New Jersey has filed a brief in support of a federal lawsuit brought by New Hampshire which challenges the recent federal Department of Justice opinion on the 1961 federal Wire Act that has threatened the legality of online gambling and lotteries.
Michigan’s attorney general, with the support of 11 states and the District of Columbia, has also filed an amicus brief challenging the opinion and asking for it to be declared void. Michigan runs an online lottery.
New Jersey Attorney General Gurbir Grewal has already opposed the DOJ ruling and in an amicus brief to the New Hampshire suit, says the state is seeking “nationwide relief” from the new DOJ opinion.
“Furthermore, this Court can and should grant relief that reaches beyond the parties and the District of New Hampshire, and that protects the interests of third-parties like New Jersey nationwide,” the brief reads. “Under the Declaratory Judgment Act, the Court should declare that the Wire Act does not cover non-sports-related gambling in any jurisdiction, and under the Administrative Procedure Act, the Court should vacate the DOJ’s 2018 reinterpretation of the Wire Act as null and void.”
The DOJ recently reversed a previous 2011 opinion which held that the Wire Act applied only to sports betting. That opinion opened the door of online gambling in New Jersey, as well as Nevada and Delaware as well as allowing the rise of online lotteries.
The new opinion said the act refers to all types of gambling where information is transmitted across state lines. The opinion immediately called into question the legality of interstate online lotteries and online poker player sharing, as well as casting doubt on any online gaming where information may be sent to an out-of-state server.
New Hampshire, which has an online lottery, has challenged the opinion in federal court. The New Jersey brief, filed March 8 in the United States District Court for New Hampshire says that many states and businesses will be “imperiled” by the DOJ’s decision and that the justice department had no legal grounds to unveil such a strict interpretation.
The Michigan Lottery has also filed an amicus brief in the case through the state’s attorney general. A spokesperson for Michigan Attorney General Dana Nessel told Michigan NPR that the brief is seeking to protect state lottery revenue directed to help the state’s schools and students. The Michigan brief was joined by 11 states and the District of Columbia.
The brief states that the new opinion makes erroneous legal conclusions and demonstrates the need for nationwide equitable relief to combat potential consequences.
The DOJ, meanwhile, has delayed any implementation of the opinion until June to allow the gaming industry to adjust to the interpretation.
Grewal and Pennsylvania Attorney General Josh Shapiro have both alleged that Las Vegas Sands CEO Sheldon Adelson—who has personally financed a lobbying effort to ban online gaming in the U.S.—was behind the reinterpretation. Published reports have suggested that the wording of the opinion was provided to the DOJ by Adelson-backed lobbying firms.
Both attorneys general have filed a federal Freedom of Information Act request in February with the DOJ to determine whether the opinion was issued to appease Adelson, who is a major Republican donor.
Shapiro also filed to have Pennsylvania join the New Hampshire suit as a co-defendant, but the district court ruled it had no jurisdiction over Pennsylvania law. Judge Paul J. Barbadoro, however, said the state was free to also file an amicus brief.
“The future of New Jersey’ online gaming industry is at stake because of DOJ’s unlawful about-face regarding internet gaming—activity that DOJ promised us was perfectly legal just eight years ago,” Grewal said in a press statement. “We will not stand by and let this arbitrary, politically-driven reinterpretation destroy a vibrant and essential industry here in our state.”
New Jersey, according to the brief, would lose “funding from taxes and fees, hundreds of jobs for its citizens, the secondary gains to its economy from the development of new in-state businesses of jobs.”
