The general counsel and executive vice president of Houston-based Fertitta Entertainment cast doubt on Texas getting legalized gaming anytime soon and told Nevada regulators he sees the Supreme Court preventing prediction markets from operating outside of state regulation.
Steven Scheinthal weighed in on those topics when he appeared Thursday before the Nevada Gaming Commission for licensing as a member of Fertitta Entertainment’s board.
Las Vegas Sands has led a failed attempt in Texas to get gaming approved through the Texas Legislature.
“Based on the current state politics, I don’t envision that gaming would come to Texas,” Scheinthal said. “Things could change, but if the politics stay the same in 2028, nothing will change in Texas until 2032.”
As for prediction markets, Nevada and other states are locked in legal battles with operators who are accepting sports wagers under the aegis of the Commodity Futures Trading Commission rather than states themselves. Cases in federal court are expected to go to the Supreme Court.
“Ultimately, the Supreme Court will say it’s up to the states to decide and it will be up to each state to determine the rules,” Scheinthal said. “If the states make it unlawful, I don’t think a prediction market company will be able to point to the CFTC as a protection point once the Supreme Court speaks to it. I’m hypothesizing, but if you look at who’s on the Supreme Court and their previous decisions (about) state’s rights, that would be the direction they’d head.”
In giving additional insight, Scheinthal said a famous investor who shorted the housing market in 2008 and made billions of dollars has invested in FanDuel and DraftKings, saying he believes the prediction markets will be shut down by the states and Supreme Court.
Tilman Fertitta and his company own about 2% of DraftKings stock, but he has no control position, Scheinthal said. News accounts suggested he was a board but the NBA said if Fertitta was a member of the DraftKings board, DraftKings would have to take the Fertitta-owned Houston Rockets out of their app.
“That’s not something DraftKings was willing to do,” Scheinthal said. “So Tilman agreed to never become a board member. He has zero operational control. He’s an investor just like you or I might own some shares in DraftKings stock.”
Scheinthal said he also owns some shares of DraftKings stock.
