The conclusion to the Wire Act lawsuit in New Hampshire is still pending. However, we can now rest easy that any retaliation from the Department of Justice is not coming until 2020, if at all.
Online Poker Report obtained a recent memo Deputy Attorney General Jeffrey Rosen sent to staffers about enforcement of the new Wire Act opinion issued earlier this year. In it, Rosen instructs staff to delay enforcement until the start of 2020 or 60 days after the court case is resolved, whichever comes later.
This is not a permanent resolution for gaming groups. Nonetheless, it is a reason to exhale for the next six months. Moreover, it provides some clarity about tomorrow’s June 14 enforcement deadline that previously loomed large over gambling operations.
New deadline doesn’t mean gambling free for all
Before you go and celebrate too much, this doesn’t mean online gambling can exist without concern from now to January. Rather, the DOJ is choosing not to prosecute during this window. The memo is clear about that:
Providing this extension of the forbearance period is an internal exercise of prosecutorial discretion and does not create a safe harbor for violations of the Wire Act. All other provisions of the January 15, February 28, and April 8, 2019 memoranda remain in effect.
In other words, the DOJ is standing by its new Wire Act interpretation. It is just refraining from enforcing this new interpretation until 2020. That means anything the DOJ perceives to be a violation is still a violation. The groups incurring them simply won’t have to deal with the ramifications of that violation until later on down the line.
For groups like WSOP.com, which already has a three-state shared liquidity deal, it means they can continue this compact and face comparable potential legal action in the future. For a state like Pennsylvania considering joining that online poker compact, regulators might wait until there is closure in the case before moving forward with such a change.
Keep in mind as well that enforcing the Wire Act when it comes to sports betting is still on the table, as even the 2011 opinion on the law concedes it applies to this particular activity.
How does this affect PA online gambling?
As mentioned, don’t expect the notoriously conservative PA regulators to expand the scope of PA real-money online gambling beyond the law. Operators will still abide by the plans they turned into the PA Gaming Control Board (PGCB) in order to be in compliance with the DOJ. This means servers will stay in Pennsylvania, for example.
There is also no more concern about a potential DOJ crackdown slowing or stopping Pennsylvania’s online casino launch. The July 15 launch date is still in play. In fact, the stay on prosecution only makes it all the easier for PA casinos to meet that deadline.
The online lottery is similarly unconcerned about ceasing operations in the wake of DOJ action. Of course, the PA Lottery still has to worry about the injunction trying to bring down online instant games at the state level.
Ultimately, the action from the DOJ indicates they are not throwing in the towel on the Wire Act case yet. However, they do understand that trying to enforce these sweeping changes with the legal action pending is a headache no one wants to deal with right now.