An adjudicatory hearing with the Massachusetts Gaming Commission (MGC) reflects the growing pains that comes not just with the sports betting industry and its relationship to the media but also Penn Entertainment’s plans to increasingly blend and blur the lines between ESPN and ESPN Bet.
Hearing over Rece Davis “risk-free” comment
The subject of the hearing was the off-handed remark by ESPN personality Rece Davis in March 2024 in which he stated gambling using picks from colleague Erin Dolan was a “risk-free investment”. Later that year, the MGC commissioners agreed the comment warranted an investigation, as it appeared to be a violation of the state’s regulations that prohibit adveritisng using the term “risk-free”.
During the hearing, MGC counsel presented numerous pieces of video evidence including the clip in question and a subsequent appearance by Davis on the ESPN program “The Pat McAfee Show” where Davis clarified he never apologized. During the interview, McAfee also suggested that, “there are some regulators that are gonna hold this against you.”
Multiple commissioners “disappointed” with Davis
That remark in particular did not sit well with Chairman Jordan Maynard, who asked Penn Chief Compliance Officer Chris Soriano if he agreed with McAfee’s statement.
“I won’t speak on behalf of Mr. McAfee, obviously, but I’ can’ll speak on behalf of myself. I think the comment called attention to the importance of compliance. The context to think about there is understanding that in the regulated gaming space that statements that result in a violation will be ‘used against you’ in that context will be evidence of a non-compliance situation. I think that’s actually an important concept,” Soriano noted.
“I think there’s some mystery perhaps among the general public sometimes about how regulated the gaming industry is and what the exepctations are. That concept that the regulated industry is important and that the regulators are watching is one worth exploring.”
Commissioner Eileen O’Brien took issue with Davis making a point of stating he was not apologizing, simply clarifying, and called the response “disappointing”. Commissioner Paul Brodeur also said he was “disappointed” at the way Davis handled the aftermath of the incident, which Brodeur referred to as a”slam dunk” violation of the regulations. He did, however, applaud that an ESPN producer quickly flagged the issue, which was self-reported to the MGC by Penn in short order.
Continued MGC concerns about blending ESPN and ESPN Bet
O’Brien also had several questions related to something she has expressed concerns over since ESPN and Penn began their partnership, namely that the lines are potentially too blurred about where ESPN stops and ESPN Bet begins.
Soriano admitted to O’Brien that, with the breadth of the ESPN portfolio, it is impossible for Penn to monitor every piece of content in real time, but there are robust teams within both groups communicating back and forth about gaming-related content.
“With the launch of this partnership there was a lot of talk about eliminating the friction between the ESPN experience and the betting experience, which I get from a business point of view. But practically speaking and I think RG speaking, there should be some level of friction and there should be some level of separation.”
Soriano said he would be happy to discuss that topic more with the regulators in the future. In his testimony he did point out that the lines are blurring throughout the sports media industry as opposed to an issue unique to ESPN and Penn.
Hearing comes amid new rewards program launch
While the consensus was it was clear Penn violated statute, the commission has not yet determined the penalty for the infraction.
The timing of the hearing coincides with the release of a new player rewards program for ESPN Bet users called Mint Club. The rewards program is eligible for those who have synced their ESPN and ESPN Bet accounts, something that his been touted as a major part of the brand integration element of the partnership.
