Wire Act lawsuit arguments begin, DOJ tries to dismiss case

Wire Act lawsuit arguments began Thursday with the future of online gambling hanging in the balance.

DOJ and lawyers for the plaintiffs made arguments before US District Court in Concord, New Hampshire. Judge Paul Barbadoro is presiding.

The lawsuit against the Department of Justice (DOJ) was initially filed by the New Hampshire Lottery Commission. They were joined by more than a dozen other states and state organizations via amicus briefs, as well as NeoPollard, the operator of lotteries in New Hampshire.

What is the new Wire Act opinion?

Released in January this year, the DOJ’s new opinion on the Wire Act overturned previous guidance. That stated the Wire Act, which makes illegal the transmission of bets and wagers across state lines, only applied to sports betting.

The new opinion says that the Wire Act applies to all forms of gambling, not just sport betting. This new opinion is bad news for states involved in interstate lotteries, such as Power Ball. It also penalizes states that engage in interstate online poker compacts to share player liquidity.

In a further change, the DOJ announced earlier this week that the new opinion did not target interstate lotteries. A memo by Deputy Attorney General Rod Rosenstein stated that it was no threat to New Hampshire or other states that rely on interstate lotteries for tax revenue.

The change of face was seen by many as a way for the DOJ to get New Hampshire’s lawsuit tossed out. That was proven during arguments on Thursday when the DOJ tried to do just that.

They asked the judge to dismiss the lawsuit because the new opinion has no adverse effect on lotteries or the states that rely on them.

Judge Barbadoro denied their request and asked or more information from the DOJ before he would proceed. He gave the DOJ 14 days to fully determine the new reach of the Wire Act and share it with the court.

It will be interesting to see what the DOJ comes back with, how it affects the lawsuit against them, the judge’s ruling and the future of the Wire Act.