The restriction of U.S. Sports Betting Advertising and First Amendment rights

In the half decade since the U.S. Supreme Court permitted the legalization of sports betting,[1] about three dozen states enacted laws permitting this activity.[2] In those jurisdictions, gaming companies have not been shy about advertising and promoting their services. As a result, these sports betting firms have been flooding various media with advertisements, estimated at about $2 billion last year.[3]

The media saturation – coupled with relatively weak regulations in most of the states that have legalized sports betting[4] – has fueled concerns about increases in problem gambling and gambling addiction. It is estimated that eight million U.S. adults are problem gamblers.[5] With the advent of sports betting, especially online betting, the problem may well be more acute. In a 2019 study, the National Council of Problem Gambling reports that the rate of problem gambling among sports bettors is at least twice as high as among gamblers in general.[6] When sports gambling is conducted online, the rate is even higher, with one study of online sports gamblers indicating that 16% met clinical criteria for gambling disorder and another 13% showed some signs of gambling problems.[7] The study noted that those under 18 are at a higher risk, with data from 2018 showing that more than 75% of students gambled and more than 13% of adolescents wagered money on sports teams.[8] Being male and young are considered risk factors for problem gambling.[9] More recently, calls to the National Problem Gambling Hotline increased 124 percent to over 30,000 between March 2020 and March 2023.[10]

Indeed, there is evidence that problem betting and addiction is increasing. Inquiries to the Council on Compulsive Gambling of New Jersey's help hotline about sports gambling have increased 60 percent since it became legal in the state in 2018,[11] and in Colorado, the number of calls and texts to Colorado’s Gambling addiction helpline increased by 45 percent in the first year after sports betting was legalized.[12]

State legislatures and regulatory bodies have enacted restrictions on what they consider “false and deceptive” advertising and have mandated certain required content on advertising and promotional materials such as phone numbers and other information for those with gambling issues.[13] New Jersey’s revised regulations – adopted in April 2023 – are among the most encompassing. They include: requiring a phone number to call aimed at problem gamblers be prominently displayed; prohibiting promises of “guaranteed wins” or “risk-free” bets, particularly when patrons are required to deposit their own funds into a wagering account and are unable to be fully compensated for the loss of their funds; mandating the use of “responsible gaming language” in advertisements; banning “unrealistic promotions;” and barring advertisements placements where the primary demographic is underage viewers.[14]

Yet, these regulations have not appeased those who wish a broader-brush restriction on sports betting advertising. One representative in Congress introduced a bill that would ban all electronic advertising of sportsbooks “on any medium of electronic communication subject to the jurisdiction of the [Federal Communications Commission].”[15] The representative argued that a similar ban on tobacco advertising, enacted over half a century ago, would be a precedent for a similar ban on sports gambling.[16] While the author is sympathetic to the idea, there are significant constitutional challenges before such a ban could be enacted today. [17] It may not be impossible to do, but it would be challenging to justify. However, there are broader restrictions that the author believes could pass constitutional muster and should be considered on a state or national level. These issues will be addressed in this article.

Specifically, this article will examine:

• The evolution of commercial speech in the United States
• The First Amendment test found in the 1980 Central Hudson case
• How different countries treat gambling advertising restrictions
• How certain broader restrictions could pass constitutional muster