When the Department of Justice issued a new Wire Act opinion in January, legal online gambling in the US suddenly found itself in dire straits.
Initial takes on the new opinions impact ran the gamut. Some speculated it was meaningless. Others believed it could bring about the end of all legal online gambling in the US, and possibly even retail lotteries.
While the sky didn’t fall at any point, storm clouds of uncertainty formed.
Wire Act uncertainty leads to legal action
The threat of a government shutdown caused enough anxiety that the New Hampshire Lottery filed suit against the DOJ in February. That case was heard by Judge Paul Barbadoro in New Hampshire District Court on April 11.
On June 4, Judge Barbadoro issued a 60-page ruling in favor of the New Hampshire Lottery.
It was close to a total victory. Judge Barbadoro ended the opinion with:
“I hereby declare that § 1084(a) of the Wire Act, 18 U.S.C.§ 1084(a), applies only to transmissions related to bets or wagers on a sporting event or contest. The 2018 OLC Opinion is set aside.
New Hampshire Gov. Chris Sununu was thrilled with the result for the Granite State.
“Today’s ruling is a historic victory for the State of New Hampshire, and we are proud to have led this effort,” said Sununu.
“New Hampshire stood up, took action, and won – all to protect public education in our state. I would like to thank the Attorney General’s Office and the Lottery Commission for their work on this critical case.”
But what does the ruling mean for other states? States like New Jersey?
Here are a few initial thoughts.
Status quo… for now
The ruling was a welcome relief for New Hampshire and other online gambling states such as New Jersey. The ball is now in the DOJ’s court, with Judge Barbadoro’s edict the last word at the moment.
That means it’s business as usual for online gambling states. The 20+ NJ online casinos that operate in the state won’t be going anywhere. Payment processors can breathe a sigh of relief, as can the interstate online poker network comprising New Jersey, Nevada, and Delaware.
But, the final chapter of this story has yet to be written.
“They have a right to appeal,” said New Hampshire Lottery Executive Director Charlie McIntyre in an interview with a New Hampshire TV station. “They have to file that within a month, and if they do, it goes on. But certainly, we’re business as usual.”
Does the ruling extend beyond New Hampshire?
But is it really “business as usual” for New Jersey, too? How far-reaching the ruling is remains an open question.
“Today, a federal judge in another state agreed with our arguments, confirmed the Wire Act allows online gaming to flourish, and set aside DOJ’s flawed approach,” said New Jersey Attorney General Gurbir S. Grewal. “I call on DOJ to comply with this ruling across the country, and to finally drop its efforts to criminalize state-sanctioned online gaming.”
Matthew McGill, counsel for the plaintiffs, told the Associated Press:
“Because the court ‘set aside’ the Justice Department’s incorrect re-interpretation of the Wire Act, this ruling has nationwide impact. Throughout the country, state lotteries and others in the gaming industry once again can rely on the Justice Department’s 2011 opinion that the Wire Act is limited to sports betting.”
Or is it limited in its scope?
Other legal experts have noted that the ruling should only be read as affecting the New Hampshire Lottery and the other plaintiffs in the case.
“This is not a nationwide decision granting declaratory relief, as Barbadoro limited the decision to the plaintiffs involved in the case,” according to Legal Sports Report’s John Holden.
The Coalition to Stop Internet Gambling, which joined the case as an amicus of the defendants agrees with that assessment, telling the AP:
“While we disagree with many of the views expressed in Judge Barbadoro’s ruling, we are happy that the scope of the opinion was confined to the parties involved. We are confident that other jurisdictions will see this issue very differently and our resolve to protect at-risk populations has only been strengthened by today’s decision.”
The jury is still out on this one.