribes over sports betting regulation should be dismissed, in part because the state officials named in the suit are immune from such claims.
Earlier this summer, the Southern Ute Indian Tribe sued Colorado in federal court, saying that the state improperly sought to regulate their entry into sports betting. The Ute Mountain Ute Tribe later signed onto the lawsuit. Online sports betting was narrowly approved by Colorado voters in 2019.
The tribes asserted that bets through their sportsbook by people not on Tribal lands should be treated as though they were placed on the Southern Ute Reservation, and therefore not subject to Colorado’s sports gaming taxes.
In a 17-page court filing submitted Tuesday, attorneys for the state asked the court to dismiss the claim.
“The Tribes’ position is substantively incorrect,” the court filing says. “However, this Court need not address the merits of this case because it lacks subject matter jurisdiction over the Tribes’ claims and the Tribes fail to state a claim.”
The state’s rationale included that Governor Jared Polis and Christopher Schroder, the director of the Colorado Division of Gaming, were entitled to Eleventh Amendment privileges. The Eleventh Amendment restricts claims brought against states or state officials in federal courts. The claim specifically points to a 1996 Supreme Court Ruling involving the Seminole Tribe of Florida, which held that Eleventh Amendment protections extended to claims made by a tribal government and that Congress could not waive such protections in those cases.
The filing further argues that an exception to the immunity cannot be granted because case law upholds states’ sovereign interests.
“As the Tribes argue that they have a sovereignty interest in their right to control gaming on Indian lands, so too does the State possess a sovereignty interest in the ability to regulate sports betting in Colorado,” the motion to dismiss says.
Colorado also argues that the tribes have failed to make a proper claim and that their filing does not align with the conditions required to seek relief under the Indian Gaming Regulatory Act, which governs tribal gaming.
In their original complaint, the Southern Utes argued that the state stymied their efforts to launch a sportsbook, including by contacting gaming vendors the tribe was working with to warn them that some actions could violate state laws.
The state disagreed, saying that the communications reflected an effort to “engage in meaningful dialogue with the Tribes to avoid any such conflict.” The state further argues that the tribe’s online sports betting efforts were never actually restricted.
“Rather, the claims amount to a disagreement between the State and the Tribes as to which government may lawfully regulate the Tribes’ off-Reservation sports betting activity. At this point, that question is purely theoretical. The Southern Ute Indian Tribe by its own admission voluntarily closed its Sky Ute SportsBook Betting Enterprise in July 2023,” the motion says.
Lastly, the state argued that the claim fell outside of the statute of limitations. Attorneys for the state of Colorado say that because the Indian Gaming Regulatory Act does not include a statute of limitations, Colorado law should apply, and that the Tribe’s filing comes outside of both the two and three-year window that could potentially apply.
According to the Colorado Department of Revenue, more than $370 million worth of sports betting wagers were placed in Colorado in August.
