Tangled Wires: DOJ Reverses 2011 Wire Act Opinion, Online Gambling Effect is Crystal Unclear

Posted on: January 14, 2019, 05:32h. 

Last updated on: January 14, 2019, 06:22h.

The first page of the 23-page just-released November 2018 reinterpretation of the 1961 Wire Act — which directly contradicts the 2011 opinion from the same DOJ Office of Legal Counsel — is likely to cause mass confusion in the American online gaming industry. (Image: www.justice.gov)

A just-released reversal — which was actually determined on Nov. 2, 2018 — of the 1961 Wire Act’s 2011 DOJ opinion (which was in itself a reversal of the original act) — has much of the online gaming industry in a tailspin: mostly of confusion.

Potentially, the new opinion could impact any interstate online gambling, including billion-dollar lotteries, but that will be determined as the dust settles from the shocking revelation.

Whereas May’s US Supreme Court overturn of PASPA — which cleared the way for American states to legalize sports betting within their own borders — was a cause for rejoicing, the reversal opinion, which just came to light late on Monday, January 14, is having a sobering effect, even as most in the gaming industry are unsure how or what it will or won’t impact.

Confused? So is everybody else. Because even if you have an advanced law degree, unravelling the potential ramifications of an opinion that is at odds with at least some existing federal judicial opinions will be daunting at minimum.

In a nutshell, the “Slip Opinion” released today notes that:

This Office concluded in 2011 that the prohibitions of the Wire Act in 18 U.S.C. § 1084(a) are limited to sports gambling. Having been asked to reconsider, we now conclude that the statutory prohibitions are not uniformly limited to gambling on sporting events or contests. Only the second prohibition of the first clause of section 1084(a), which criminalizes transmitting “information assisting in the placing of bets or wagers on any sporting event or contest,” is so limited. The other prohibitions apply to non-sports-related betting or wagering that satisfy the other elements of section 1084(a). The 2006 enactment of the Unlawful Internet Gambling Enforcement Act did not alter the scope of section 1084(a).”

Although the impact could potentially touch interstate lotteries, as well as poker player pools between states, it’s way too early to say if that will or won’t occur. After all, states — including Nevada — have legalized marijuana directly in the face of federal law, and this reversal is simply a legal opinion (as was the 2011 reversal).

Apparently produced at the behest of the US Attorney General’s Criminal Division, which, it is noted in the new opinion, asked the DOJ’s Office of Legal Counsel to reinterpret the 2011 opinion, the new opinion weighs in on whether the Wire Act is specifically limited to sports betting. In doing so, the newly released opinion states:

We do not lightly depart from our precedents, and we have given the views expressed in our prior opinion careful and respectful consideration. Based upon the plain language of the statute, however, we reach a different result. 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. We further conclude that that [sic] the 2006 enactment of UIGEA did not alter the scope of the Wire Act.”

To read the new opinion in its entirety, click here.

This is a breaking story, we will post new developments as they unfold.