NJ Attorney General Asks US AG Garland To Rescind Wire Act Opinion Threatening Online Gaming

Written By Derek Helling on June 25, 2021
NJ Wire Act

For former US Attorney General William Barr’s 2018 Wire Act opinion, it’s seemingly all over but the crying. New Jersey Attorney General Gurbir S. Grewal would like to see current US AG Merrick Garland actually “produce the tears,” though.

The US Dept. of Justice (DOJ) has already passed on appealing its loss in a lawsuit on the matter. However, Grewal’s request to Garland raises multiple concerns that Garland could easily ease by fulfilling Grewal’s request.

Why is the DOJ Wire Act opinion important?

It’s all about the potential threat of federal action against online gambling in New Jersey. Until 2018, the DOJ’s opinion on the Federal Wire Act of 1961 was that its tenets only apply to sports betting. The language of the act explicitly bans the transmission of data and funds for gambling purposes across state lines.

Under Barr’s watch, however, the DOJ issued a new opinion stating that the same language could apply to all online gambling. That meant the DOJ could have pursued federal charges against online gambling companies even if they were operating in accordance with state-level laws.

Almost immediately thereafter, the New Hampshire Lottery and its vendor, NeoPollard, sued Barr in federal court. The complaint argued that Barr’s opinion was errant and that merely the threat of such prosecution unjustly harms their business interests.

The plaintiffs won at the district level and in the First Circuit Court of Appeals in January. At that point, the DOJ not only changed leadership but also had a decision to make. Its only appeal option left was the US Supreme Court.

Last week, the DOJ chose to let its deadline to ask the Supreme Court to grant cert (review the lower court’s decision) pass. However, as Grewal’s letter points out, that doesn’t entirely resolve the matter on its own.

What Grewal is asking for

Essentially, Grewal is asking for Garland to issue a new opinion formally adopting the opinion of the First Circuit Court on the Wire Act. That would restore a narrow, sports betting-only interpretation. That’s an important action for a couple of reasons.

As Grewal’s letter points out, the opinion of the First Circuit only really applies to its territory. That covers:

  • Maine
  • Massachusetts
  • New Hampshire
  • Puerto Rico
  • Rhode Island

Furthermore, the Court’s opinion is truly enforceable only in regards to the parties to the lawsuit. Technically, the Court’s ruling doesn’t bar the DOJ from bringing any action against any online gambling companies in NJ. That would require new and separate litigation.

As long as the 2018 opinion stands as the DOJ’s official interpretation, the risk remains, albeit low. This is especially relevant for online poker in NJ, as it operates a multi-state compact with Delaware and Nevada. Expansion of that compact into Michigan and Pennsylvania is also a current possibility.

Grewal knows that with the simple issuance of a document, Garland can take that risk of prosecution from low to zero. Garland has the power to take that action unilaterally, without any legislative or extra executive concurrence. To secure confidence in the present and future of online gambling in NJ, it’s worth the ask.

Photo by AP/Matt Rourke
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Derek Helling

Derek Helling is a lead writer for PlayUSA and the manager of BetHer. He is a 2013 graduate of the University of Iowa and covers the intersections of sports with business and the law.

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