US attorneys general call for end to “substantial uncertainty” over Wire Act reinterpretation
More than two dozen state lawyers write to DOJ asking for “fog of ambiguity” to be lifted with 2018 opinion removal
Attorneys general from 26 states have written to the US Department of Justice (DOJ) calling for the recission of its controversial 2018 interpretation of the Wire Act.
In a formal letter to the DOJ, the lawmakers call for the removal of this “reinterpretation” which held that the Wire Act applied to online gaming and lotteries as well as sports betting, something which caused chaos in the US market in 2018.
The 2018 DOJ opinion reversed a prior 2011 DOJ position which held that the 1961 Wire Act applied to only sports betting, thereby making online lottery sales and other non-sports-related online gaming safe from federal prosecution. Following the 2011 opinion, Nevada, Delaware and New Jersey legalized igaming, although just poker in Nevada.
“With the stroke of a pen, the Department suddenly declared that state operated online platforms – which support schools, services for senior citizens, first responders, infrastructure projects, and other critical fiscal needs – were part of a criminal enterprise,” the letter states.
In January, New Hampshire’s attorney general successfully challenged this opinion in the courts, with the US Court of Appeals for the First Circuit agreeing with the lottery that that the Wire Act does not apply to non-sports betting wagering activity.
The New Hampshire attorney general’s office had, on behalf of the state’s lottery, challenged the DOJ’s 2018 interpretation that the statute applied to all forms of interstate gambling, including online lottery ticket sales.
A six-month statutory deadline in which the DOJ could file an appeal against the First Circuit court ruling passed earlier this week without the DOJ’s comment.
Despite this deadline passing, the letter asserts that there is “substantial uncertainty” in the treatment of online gambling in other states, as the ruling set a binding precedent only within the First Circuit and applied to only the specific parties in the suit brought by New Hampshire.
As a result, the ruling has only limited reach from a legal perspective.
Asking for “clarity and finality” from the DOJ in settling the issue, the letter stresses the need for a decision as states and the gambling industry “need to understand what their rights are under the law without having to file suit in every federal circuit.”
In a statement accompanying the letter, New Jersey Attorney General Gurbir S. Grewal said: “New Jersey’s legal gambling industry – and the many state services and programs supported by gaming revenue and tax dollars — would have been devastated in 2020 without online gaming.
“Internet gaming has for years been, and remains, an essential industry here, one the Department of Justice viewed since 2011 as perfectly legal until its baseless backtracking in 2018,” Grewal added.
He cited DGE data which showed internet gaming win in the Garden State shot up 101% in 2020, to $970.3m, a rise largely due to closures of the state’s casinos due to the Covid-19 pandemic.
“It’s time for DOJ to lift the fog of ambiguity surrounding this important national issue, do the right thing and rescind the opinion it issued in 2018.
“We maintained from the start that the Trump-era Wire Act ‘reinterpretation’ was politically motivated and wrong on the law, and we’re proud to now join with our fellow states in calling for its official elimination,” Grewal added.