Gamblers place bets in the temporary sports betting area at the SugarHouse Casino in Philadelphia.

Matt Rourke / AP Photo

The District’s plan to allow residents and visitors to cast bets on sports using an app developed by the D.C. Lottery was dealt a blow on Thursday, when a judge ruled that the D.C. Council’s decision to grant Greek gaming company Intralot a sole-source contract was potentially illegal.

In a brief order—which was first reported by NBC4’s Mark Segraves—Judge Joan Zeldon temporarily stopped the city from issuing any payments to Intralot, which received a $215 million sole-source contract earlier this summer to keep operating the D.C. Lottery and also to develop the only app that fans will be able to use citywide to cast sports bets.

The order comes in response to a lawsuit filed last week by D.C. resident Dylan Carragher, who said he had developed a sports betting app and hoped to vie for a piece of the potentially lucrative sports betting market in the city. In the lawsuit, he argues that the city’s decision to grant Intralot a contract without going through the traditional competitive bidding process violated the Home Rule Act.

“We were praying hard for this. It’s the right decision. The judge looked at this and threw the ball straight across the plate,” said Donald Temple, Carragher’s attorney. “He just wants the opportunity to compete,” he added, referring to Carragher.

Zeldon’s ruling is another potential delay in what had been a rocky rollout for sports betting in D.C., which was legalized late last year. While licenses for physical sports betting locations are likely to start being issued in the next month or so, Intralot’s app — which was expected to be ready in January — was already facing political and legal obstacles.

Critics say Chief Financial Officer Jeffrey DeWitt and the Council erred in sole-sourcing the contract, which DeWitt said was necessary to get sports betting off the ground ahead of either Maryland or Virginia. But the contract with Intralot—which has run the city’s lottery for a decade—has prompted numerous unflattering revelations, including that the company’s local partner may not be so local after all. Two D.C. Council members say they are looking into the contract and have asked D.C.’s Attorney General Karl Racine to review its legality.

“I’ve had concerns all along about avoiding the competitive bidding process and our procurement rules. It looks like the court agrees with me,” said At-large Councilmember Elissa Silverman. “I want a lottery and sports betting contract that our public has confidence in.”

During the debate over the contract, private sports betting companies like DraftKings and FanDuel urged the council to instead create a system where they could apply for licenses to operate their apps in the city. Under the current regulations, privately developed apps will be allowed inside venues that offer sports betting, but only the D.C. Lottery’s app will be available for use anywhere else in the city.

D.C. Council Chairman Phil Mendelson said he believes the judge will reconsider the decision once the issue is fully argued.

“It’s just a stop-the-clock decision,” he said. “It’s based on an esoteric reading of an arcane provision of the Home Rule Act, and I don’t think this ruling will stand. I’m hard pressed to understand how we can amend the procurement practices law anytime, but we can’t amend it with regards to the CFO.”

Mendelson also said it was too early to consider what the Council and CFO would have to do if the ruling against them stands. An emailed request for comment from DeWitt was not immediately returned, neither was a call to the D.C. Lottery. A spokeswoman for Racine said they were “reviewing today’s order and we look forward to proceeding to additional arguments.”

Zeldon’s restraining order will remain in effect for 14 days, and she has called Temple and city attorneys to come back to court next week where she will schedule a full hearing on Carragher’s request for a preliminary injunction against the city.

This story originally appeared on WAMU, and has been updated with comments from Mendelson and a spokesperson for Racine.