Published: 02/15/2019 10:08:39 PM
Modified: 02/15/2019 10:08:53 PM
CONCORD – A legal opinion from the US Department of Justice that could threaten online gambling and state-run lotteries is being challenged in court by the state of New Hampshire and the company that supports its iLottery system.
In a reversal from 2011, the department issued an advisory in November reinterpreting the federal wire law, which was enacted in 1961 to target crowds and prohibit interstate betting. Under the Obama administration, the department said online gambling in states that does not involve sporting events would not violate federal law, but in the November notice, officials said the law s ‘applies to any form of gambling that crosses state borders.
This has raised concerns about the viability of multi-state online poker deals, as well as state lotteries, and lawyers for the department have acknowledged in their view that it is subject to challenge in the courts. This happened on Friday, when the New Hampshire Lottery Commission filed a lawsuit in federal court saying the opinion subjects its employees to lawsuits, creates uncertainty as to whether it should go out of business and could cost the company. ‘State more than 90 million dollars a year.
Only a small portion of that total comes from the âiLotteryâ platform the state launched in September and is expected to bring in $ 4 million to $ 6 million in the fiscal year that begins in July. But the broadest interpretation of the opinion would ban all lottery-related activities that use the Internet, Attorney General Gordon MacDonald argued in the complaint. This includes the transmission of data to backup servers installed in other states.
New Hampshire law requires that all net lottery profits be used to fund education. Since 1964, this has amounted to over $ 2 billion.
“Today New Hampshire is taking action to protect public education,” Governor Chris Sununu said in a statement. âDOJ’s opinion puts millions of dollars in school funding at risk, and we have a responsibility to stand up for our students. ”
The lawsuit calls the opinion arbitrary, capricious and abuse of discretion and cites a 1991 United States Supreme Court opinion regarding the 10th Amendment to say Congress must clarify its intention when legislating. in areas traditionally regulated by states.
“There is no indication in the plain language of (the Wire Act), its structure, purpose, or legislative history of any clear intention by Congress to ban state-run lottery activity. MacDonald wrote. âIf Congress wishes to criminalize the interstate transmissions necessary for the operation of state-run lotteries, it must do so in clear and unambiguous language. Congress did not do this in the Wire Act.
The Justice Department declined to comment.
Nevada, New Jersey, and Delaware legalized online gambling after the 2011 advisory, and all three states have agreements allowing poker players to compete online across the states. Pennsylvania became the fourth state to legalize online casino gambling in 2017. New Hampshire is one of at least nine states that allow the purchase of lottery tickets online, according to NeoPollard Interactive, which provides the materials and iLottery Software of New Hampshire and filed a similar complaint.
The company’s lawyer, Matthew McGill, called the Justice Department’s opinion an “illegal act.”
“This opinion would be subject to criminal prosecution for a crime which two courts of appeal, including the first circuit, have qualified as lawful,” he said in a statement. âThis is a scandalous and dangerous usurpation of authority. “