Congress is involving itself in the attempt by the Department of Justice to expand the scope of the Wire Act. And believe it or not, federal lawmakers are acting on behalf of state-regulated online gambling industries.
Members of the Rules Committee filed an amendment to an appropriations bill on Tuesday that would block the funding needed to enforce a new interpretation of the 1961 law. The department’s Office of Legal Counsel issued an opinion last year attempting to expand its provisions — initially limited to sports betting — to include all forms of gambling.
Rep. Hank Johnson (D-GA) is the primary sponsor of the amendment, joined by Rep. Sanford Bishop (D-GA) and Rep. Andy Barr (R-KY). Online lottery sales in both Georgia and Tennessee could be in serious jeopardy under the new OLC opinion.
In addition to the myriad other provisions, the bill in committee (HR 3055) is directly responsible for paying the DOJ’s salary.
The proposal is short and straight to the point. Here’s the full text of the new section:
“None of the funds made available by this Act may be used to enforce the Department of Justice Office of Legal Counsel memorandum entitled ‘Reconsidering Whether the Wire Act Applies to Non-Sports Gambling’ (issued on November 2, 2018).”
The Rules Committee will meet to consider the bill on Tuesday at 5 p.m., and the amendment is subject to a simple up-down vote. Mercifully, that doesn’t leave any room for a broader discussion of the Wire Act.
While the amendment won’t affect the scope of the law itself, it would effectively prevent the DOJ from enforcing its new opinion.
Passage would sweep the legs out from any plans the department has to target regulated US online gambling operations. Three states currently have legal online poker industries, and two more are on the waiting list pending launch. Two of those also offer full-scale casino gambling online, and another six sell lottery tickets over the internet.
Lotteries have been the primary source of pushback, with the new opinion threatening even multi-state retail games, like Powerball. Only six US states do not have a lottery program.
Perhaps the DOJ didn’t have the best read on the landscape when it published the opinion in January. The response was sharp and immediate, headlined by a lawsuit in the US District Court of New Hampshire.
So far, the federal government is not having its way.
Judge Paul Barbadoro ruled in favor of the NH Lottery Commission earlier this month, setting aside the 2018 interpretation. Comments during arguments and another deadline extension indicate that the DOJ isn’t done fighting, but Barbadoro’s ruling represents a strong shot across the bow.
Michigan was among the many states and agencies that joined the suit as amici of the plaintiffs, looking to protect its own MI online lottery. The online gambling trade group, iDEA Growth, also joined the fight, as did the North American Association of State & Provincial Lotteries representing nearly every state.
Meanwhile, the attorneys general of New Jersey and Pennsylvania filed their federal lawsuit to enforce a request made under the Freedom of Information Act. The DOJ has, so far, refused to release documents pertaining to the potential influence of Sheldon Adelson on the new opinion.
Adelson, a Republican mega-donor and online gambling end-boss, is widely perceived to be behind the department’s new stance.
Here’s the Congressional filing:BARR_021 Amendment613191056245624