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The attorneys general of New Jersey and Pennsylvania had some choice words for the US Department of Justice for its recent reversal on the interpretation of the federal Wire Act. And one of the AGs wants to know what one of the gaming industry’s biggest names had to do with it.
The two state AGs have sent a letter to the DOJ voicing its “strong objections” to the department’s new claim that the Wire Act applies to all forms of interstate gaming, not just sports betting. “We can see no good reason for DOJ’s sudden reversal,” they wrote in the letter, which can be seen here.
The DOJ opinion has the potential to have a chilling effect on both states’ lotteries and online casino industries, which surfaced in the wake of a 2011 opinion from the DOJ’s Office of Legal Counsel that said the Wire Act applies only to sports betting.
Last month’s DOJ opinion sought to reverse that guidance, despite two federal circuit courts and most legislative history accounts saying that the Wire Act was indeed meant to cover only sports gambling.
More from the letter:
But DOJ now contends that transmission of information relating to any kind of online wagering can violate federal criminal law. And the new opinion suggests that criminal charges can be brought even where the interstate transmission of information is merely incidental to betting that is otherwise entirely lawful under state law.
The potential breadth of this opinion is deeply troubling. The opinion casts doubt not only on traditional online gaming, but also multi-state lottery drawings (such as Power Ball and Mega Millions) and online sales of in-state lottery tickets.
The NJ AG, Gurbir S. Grewal, took the added step of filing a Freedom of Information Act request to find out if casino owner Sheldon Adelson had anything to do with the new Wire Act opinion. Adelson has long sought federal intervention legislatively to stop the spread of online gambling in the US.
From a press release from the state of NJ:
Press reports indicate that pressure to reconsider the legality of online gaming followed lobbying efforts by Sheldon Adelson and affiliated lobbyists. After Adelson’s Coalition to Stop Internet Gambling was unable to persuade Congress to address the issue, then-U.S.-Attorney General Jeff Sessions agreed to look into it.
The New Jersey FOIA request seeks information on any communications involving Adelson, his lobbyists, the White House, and DOJ regarding the relevant federal law and online gaming.
The Wall Street Journal recently alleged a fairly direct line between Adelson, president of Las Vegas Sands, and the issuance of the opinion.