Report Alleges Michigan Lawmakers Were Enticed To Include Official Data Mandate For Legal Sportsbooks

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Written By Derek Helling on January 25, 2020
Article Links Official Data Mandate to Lawmakers' Florida Trip

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The future Michigan legal sportsbooks could potentially exemplify the influence of the “golden rule” – the notion that those in possession of wealth have the authority to establish rules and regulations.

According to a report published by The Athletic, three legislators from Michigan were allegedly treated to an extravagant trip to a golf course in Florida, where they met with representatives from MLB, NBA, and PGA. Interestingly, several months following this trip, the state passed a law mandating legal sportsbooks in Michigan to purchase “official” data exclusively from these leagues.

What is an official data mandate, and why does it matter?

Instead of employing staff to monitor the games they offer action on, sportsbook operators depend on external companies to supply the necessary information.

This encompasses not just the outcome of games but also the consequences of individual actions within those competitions. Numerous vendors are involved in this field.

Sportradar is one such company that has entered into financial agreements with professional sports leagues, like the NBA, to secure its status as the official provider.

Many states have seen debates among leagues, advocating for legislation that would require legal sportsbooks to exclusively obtain data from their official partners. They argue that using “unofficial” sources is unreliable and that it motivates leagues to ensure their data partners comply with league standards.

Although some states have not agreed to this request, Michigan has complied. The recently implemented law in Michigan states that sportsbooks must obtain their information for in-game wagers from official sources, unless they can demonstrate that the expenses associated with doing so are commercially impractical.

If the recently emerged report is indeed accurate, the manner in which this mandate came into effect becomes evident. The allegations strongly suggest a quid pro quo arrangement.

What The Athletic report alleges and who is involved

Last February, Michigan House Speaker Lee Chatfield, Rep. Brandt Iden, and Rep. Jim Lilly journeyed to TPC Sawgrass in Florida for a meeting with MLB, the NBA, and the PGA, as stated in the report.

The lawmakers acknowledge having met with those representatives during that period. However, they do contest the claim that the leagues covered their lodging expenses.

According to The Athletic article, the leagues covered the expenses for food and drink, amounting to $260 per person. However, Chatfield, Iden, and Lilly claimed that they personally covered their own costs for flights and lodging.

Although $260 may seem insignificant compared to the substantial amounts of money that the leagues have invested in lobbyists for this purpose, the actual monetary value is not the key factor. What truly matters is the significant influence that these individuals possessed.

Why this is an issue for the Wolverine State going forward

If the allegations prove to be true, it raises concerns about the integrity of these three influential lawmakers involved in the process of legalizing sports betting. The fact that they received complimentary meals from the parties who had the most to benefit from including this specific provision in the law creates a negative perception. It prompts us to question whether this requirement would have been included in the law if it weren’t for the alleged act of bribery.

However, there is a larger concern at hand: the law also eliminated a previous statute that prohibited gambling companies from making direct contributions to political causes.

If it is indeed true that lawmakers such as Chatfield, Iden, and Lilly can be influenced by gambling interests for a mere $260 in beverages and meals, one can only wonder what the impact would be of thousands of dollars directed towards their reelection campaigns. Pursuing this line of thinking inevitably leads to a disconcerting scenario.

It remains uncertain whether the state will conduct an investigation, but regardless of that, the mandate presents significant issues.

There is no evidence to suggest that “official” data holds any advantage over “unofficial” information. Both “official” and competing companies employ identical methods for data collection and reporting.

The sole distinction lies in the contractual agreement between these companies and the leagues, demonstrating how the principle of the golden rule can frequently supersede legal regulations.

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