The Arete Group is suing the Montana Lottery over the rule that to get a sports betting license, one would also need a liquor license.

  • The state of Montana legalized sports betting in May 2019, estimating it to bring in $4 million in revenue annually.
  • The Montana Lottery was made the legal regulator of the market, allowing them to come up with the final rules and regulations.
  • The Lottery is now being sued due to its rule that any business that seeks a sports betting license must also have a liquor license for its establishment.

HELENA, Mont. – The Montana Lottery who oversees legal sports betting in the state is being sued for changing the rules on who may apply for a license to offer wagers on sporting events.

If a business in Montana wants to become a licensed operator in the sports gambling market, they must also have a liquor license within their establishment as per the new rule set by the Lottery.

Arete Group, a Billings investment and development company is suing the Montana Lottery due to the change that was made after the bill had already been signed into law.

In lawsuit documents, they are requesting that the Lottery cease the approval of any new Montana sports betting licenses until the issue has come to a resolution. Furthermore, they would like to be issued a license to become a sports gambling operator without the need for a liquor license.

“Not once in that bill does it state that you need a liquor license,” said Lyndon Scheveck, the attorney representing Arete Group during a hearing before the State Lottery and Sports Wagering Commission last year. “They’re trying to add a requirement that wasn’t even in the bill.”

What’s In Question

The Montana Lottery was named the regulatory body for the sports betting market when it became a legal pastime in 2019. This means that it is the job of the Lottery to cement all rules and regulations as they see fit.

Amending the law, formerly known as bill MT HB 725 to require operators to possess a liquor license is within their rights, so this lawsuit may just be an act of futility by the Arete Group.

“HB 725 specifically directed the Lottery to use its rulemaking authority to adopt rules regarding sports wagering and sports wagering sales agent licensing,” representatives of the Lottery responded in regards to the lawsuit.

The Lottery has ruled that establishments like that of bars and restaurants who are legally able to sell alcoholic beverages are allowed to apply for a license to offer sports betting at their businesses.

It was first thought that gambling operations be at venues with the proper beverage licenses anyway. The Lottery simply amended the law for clarification on locations as to not drown the state in sports betting operators.

The state of Montana could offer legal sports betting in as many as 1,400 locations when all is said and done. Those locations will be within bars, taverns, and restaurants under their new amendment.

Despite the lawsuit against them, it is unlikely that the Arete Group will get the resolution they seek because, in the eyes of the law, the Montana Lottery has done nothing wrong.

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