The United States Department of Justice failed to meet a deadline for action on the Wire Act that could have led to legal disputes over whether the legislation applies to lotteries, and multi-state poker and casino games. The decision by the Biden administration ends confusion over whether the federal government would challenge that such activities come under federal jurisdiction.
Since a 2011 decision by the Department of Justice that the Wire Act only applied to sports betting, several states moved to legalize and/or grant licenses for online poker and casino games, as well as lotteries. But in 2018, the DOJ, under the Trump administration, argued that the Wire Act applied to all forms of betting, not just sports.
In 2019, A U.S. District Court judge ruled in New Hampshire Lottery et a. v. Barr that the Wire Act only applied to sports betting. Earlier in 2021, the U.S. Court of Appeals upheld that decision, a defeat for the outgoing Trump DOJ. The federal government had until June 21 to challenge that ruling, but the deadline was not met, signaling indifference from the current administration on the issue of the Wire Act and how it applies to the burgeoning online betting industry.
What Is The Wire Act?
The Interstate Wire Act was passed at the urging of Attorney General Robert F. Kennedy, and signed by his brother, President John F. Kennedy in 1961. The Wire Act prohibited the operation of certain types of betting businesses in the United States. It was an effort to cripple profits to organized crime from illegal gambling across state lines.
In 2011, the federal government ruled that the Wire Act only applied to betting on a “sporting event or contest,” and as a result, any new legislation on betting other than that type of activity would not be hindered by the 1961 law.
What This Ruling Means For The Online Poker Industry
The current Department of Justice is choosing to remove any wrangling over the language of the Wire Act and to maintain the status quo that allows states to regulate and operate games like online poker, casinos, and multi-state lotteries that involve players and commerce across state lines. As a result, any pending lawsuits on this issue will likely be dropped, and operators across the country will continue to offer these games without worry that the industry could be hampered by the federal government.