Wire Act Plays Out in Federal Suit, Online Gaming at Stake

A lawsuit filed by lottery officials against a 2018 Department of Justice ruling that makes online gambling across state lines illegal continues to wind its way through U.S. appellate courts. The ruling regarding the Wire Act of 1961 reverses a 2011 decision that limited the scope of the act to sports betting.

Wire Act Plays Out in Federal Suit, Online Gaming at Stake

The United States Court of Appeals for the First Circuit has set the briefing schedule for both the Department of Justice (DOJ) and the plaintiffs in the lawsuit over the Wire Act and its applicability to online gambling.

The First Circuit said Attorney General William Barr and the DOJ needs to file their briefs and other necessary paperwork by November 12.

The New Hampshire Lottery Commission along with the other state lotteries and vendors that joined the suit have 30 days to respond after the DOJ files its brief. The DOJ’s reply brief is then due within 21 days after the plaintiffs respond, according to Online Poker Report.

The issue began with an opinion in 2011 at the request of New York and Illinois state lotteries to narrow the scope of the Wire Act. The opinion stated that the Wire Act applies only to sports betting across state lines but not other forms of gambling.

But a DOJ memo in 2018 expanded the interpretation to include all online play, and indicated that online gambling vendors and state lotteries now risk federal prosecution under this new interpretation. New Hampshire filed a federal lawsuit due to the DOJ’s abrupt about-face regarding the Wire Act. In June, U.S. District Court Judge Paul Barbadoro ruled in favor of online gambling and state lotteries by finding that the Wire Act only applies to sports betting and not other forms of interstate online gambling.

The DOJ filed a notice of appeal to the First Circuit in August. Meanwhile, the DOJ released another memo stating that Wire Act enforcement is postponed until 2020 or when litigation concludes on this case.

Once the briefs and motions are all filed, the First Circuit will then sets a date for oral arguments. Arguments occur before a panel of three judges. Oral arguments normally occur the first full week of each month, so the court could schedule them as soon as the first week of January 2020.

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