In all of the Massachusetts Gaming Commission’s adjudicatory hearings related to the launch of sports betting up until now, the operators have appeared, acknowledged the error and provided a plan for how the error would be avoided in the future.
That was not the case on Wednesday when attorney and free speech specialist Jonathan Albano appeared as Penn Entertainment’s counsel and argued that the Can’t Lose Parlay promotion offered by its online sportsbook Barstool Sportsbook was not in violation of state gaming regulations because no reasonable person could possibly conclude that the bet could not lose. While Penn did use the hearing to defend its position that it did not violate the gaming regulation, it did offer to terminate Can’t Lose Parlays on a permanent basis going forward and put that pledge in writing.
The MGC investigated the promotion and whether or not it runs afoul of the regulation expressly prohibiting the use of language implying there is no risk to wagering as well as a regulation limiting sportsbooks from explicitly promoting specific wagers to customers.
Penn used hearing to defend Can’t Lose Parlay as compliant
“Our position, of course, is that, as a matter of state law and constitutional law, there was no regulatory violation,” Albano stated upfront.
“The commission has to analyze the documents, the Can’t Lose Parlay name, in context, through the eyes of a reasonable consumer. We respectfully submit that no reasonable person who saw a parlay with long-shot odds that required a player to win not one, not two, not three, but four or lose the parlay would have concluded that they were engaging in a risk-free sort of bet,” Albano stated.
As Penn has argued in the past, Dan Katz (aka Barstool Big Cat) has developed a persona that includes being an unsuccessful sports bettor and it is apparent to the Barstool audience that the “Can’t Lose” moniker is satirical and tongue-in-cheek.
Albano compared the Can’t Lose Parlay to buffalo wings or Crunch Berries cereal where a reasonable person understands the Crunch Berries are not actually berries and buffalo wings do not actually contain buffalo meat (Ed.note: Buffalo wings are named as such because they were first popularized in Buffalo, NY).
Albano also noted that this promotion has been offered in 15 other jurisdictions without issue, though many of those states do not explicitly have regulations surrounding “risk-free” language as Massachusetts does.
Commissioners questioned the idea of a reasonable MA sports bettor
The group of five MGC commissioners questioned the argument from a variety of angles. Commissioner Eileen O’Brien questioned the social media data Penn submitted about social media indicating fans understood the satire needed to be taken with a grain of salt, as she suggested those who didn’t understand it would arguably not share their confusion on social media so readily.
Albano also introduced evidence that, of the more than 122,000 Can’t Lose Parlay players, 55% were repeat bettors and 90% had lost the first time around.
“That, I would suggest, is compelling evidence that betters who had hypothetically thought that this was a sure thing, surely 90% of them would not have come back for a repeat bet,” Albano argued.
“So, another way to look at that Attorney Albano, was those people are chasing losses, and so to be blunt, I’m not overly persuaded by that piece of information,” O’Brien replied.
Both Commissioner Jordan Maynard and Commissioner Nakisha Skinner questioned Albano about his reasonable standard, arguing that someone absolutely brand new to sports betting would not have the knowledge to interpret the moneyline odds or to understand the likelihood of four separate events all happening in a given time period.
Maynard argued the more responsible method might be for Big Cat to put out the play on social and then allow users to assemble to parlay within the app themselves as opposed to a pre-populated wager. Skinner posed the following question:
“Let’s say I download the app. I’m curious about what this Barstool Exclusive Tab is. I see the Can’t Lose Parlay advertised. I’m not looking at the odds, because I’m not fully informed as to sports wagering. What would inform a reasonable mind in that instance? What would tell me as a better that I’m more likely to lose that Can’t Lose Parlay than win it?”
Albano said the terms of the wager, including the separate legs and the moneyline odds, and user education tools like a page explaining how parlays work would lead any reasonable person to conclude the likelihood of winning is slim.
Commissioner Bradford Hill acknowledged his status as the only commissioner who is not an attorney, but voiced similar frustrations with the reasonable person standard.
He said pointing to Katz’s history of making these wagers under the Can’t Lose Parlay name dating back to 2019 isn’t applicable to Massachusetts, which only launched regulated sports betting this year.
“So I need somebody to understand, help me understand what is a risk reasonable consumer when it comes to this new industry? Because I believe that yes, there are a majority who would know that this is a joke,” he said.
He referenced Charles Barkley without expressly naming him and his wagers around the NBA Playoffs and noted that he put his bets out there and many know he is not a successful bettor but that some people might have placed those bets not knowing any better.
Penn argues promotion is constitutionally protected speech
Albano repeatedly went back to the law, noting that the MGC, “can’t start a different speech regulation regime.”
“I did not and I do not represent that a promotion can say anything and slide by your regulations. I am saying. I don’t know if it’s a representation, it’s my honest read of case law, that there aren’t magic words that end the analysis. As I understand the case law to say one must go further and look at the context,” he added.
When pressed to directly defend how Penn did not violate the specific regulation about risk-free language, Albano again defaulted to context. Even with commercial speech having fewer protections than something like political speech, he said it is still constitutionally protected.
After two hours of debate, the commissioners adjourned. Like the other adjudicatory hearings related to sports betting, Penn will have to wait a while to get a written conclusion, including any potential penalties or fines related to the incident.
