Summary: The state of Pennsylvania is the latest to join a legal fight regarding the Department of Justice recent opinion change involving the Wire Act of 1961.
In 2011, the Obama Administration’s Department of Justice decided to change the legal opinion of the Wire Act. The Wire Act was first established in 1961 and had not been changed since. With internet usage so heavily present, the DOJ decided to make a change.
This opened up states to the option of legalizing online gambling. The Wire Act would apply to interstate sports betting only, allowing other gambling options to be legalized. Because of that, New Jersey, Delaware and Nevada were able to offer online gaming, both casino and poker options.
Fast forward, and states are now offering online sports betting, online lottery and more. This year, it came to light that the new DOJ, under the Trump Administration, had decided to review the Wire Act and change it again. This time, not only is sports betting not to be conducted interstate but any legal online gambling is now in that category. Operators and states quickly began to announce their displeasure of the change as it affects millions of dollars in several states.
Regulated States Fighting Back
A lawsuit has been filed against the DOJ involving the Wire Act decision, starting with the New Hampshire State Lottery. Other entities in New Hampshire then came forward and now Pennsylvania has joined the suit.
Once the ruling was made known, Pennsylvania Attorney General Josh Shapiro and Attorney General Gurbir Grewal of New Jersey wrote a letter to the administration announcing their opposition to the change. In the letter, the two say that the reversal is wrong and they wanted to know more about why the change was made in the first place.
The New Hampshire Lottery filed the suit initially in February to try and stop the DOJ from interfering with state operated online gambling. On the very same day, the Pollard Banknote company, the lottery supplier for New Hampshire, also filed a suit.
The suits were quickly consolidated into one action, with more plaintiffs coming forward to file against the decision. It was announced last week that Pennsylvania wants in on the action. The state acted through their Department of Revenue and their own Lottery to file a request to be part of the suit.
In their decision to join the suit, Pennsylvania pointed out worry about lottery games such as the Powerball, that take place in several states. The state feels that the legality change could result in all state lottery sales being suspended which would create a loss of income of more than $1 billion that is provided to seniors of the state due to lottery earnings.
New Jersey On Board
Not only has Pennsylvania asked to join the suit, but New Jersey has now filed an amicus brief on the matter. The state is also worried that the opinion change will be broadly applied and their interstate gambling options will be at risk.
A big issue with the Wire Act change is routing. When transactions are routed from say online lottery games, the routing process may take place in one state and then move back into the state before the transaction is complete. This normal process could be a way for the DOJ to uphold their ruling and this would cause issues among online gambling operations across the United States.
Along with New Jersey, Michigan and their state lottery have also filed amicus brief. The paperwork of the state was signed by other states according to Online Poker Report, including Rhode Island, Tennessee, Kentucky and Virginia.
It seems the DOJ has a big battle on their hands as states are not standing by why ridiculous changes are made to legislation that will only serve to harm online gambling operations as a whole.
