Appeals Court Revives Challenge to New Jersey Casino Smoking Exemption

Panel Orders New Hearing on Constitutionality of 2006 Carveout

Case Sent Back to Trial Court

TRENTON, N.J. — A New Jersey appeals court has ordered a lower court to reopen a challenge to the state’s casino smoking exemption, ruling that the case did not receive a fair hearing the first time around. The decision revives a lawsuit brought by casino floor workers and an anti-smoking group who argue that the state’s 2006 indoor smoking ban violates the constitution by allowing smoking to continue in casinos and their simulcast areas.

A trial judge dismissed the complaint in 2024. But in a ruling released Monday, a three-judge appellate panel found that the judge relied too heavily on written briefs and failed to develop a full factual record. The panel said the court did not properly weigh the workers’ equal protection claims under the New Jersey Constitution.

Judges Fault Earlier Ruling

Writing for the panel, Judge Jack Sabatino said the trial judge must revisit key questions about the exemption and allow testimony from both sides. Sabatino said the lower court must address disputed economic projections about the impact of a full casino smoking ban.

“On remand, the court shall allow the record to be developed and litigated to address the hotly contested projections of revenue loss, and for the court to make appropriate findings of fact concerning the reliability and credibility of the competing expert projections,” Sabatino wrote. He said such findings are “especially crucial” because both employee health and significant revenue concerns are at stake.

The panel also found that the lower court used the wrong legal test. Instead of applying the three-part balancing test required for equal protection claims under the state constitution, the judge used a federal-style rational basis review.

Workers Claim Unequal Treatment

The workers, represented by the United Auto Workers union, sued after repeated legislative efforts to close the exemption stalled. Lawmakers had shown broad support for ending casino smoking, but concerns about possible profit losses slowed action.

Workers argued that the law singles them out to face secondhand smoke. They claimed the exemption violates constitutional guarantees of equal protection and safety and constitutes improper special legislation.

During the pandemic, then-Gov. Phil Murphy halted casino smoking for about 11 months. The ban ended in June 2021.

Disputed Economic Studies at Issue

A casino-funded study claimed that banning smoking would sharply cut revenue by pushing smokers to casinos in other states or causing them to take more breaks. Workers pointed to a different study showing that smoking and non-smoking casinos perform similarly.

The appellate panel said the lower court “improvidently accepted at face value” the industry-backed projections and failed to consider the competing analysis. The judges said the record needs further development before the constitutionality of the exemption can be decided.

The panel declined to rule on whether the state constitution creates a right to safety, saying that question is better suited for the New Jersey Supreme Court.

Next Steps

The case now returns to the lower court, where testimony and evidence will be gathered for a new ruling. The outcome could shape the future of smoking rules in Atlantic City’s casinos and affect thousands of workers who say they breathe harmful smoke on the job.