New Hampshire

New Hampshire Triumphs as Federal Judge Voids Wire Act Reversal Opinion

The State of New Hampshire and its two state-run lottery entities have triumphed in their joint lawsuit against the US Department of Justice and its controversial reversal opinion regarding the United States’ Wire Act, which posed a looming threat to interstate online gambling in the US. In an opinion published today, presiding United States District Judge Paul Barbadoro granted the New Hampshire plaintiffs’ motion for a summary judgment and set aside the Wire Act reversal opinion crafted late last year.

Judge Barbadoro offered a thorough evaluation of the arguments presented by the two sides and came down wholly in favor of the arguments presented by New Hampshire and its state-run lottery agency, Neopollard Interactive. Barbadoro wrote this in summarizing his opinion:

In summary, I deny the Government’s motion to dismiss for lack of jurisdiction because the plaintiffs have established standing, and the Government has not met its burden to show that the case is moot. I grant the plaintiffs’ motions for summary judgment and deny the Government’s cross-motion for summary judgment.

I hereby declare that § 1084(a) of the Wire Act, 18 U.S.C. § 1084(a), applies only to transmissions related to bets or wagers on a sporting event or contest. The 2018 OLC Opinion is set aside.

Judge Barbadoro’s ruling returns the status quo to that established by the late-2011 opinion on the matter authored by then-US Attorney General Eric Holder. That opinion specified that the antiquated 1961 Wire Act applies only to the interstate transmission of sports betting information. New Hampshire is one of dozens of US states that participate in interstate lottery systems such as Powerball and Megabucks, which are run from Iowa, and all of those states faced the possibility of civil and criminal sanctions had the more recent reversal opinion been allowed to stand.

The unjust nature of what the DOJ was trying to accomplish was summed up by an unnamed attorney for Neopollard Interactive, the lottery agency for New Hampshire. As Judge Barbadoro footnoted, “At oral argument, NeoPollard suggested that a declaratory judgment may necessarily be universal in effect, because ‘the idea that the law means something for the New Hampshire Lottery Commission and something for NeoPollard and something different for somebody else is not the way the criminal law in this country works.’”

The DOJ will not be able to file an appeal in Barbadoro’s court, but it will be able to appeal the ruling in the US First District Court of Appeals, should it so choose. If the DOJ appeals and loses there, all that would remain is a possible appeal to the US Supreme Court, with thin odds of reversal there.

Regulated US online poker is the extra beneficiary of today’s ruling. While other forms of online “casino game” activity feature players betting against the house, interstate transmission of wagering info is largely unnecessary. Online poker, however, needs larger player pools to survive and thrive, and today’s setting aside of the most recent DOJ opinion is great news for that. One immediate example is that of the 2019 World Series of Poker, which is offering a record eight online bracelet events this summer. The series is located in Nevada, and players on the New Jersey WSOP.com site were only able to play in the first two of the eight events, due to the uncertainty of the situation; the DOJ had issued a June 15th compliance deadline regarding its reversed opinion, though that deadline is now moot.

The WSOP has yet to issue any sort of statement regarding those post-June 15th online events, but it seems likely that New Jersey players will now be allowed to participate. That should double (or more) the fields for those bracelet events. However, even though it’s been thrown out, the reversal opinion will have a lingering effect on the new Pennsylvania online-poker market, where several of that state’s casinos were set to partner with sites in Nevada and New Jersey. All that was put on indefinite hold and will take some time to recover.

Nonetheless, today’s ruling is the best legal news for regulated US online poker in quite some time, and it’ll be interesting to see where the battle goes from here.

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