PointsBet passed over for Arizona license as state awards sports betting permits

PointsBet’s ambitious US expansion plan was dealt a hammer blow over the weekend after the operator missed out on a highly coveted sports betting licence to operate in Arizona.

Regulators from the Arizona Department of Gaming (ADG) unveiled the first 18 recipients of a sports betting licence in the state, which did not include PointsBet or its local tribe partner.

PointsBet had teamed up with the Cliff Castle Casino, owned by the Yavapai-Apache Nation, with the intention to expand into the Grand Canyon State following the legalisation of sports betting earlier this year and market’s launch on 9 September in time for the new NFL season.

Operators were assessed on a range of criteria, including track record, financial stability, compliance and contributions to the community, with special consideration given to companies with a physical presence in the state.

ADG officials have not revealed why PointsBet or its tribal partner did not receive a licence.

In comments reported by Australian news outlet The Age, PointsBet CEO and MD Sam Swanell said he was taken aback by the state’s decision.

“We fully expected that we would be holding one of those licences,” he said. “It’s fair to say it was a bit of a surprise.

“We believed we had the right partner; we’ll now have a look around and see how that plays out,” Swanell added.

PointsBet, which is currently live in seven states, is reportedly considering whether to legally challenge the decision made by ADG officials.

An offshoot of PointsBet’s Arizona partner, the Yavapai Prescott Nation, filed a lawsuit with the Maricopa County Superior Court on Friday against Arizona Governor Doug Ducey and ADG gaming director Ted Vogt alleging the new sports betting law violates existing state legislation.

The tribes claim the law violates Arizona’s Voter Protection Act, in that it permits non-tribal gaming operators to gamble outside of tribal land.

The lawsuit also alleges the distortion of the Indian Gaming Preservation and Self-Reliance Act, which authorises tribes in the state to operate limited forms of gambling in tribal-owned casinos.

A total of 10 available licences were awarded by ADG regulators to the state’s tribal operators and their international partners, which include Unibet, Churchill Downs, Golden Nugget Online Gaming, Betway and Wynn.

Eight further sports betting licences were awarded to the state’s sports teams and sporting organisations, granting access to operators including BetMGM, William Hill, DraftKings, FanDuel, Penn National Gaming, Bally’s and Rush Street Interactive via partnership contracts.

Of the eight licensees, NHL franchise the Arizona Coyotes was the only team without a named sportsbook partner.

Two sports betting licences have not yet been allocated to either a tribal gaming operator or state-run sports team or organisation, leaving the door open for PointsBet to return with a new application or partner.

ADG gaming director Ted Vogt hailed the impact of public and stakeholder collaboration throughout the implementation process as enabling the state to deliver sports betting licensing quickly.

The state only passed legislation in April.

“This partnership, as well as the hard work of department staff, has allowed Arizona to be one of the fastest states to operationally start these new games since the passing of the enabling legislation,” he explained.

“I am proud of the hard work by all to accomplish this feat and excited to see Arizonans responsibly enjoy legal fantasy sports starting tomorrow, as well as event wagering in September,” Vogt added.

MaximBet, which had eyed an Arizona launch in partnership with the White Mountain Apache Tribe, also missed out on a sports betting licence.

ADG officials have also named six authorised fantasy sports operators, with the state’s regulated DFS market going live over the weekend.

DraftKings, FanDuel and Yahoo Sports are among the DFS operators able to target Arizona players.