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Thread: DOJ reverses 2011 favorable Wire Act opinion

  1. #1
    Gold garrett's Avatar
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    DOJ reverses 2011 favorable Wire Act opinion

    Looks like the rumors were true, DOJ reverses 2011 favorable opinion

    Now applies to all forms of gambling not just sports betting

    https://www.onlinepokerreport.com/34...e-act-opinion/

  2. #2
    Gold ftpjesus's Avatar
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    If that’s truly how DOJ intends to align the Wire Act. They’re going to learn the hardest way about the law of unintended consequences.

    1. They basically just likely made every one of those linked multimillion dollar slot machine setups like Wheel of Fortune ILLEGAL as they do pass data across state lines.

    2. The arguement also could be made that they also just made MegaMillions and Powerball illegal as they seem to be harping on data transmission along states well the multi state lottery group does have plenty of data that crosses state lines in sharing data.

    There is no doubt major litigation will be forth coming and could very well include multiple states themselves suing the Feds plus Indian Tribes and also wouldn’t shock me if MGM and Ceasers get involved especially given some court rulings out there already conflict directly with this new interpretation.

    On a side note anybody think Adelson has in fact made a legitimate deal with Satan to stay alive. That miserable SOB is like a case of hemeroids you can’t get rid of no matter what you do.
    <This Ad Space for Rent or Sale>

  3. #3
    Owner Dan Druff's Avatar
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    This is 2.5 months old, but everyone is just hearing about it now, because it was buried at the time under other more "important" news in DC.

    This may or may not matter in practice, but it's definitely a bad thing in theory.

    This now gives the federal government power to take action to prohibit interstate gambling.

    It will NOT interfere in any online gambling taking place WITHIN a state, as the 1961 Wire Act only deals with interstate betting.

    This means that the recently-passed sportsbetting legalization (giving power to the states to decide) will be unaffected, and none of the recently-opened sportsbooks in non-Nevada states will be closed.

    This also means that state-restricted online poker will not be affected, BUT the compacts between states to share player pools (such as the one in poker involving Delaware/Nevada/New Jersey) might end up being reversed.

    This could also largely put the brakes upon the expansion of online poker in states, if it's known that they can't partner with other states to enlarge player pools. It has already been seen that online poker is a huge fail if it's confined to a tiny state (Delaware), mostly a fail in a small state (Nevada), and somewhat of a fail in a medium state (New Jersey).

    This is unlikely to affect any of the existing illegal poker rooms and sportsbooks (such as Bovada), as they were already operating illegally. If anything, this might strengthen them, if it ends up slowing down legalized online poker.

  4. #4
    Silver sah_24's Avatar
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    This changed absolutely nothing ... yawn. Addelson hurry up and fucking die already

  5. #5

    Whew....okay. Thanks for the break down.

  6. #6
    https://www.cdcgamingreports.com/doj...g-in-question/

    The U.S. Department of Justice’s Office of Legal Counsel reversed a 2011 opinion that the Federal Wire Act applies only to sports betting, potentially throwing the small U.S. Internet gaming market into question.

    The 23-page opinion is dated Nov. 2, 2018 but became public Monday. It was posted to the Justice Department’s website long after it was distributed. In the opinion, attorneys wrote, “Based on the plain language of the issue, we reach a different result” than the December 2011 opinion concerning the 1961 Act. That decision, under President Barack Obama’s Justice Department, marked a dramatic shift in policy.

    “While the Wire Act is not a model of artful drafting, we conclude that the words of the statute are sufficiently clear and that all but one of its prohibitions sweep beyond sports gambling,” Justice Department attorneys wrote. “We further conclude that that the 2006 enactment of (Unlawful Internet Gambling Enforcement Act) did not alter the scope of the Wire Act.”

    The new Justice Department opinion could apply the Wire Act to any form of gambling that crosses state lines, including online gaming.

    Following the 2011 decision, New Jersey, Nevada and Delaware legalized online gaming. Nevada’s online gaming activity is restricted to poker only. Pennsylvania lawmakers legalized Internet gaming last year as part of an overall gaming expansion, but websites have been slow to launch.

    How to interpret the decision

    The Justice Department’s opinion led to wide range of opinions late Monday on what the ruling means.

    “Given that DOJ now believes the Wire Act prohibits non-sports related wagering, state regulators and interstate gaming operators will have to digest the opinion and consider the particular implications to each state and operator,” said Mark Clayton, co-chair of the Global Gaming Law Practice for Greenberg Traurig.

    Eilers & Krejcik Gaming analyst Chris Grove said the opinion places “many conflicting aspects” into play.

    “It’s our belief that we’ll see the heart of this issue head to the courts sooner rather than later,” Grove said. “The opinion seems to create more headaches for products that clearly share liquidity across state lines. We also expect it to further delay Pennsylvania’s rollout of online casino gambling.”

    Washington D.C.-based gaming attorney Jeff Ifrah said two appellate court decisions support the 2011 interpretation of the Wire Act.

    “The revised opinion does not reflect the thoughtful and more careful analysis issued by the two highest federal courts of appeal that have reviewed this precise question,” Ifrah said. “This opinion standing alone, of course, changes nothing and is of no significance or value. It is unfortunate that the Office of Legal Counsel appears to have been manipulated to issue an opinion for purely political purposes.”

    American Gaming Association spokeswoman Caroline Ponseti said the Washington D.C. organization is “reviewing the opinion and the implications to the casino gaming industry, consumers and the eight states that currently offer legal, regulated sports gaming.”

    Backing the ruling

    The Coalition to Stop Internet Gambling, an advocacy group funded by Las Vegas Sands Corp. Chairman Sheldon Adelson that has long sought a reversal of the 2011 Wire Act opinion, applauded the ruling. In a statement, the organization said the Justice Department’s 2011 opinion “was as problematic legally as it was morally.”

    A spokeswoman for Las Vegas Sands declined comment and referred questions to the Coalition.

    Former U.S. Senator Blanche Lincoln of Arkansas, in a statement provided by the Coalition, said Justice Department’s action “to rightfully restore the Wire Act” was “a win for parents, children and other vulnerable populations.”

    Lincoln added, “Today’s decision seamlessly aligns with the department’s longstanding position that federal law prohibits all forms of Internet gambling, as well as with Congress’s intent when it gave law enforcement additional tools to shut down the activity through the overwhelmingly-passed Unlawful Internet Gambling Enforcement Act in 2006.”

    One gaming industry source, who disagreed with the new Wire Act interpretation, put blame on the current administration in Washington D.C.

    “Notwithstanding President Donald Trump’s previous casino involvement, former Attorney General Jeff Sessions and other conservatives have made no secret of their desire to use the Wire Act as a means to limit all forms of online gambling,” the source said. “We have now seen the results.”

    Current online gaming operations

    Nevada’s online poker market has shrunk to just one company – Caesars Entertainment.

    New Jersey, however, has the most active Internet gaming business of any state. According to the New Jersey Division of Gaming Enforcement, gaming revenue from online wagering was $298.7 million in 2018, a 21.6 percent increase from 2017. Since its launch in 2013, Internet gaming in New Jersey has generated more than $1 billion in revenue.

    Nevada, Delaware and New Jersey have interstate online gaming agreements that allows Internet poker players to compete across the three states.

    Caesars Entertainment, which operates Internet gaming in both Nevada and New Jersey, declined comment Monday.

    “(We) will take some time to review opinion and get outside legal advice,” said Seth Palansky, who is the head of communications for the Caesars’ owned World Series of Poker.

  7. #7
    Owner Dan Druff's Avatar
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    Two developments:

    Us Deputy AG Rod Rosenstein is giving businesses 90 days to comply with the new interpretation, basically stating that this is an informal grace period, and they may choose to penalize businesses who ignore the new law interpretation on Day 91: https://www.onlinepokerreport.com/34...90-day-window/

    Adelson lobbyists have been tracked to have been behind this: https://outline.com/tytq5L

    There is a fair chance that WSOP.com will de-link the Nevada/New Jersey/Delaware partnership before then.

  8. #8
    Serial Blogger BeerAndPoker's Avatar
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    Perhaps it's just a theory but I think the biggest target of this reversal is to come at the DFS sites who are bringing it tons despite claiming they keep operating at a loss.

    When this passed with the language as written DFS sites used a loophole but the reality is the DOJ was thinking more about letting people have their season long fun fantasy leagues for money and not what DFS has created.

    It's all about where they are losing the most money and prior to 2011 that was poker but after the big players (Stars/FTP) pulled out it's now the DFS sites.

  9. #9
    Owner Dan Druff's Avatar
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    BUMP

    Update: https://www.pokernews.com/news/2019/...-34392.htm?utm

    A judge has ruled that the Wire Act does NOT apply to online poker.

    However, it's still bad news for sportsbetting, as it appears they will not be able to make interstate compacts due to this interpretation.

  10. #10
    Quote Originally Posted by Dan Druff View Post
    BUMP

    Update: https://www.pokernews.com/news/2019/...-34392.htm?utm

    A judge has ruled that the Wire Act does NOT apply to online poker.

    However, it's still bad news for sportsbetting, as it appears they will not be able to make interstate compacts due to this interpretation.
    Nobody is going to act on this decision. It’s noise. It’s just a stepping stone to the Supreme Court

    My question to you is why you think this was bad news for Sports Wagering? Player pools have nothing to do with it. The information, companies and services will remain common across states.

    If anything keeping things a little bit regional creates some local public weakness which is good for the game.

    Ex: Rhode Island and the Patriots - Pennsylvania and the Steelers. Favorites still win (Patriots) but it’s good for the game.

  11. #11
    Quote Originally Posted by Sanlmar View Post
    Quote Originally Posted by Dan Druff View Post
    BUMP

    Update: https://www.pokernews.com/news/2019/...-34392.htm?utm

    A judge has ruled that the Wire Act does NOT apply to online poker.

    However, it's still bad news for sportsbetting, as it appears they will not be able to make interstate compacts due to this interpretation.
    Nobody is going to act on this decision. It’s noise. It’s just a stepping stone to the Supreme Court

    My question to you is why you think this was bad news for Sports Wagering? Player pools have nothing to do with it. The information, companies and services will remain common across states.

    If anything keeping things a little bit regional creates some local public weakness which is good for the game.

    Ex: Rhode Island and the Patriots - Pennsylvania and the Steelers. Favorites still win (Patriots) but it’s good for the game.
    agree with your overall premise here, BUT it will be interesting to see when PA comes online if they are willing to pool with NV/NJ (I think they're allowed to based on the way their state gaming laws are written, but could be wrong on that) based on this decision...

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