Another NH lawsuit challenging Wire Act opinion

Online Gambling Trade Group Files Third Wire Act Challenge In New Hampshire Federal Court

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New Hampshire has become the epicenter for opposition to the new Wire Act opinion from the US Department of Justice.

Last week, the state lottery and its technology supplier each filed a related lawsuit in the US District Court for NH. The first names new US Attorney General William Barr and the DOJ as defendants, while the latter adds the United States of America itself.

As of Monday, another federal lawsuit is on file in the Granite State.

Specialist firm Ifrah Law has brought action against the DOJ on behalf of iDEA Growth, a trade group advocating for regulated online gambling. Theirs marks the third formal challenge to the Nov. 2018 opinion from the DOJ’s Office of Legal Counsel, which expanded its Wire Act interpretation to cover all interstate wagering.

Here’s lead attorney Jeff Ifrah on the filing:

“We trust that the New Hampshire Court will give appropriate weight to judicial precedent over political factors in making its decision, a decision sure to have a major impact on a fast-growing industry poised to offer significant economic benefits to states across the country.”

IDEA Growth counts the parent company of Online Poker Report among its members.

The gavel is in New Hampshire’s court

The First Circuit, to which the NH courts belong, is perceived as one of the most favorable venues for Wire Act litigation. Although it has not directly ruled on the scope of the 1961 federal law, the appellate court narrowly applied the provisions to its decision in United States v. Lyons.

Gambling stakeholders also have the sort of legal standing required to bring such a challenge.

While the legislature is advancing a bill that would legalize statewide mobile sports betting, New Hampshire is also one of six states that sells lottery tickets over the internet. Multi-state lottery games like Powerball and Mega Millions figure to be in the most immediate jeopardy if the OLC enforces its new stance.

Though NH night be an ideal jurisdiction, questions over ripeness and other legal specifics may make litigation difficult.

Here’s more on the two other suits:

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Wire Act challenges elsewhere?

There’s at least a chance of additional legal action outside of New Hampshire, too.

Last week, New Jersey Senate President Stephen Sweeney threatened a lawsuit on behalf of his state if the DOJ does not rescind the new opinion. The Third Circuit in which NJ resides, however, is generally seen as a riskier venue for a Wire Act challenge.

The Fifth Circuit, which encompasses three southern states, is another potential (though less-likely) venue for Wire Act litigation. Unlike the Third Circuit, it has published a binding opinion (In re: Mastercard) upholding a narrow interpretation. It’s unclear if Louisiana, Mississippi, or Texas would have the standing — or the interest — to pursue a challenge in court.

No casino or online gambling operator has filed or threatened legal action publicly, but some pressure is building beneath the surface. In a recent MGM earnings call, CEO Jim Murren called the new opinion “absurdly poorly written and unenforceable.”

Companies like MGM and Caesars are no doubt exploring the best course of legal action in the wake of the DOJ’s reinterpretation, too.

- Eric is a reporter and writer covering regulated US gambling, sports betting, and DFS. He comes from a poker background, formerly on staff at PokerNews and the World Poker Tour.
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