# Why is this not illegal sports gambling? **URL:** \ **Category:** Factual Questions\ **Created:** [October 29, 2007, 5:08pm UTC](https://boards.straightdope.com/t/why-is-this-not-illegal-sports-gambling/424464 "2007-10-29T17:08:13Z")\ **Posts on this page:** 20\ **Page:** 1
**Author:** ![Fear\_Itself](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/fear_itself/32/19637_2.png) [@Fear\_Itself](https://boards.straightdope.com/u/Fear_Itself)\ **Post date:** [October 29, 2007, 5:08pm UTC](https://boards.straightdope.com/t/why-is-this-not-illegal-sports-gambling/424464/1 "2007-10-29T17:08:13Z")
[Promotional rebate has thousands of Red Sox fans sitting pretty](http://www.boston.com/news/local/massachusetts/articles/2007/10/29/red_sox_title_means_free_furniture_for_some/) > [@](#): > > The four-store chain promised free sofas, chairs, dining tables and beds to customers who bought between March 7 and April 16 if the Red Sox won the championship. Jordan’s took about 30,000 orders during the promotion. So if I buy furniture and the Red Sox win, I get my money back and my furniture is free. Why isn’t this an illegal sports bet? Just because an insurance company is involved changes nothing; why are they not subject to anti-gambling laws like all other businesses? ---
**Author:** ![Wee\_Bairn](https://avatars.discourse-cdn.com/v4/letter/w/90db22/32.png) [@Wee\_Bairn](https://boards.straightdope.com/u/Wee_Bairn)\ **Post date:** [October 29, 2007, 5:14pm UTC](https://boards.straightdope.com/t/why-is-this-not-illegal-sports-gambling/424464/2 "2007-10-29T17:14:06Z")
Because the customer did not risk any of his own money in the deal? ---
**Author:** ![Otto](https://avatars.discourse-cdn.com/v4/letter/o/bbe5ce/32.png) [@Otto](https://boards.straightdope.com/u/Otto)\ **Post date:** [October 29, 2007, 5:15pm UTC](https://boards.straightdope.com/t/why-is-this-not-illegal-sports-gambling/424464/3 "2007-10-29T17:15:21Z")
What is the furniture buyer risking as his or her side of the “wager”? Presumably they weren’t buying furniture on spec seven months ago on the off chance that the Red Sox would win. ---
**Author:** ![Cyberhwk](https://avatars.discourse-cdn.com/v4/letter/c/7993a0/32.png) [@Cyberhwk](https://boards.straightdope.com/u/Cyberhwk)\ **Post date:** [October 30, 2007, 5:24am UTC](https://boards.straightdope.com/t/why-is-this-not-illegal-sports-gambling/424464/4 "2007-10-30T05:24:21Z")
But if this were the case, wouldn’t this be an all too easy work around for sports betting? In MOST jurisdictions, betting and gambling isn’t illegal. It’s the “vig” that’s illegal (vig = the cut the house takes of winning bets). If a $20 bet is made, and it pays the full $20, this is a legal bet. If the $20 bet wins and the house pays it 19.50 and keeps the .50 it’s illegal. Assuming that’s the case, if it went to court my guess would be that they would argue there was no “vig” and therefore legal. “Not paying for the furniture” was the bet. Or more specifically the “rebate” was the bet. How “insurance” doesn’t qualify as gambling, I’ll never understand though. ---
**Author:** ![RealityChuck](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/realitychuck/32/195_2.png) [@RealityChuck](https://boards.straightdope.com/u/RealityChuck)\ **Post date:** [October 30, 2007, 12:52pm UTC](https://boards.straightdope.com/t/why-is-this-not-illegal-sports-gambling/424464/5 "2007-10-30T12:52:12Z")
[QUOTE=Cyberhwk] In MOST jurisdictions, betting and gambling isn’t illegal. It’s the “vig” that’s illegal (vig = the cut the house takes of winning bets). If a $20 bet is made, and it pays the full $20, this is a legal bet. If the $20 bet wins and the house pays it 19.50 and keeps the .50 it’s illegal. Assuming that’s the case, if it went to court my guess would be that they would argue there was no “vig” and therefore legal. [/quote] Not so. Betting on sports is illegal nearly everywhere. It just that small bets aren’t generally prosecuted. But this isn’t a bet. It’s a promotion. It’s not different than saying “free toaster with every new refrigerator.” The purchasers are getting a product no matter what the Red Sox do, and if the store wants to give them additional product, that’s they’re business. ---
**Author:** ![Bill\_Door](https://avatars.discourse-cdn.com/v4/letter/b/50afbb/32.png) [@Bill\_Door](https://boards.straightdope.com/u/Bill_Door)\ **Post date:** [October 30, 2007, 1:35pm UTC](https://boards.straightdope.com/t/why-is-this-not-illegal-sports-gambling/424464/6 "2007-10-30T13:35:29Z")
Well, how about this then? I sell a ten dollar bill for twenty dollars at my ten dollar bill store. I can sell at whatever price a willing buyer will pay, right? If the Red Sox lose, nothing happens, and I’m ten dollars to the good. If the Red Sox win, I refund your twenty, and you’re ten dollars to the good. Is this gambling, or a promotion? ---
**Author:** ![Wee\_Bairn](https://avatars.discourse-cdn.com/v4/letter/w/90db22/32.png) [@Wee\_Bairn](https://boards.straightdope.com/u/Wee_Bairn)\ **Post date:** [October 30, 2007, 1:48pm UTC](https://boards.straightdope.com/t/why-is-this-not-illegal-sports-gambling/424464/7 "2007-10-30T13:48:15Z")
[QUOTE=Bill Door] Well, how about this then? I sell a ten dollar bill for twenty dollars at my ten dollar bill store. I can sell at whatever price a willing buyer will pay, right? If the Red Sox lose, nothing happens, and I’m ten dollars to the good. If the Red Sox win, I refund your twenty, and you’re ten dollars to the good. Is this gambling, or a promotion? [/QUOTE] Not sure, but that’s different than the OP in that you are exchanging money for money, not money for fungible goods. There’s no good reason anyone would buy a ten dollar bill for twenty dollars in the real world, there is a good reason for them to purchase furniture. Granted in the OP there may be people who didn’t want the furniture who bought it on the “gamble” that it will be free and they will come out ahead, but even if they don’t they still have given money and received something of fair value in exchange. ---
**Author:** ![Dewey\_Finn](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/dewey_finn/32/4222_2.png) [@Dewey\_Finn](https://boards.straightdope.com/u/Dewey_Finn)\ **Post date:** [October 30, 2007, 2:15pm UTC](https://boards.straightdope.com/t/why-is-this-not-illegal-sports-gambling/424464/8 "2007-10-30T14:15:44Z")
[Here](http://www.boston.com/business/articles/2007/04/22/diamonds_and_free_couches_are_a_red_sox_fans_best_friend/?page=1)’s another article from the Boston Globe discussing the legality. Basically, the state attorney general’s office found “no evidence of consumer harm,” and didn’t get involved. It’s also discussed in [this](http://freakonomics.blogs.nytimes.com/2007/10/18/heres-why-yankees-fans-arent-the-only-ones-rooting-against-the-red-sox/) Freakonomics article. (Note that Jordan’s Furniture is a subsidiary of Berkshire Hathaway, which also owns insurance companies, so I’m sure they got a big discount on the insurance contract.) ---
**Author:** ![sachertorte](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/sachertorte/32/3727_2.png) [@sachertorte](https://boards.straightdope.com/u/sachertorte)\ **Post date:** [October 30, 2007, 2:15pm UTC](https://boards.straightdope.com/t/why-is-this-not-illegal-sports-gambling/424464/9 "2007-10-30T14:15:49Z")
The store bought insurance to cover the cost of refunding all the purchases. That was money up front for money if the Red Sox win. That looks like gambling to me. ---
**Author:** ![CookingWithGas](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/cookingwithgas/32/485_2.png) [@CookingWithGas](https://boards.straightdope.com/u/CookingWithGas)\ **Post date:** [October 30, 2007, 2:48pm UTC](https://boards.straightdope.com/t/why-is-this-not-illegal-sports-gambling/424464/10 "2007-10-30T14:48:22Z")
[QUOTE=Wee Bairn] Not sure, but that’s different than the OP in that you are exchanging money for money, not money for fungible goods. [/QUOTE] First, furniture isn’t really fungible, though that’s a tangent. Second, the difference between cash and goods is not relevant here. The important fact here is that the buyer is paying market value for the furniture (I am assuming that the store did not mark \*up \* its prices for this promotion). If the store were offering a promotion that was, “Pay double the price for a chance to win free furniture!” then the store would be in trouble. This promotion does not require the buyer to put a single cent at risk, therefore it is not gambling. ---
**Author:** ![CookingWithGas](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/cookingwithgas/32/485_2.png) [@CookingWithGas](https://boards.straightdope.com/u/CookingWithGas)\ **Post date:** [October 30, 2007, 2:53pm UTC](https://boards.straightdope.com/t/why-is-this-not-illegal-sports-gambling/424464/11 "2007-10-30T14:53:36Z")
[QUOTE=sachertorte] The store bought insurance to cover the cost of refunding all the purchases. That was money up front for money if the Red Sox win. That looks like gambling to me. [/QUOTE] Gray area. The insurance company simply bought risk for less than what they thought it was worth. This is a little different than the function that insurance companies usually perform, which is to pool risk. In this risk, it’s a one-shot deal, unless they hedged their “bets” by insuring a Denver furniture store who ran the same promotion (unlikely). I think Lloyd’s does this one-shot deal stuff all the time. Is life insurance gambling? If you get life insurance, you’re betting you’re gonna die, and you’re going to lose either way. If you live, the insurance company wins, and if you die, you win but you’re dead. ---
**Author:** ![Gus\_Gusterson](https://avatars.discourse-cdn.com/v4/letter/g/85f322/32.png) [@Gus\_Gusterson](https://boards.straightdope.com/u/Gus_Gusterson)\ **Post date:** [October 30, 2007, 3:12pm UTC](https://boards.straightdope.com/t/why-is-this-not-illegal-sports-gambling/424464/12 "2007-10-30T15:12:32Z")
[QUOTE=Dewey Finn] It’s also discussed in [this](http://freakonomics.blogs.nytimes.com/2007/10/18/heres-why-yankees-fans-arent-the-only-ones-rooting-against-the-red-sox/) Freakonomics article. (Note that Jordan’s Furniture is a subsidiary of Berkshire Hathaway, which also owns insurance companies, so I’m sure they got a big discount on the insurance contract.) [/QUOTE] Perhaps they didn’t pay the overhead associated with underwriting the policy, but I’m sure they paid 100% of the premium that would make the insurance policy make sense to the insurer. Berkshire Hathaway runs their companies as separate businesses. It would not be in the insurer’s interest to provide a discount to the furniture store. And I’m sure the insurer’s stakeholders would not allow it. ---
**Author:** ![Jurph](https://avatars.discourse-cdn.com/v4/letter/j/50afbb/32.png) [@Jurph](https://boards.straightdope.com/u/Jurph)\ **Post date:** [October 30, 2007, 3:28pm UTC](https://boards.straightdope.com/t/why-is-this-not-illegal-sports-gambling/424464/13 "2007-10-30T15:28:21Z")
Does anyone want to (ahem) bet that the insurer used the Vegas “line” to calculate the price of the policy? If I were a shareholder in the insurer and they _didn’t_ use that extremely reliable source of risk data, I’d be hopping mad. ---
**Author:** ![Fear\_Itself](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/fear_itself/32/19637_2.png) [@Fear\_Itself](https://boards.straightdope.com/u/Fear_Itself)\ **Post date:** [October 30, 2007, 10:33pm UTC](https://boards.straightdope.com/t/why-is-this-not-illegal-sports-gambling/424464/14 "2007-10-30T22:33:11Z")
A related question: Do the winners have to declare the furniture as income? ---
**Author:** ![Uncertain](https://avatars.discourse-cdn.com/v4/letter/u/6a8cbe/32.png) [@Uncertain](https://boards.straightdope.com/u/Uncertain)\ **Post date:** [October 30, 2007, 11:47pm UTC](https://boards.straightdope.com/t/why-is-this-not-illegal-sports-gambling/424464/15 "2007-10-30T23:47:07Z")
[QUOTE=CookingWithGas] This promotion does not require the buyer to put a single cent at risk, therefore it is not gambling. [/QUOTE] Depends what you mean by “put a single cent at risk”. Notice that the promotional games of chance from McDonald’s, etc., always have a “no purchase necessary” clause. The reason is that otherwise they could be in legal trouble for running a lottery, despite the fact that they’re not jacking up the price of hamburgers. I would guess that if they gave away sex with the furniture that that would be illegal as prostitution, despite the fact that it’s a promotional give-away with market-rate furniture. ---
**Author:** ![Bill\_Door](https://avatars.discourse-cdn.com/v4/letter/b/50afbb/32.png) [@Bill\_Door](https://boards.straightdope.com/u/Bill_Door)\ **Post date:** [October 31, 2007, 12:33am UTC](https://boards.straightdope.com/t/why-is-this-not-illegal-sports-gambling/424464/16 "2007-10-31T00:33:15Z")
[QUOTE=The important fact here is that the buyer is paying market value for the furniture (I am assuming that the store did not mark \*up \* its prices for this promotion). If the store were offering a promotion that was, “Pay double the price for a chance to win free furniture!” then the store would be in trouble. This promotion does not require the buyer to put a single cent at risk, therefore it is not gambling.[/QUOTE] Well of course those buyers paid market price. The market price is always defined as what price a willing buyer will pay to exchange goods with a willing seller. The question is, during the weeks before and after the promotion, were the discounts on the furniture greater than they were during the promotion? No one pays list for furniture, but if discounts were lessened by even as much as $50 to cover the cost of the insurance, then the buyers did have money at risk. And you can sell money for more than it’s face value legitimately, collecters do it all the time. Is the government going to tell me how much I can pay for something? ---
**Author:** ![BobT](https://avatars.discourse-cdn.com/v4/letter/b/8e8cbc/32.png) [@BobT](https://boards.straightdope.com/u/BobT)\ **Post date:** [October 31, 2007, 4:17am UTC](https://boards.straightdope.com/t/why-is-this-not-illegal-sports-gambling/424464/17 "2007-10-31T04:17:52Z")
[QUOTE=Fear Itself] A related question: Do the winners have to declare the furniture as income? [/QUOTE] I doubt it. The people who bought the furniture didn’t earn it. They just got their money back. And that money has to be worth less now than it was when they bought the furniture. ---
**Author:** ![Princhester](https://avatars.discourse-cdn.com/v4/letter/p/3e96dc/32.png) [@Princhester](https://boards.straightdope.com/u/Princhester)\ **Post date:** [October 31, 2007, 4:45am UTC](https://boards.straightdope.com/t/why-is-this-not-illegal-sports-gambling/424464/18 "2007-10-31T04:45:57Z")
[QUOTE=Cyberhwk] How “insurance” doesn’t qualify as gambling, I’ll never understand though. [/QUOTE] Usually you can only insure loss. So at least nominally you can’t make anything out of it. ---
**Author:** ![pkbites](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/pkbites/32/204_2.png) [@pkbites](https://boards.straightdope.com/u/pkbites)\ **Post date:** [October 31, 2007, 5:16am UTC](https://boards.straightdope.com/t/why-is-this-not-illegal-sports-gambling/424464/19 "2007-10-31T05:16:02Z")
[QUOTE=Cyberhwk] In MOST jurisdictions, betting and gambling isn’t illegal. It’s the “vig” that’s illegal (vig = the cut the house takes of winning bets). If a $20 bet is made, and it pays the full $20, this is a legal bet. If the $20 bet wins and the house pays it 19.50 and keeps the .50 it’s illegal. Assuming that’s the case, if it went to court my guess would be that they would argue there was no “vig” and therefore legal. [/QUOTE] I don’t have a specific answer for the OP, but could you tell me where the heck you came up with this? ---
**Author:** ![pkbites](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/pkbites/32/204_2.png) [@pkbites](https://boards.straightdope.com/u/pkbites)\ **Post date:** [October 31, 2007, 5:26am UTC](https://boards.straightdope.com/t/why-is-this-not-illegal-sports-gambling/424464/20 "2007-10-31T05:26:35Z")
[QUOTE=Uncertain] Depends what you mean by “put a single cent at risk”. Notice that the promotional games of chance from McDonald’s, etc., always have a “no purchase necessary” clause. The reason is that otherwise they could be in legal trouble for running a lottery, despite the fact that they’re not jacking up the price of hamburgers.. [/QUOTE] In most jurisdictions gambling needs to have 3 factors present to be gambling: Chance, prize, consideration. If any one is not present, it’s not gambling. \*McDonalds Monopoly game isn’t gambling because there is no consideration (you don’t have to pay for a game piece). \*Video games aren’t gambling because there is no prize awarded \*Carnival games aren’t gambling because they are games of skill, not chance. (this is why the “duck draw” game for kids is supposed to have a mirror at the bottom of the pool. So it turns into a game of skill and not an illegal lottery). [QUOTE=Uncertain] I would guess that if they gave away sex with the furniture that that would be illegal as prostitution, despite the fact that it’s a promotional give-away with market-rate furniture. [/QUOTE] That reminds me of a joke I heard about a woman trying to beat a prostitution rap. “I ain’t no hooker! I sell condoms! The class on how to use them is free!!” 😛 [Next page](https://boards.straightdope.com/t/why-is-this-not-illegal-sports-gambling/424464.md?page=2)