Well, when it comes to the Wire Act, it appears the Department of Justice is still full of surprises.
Just days before both the DOJ and the New Hampshire Lottery are set to meet in court, DOJ reps filed new evidence that could get the case dismissed.
In the motion, filed Monday, the DOJ presented a few pieces of evidence. Some are old Wire Act correspondence from when the law was first passed in 1961.
The real stunner though is a recent memo authored by Assistant Attorney General Rod Rosenstein to DOJ employees. In it, he directs them to not apply the recent Wire Act interpretation to state lotteries once the enforcement deadline hits on June 14.
New lottery memo quite the surprise
Online Poker Report first reported the memo yesterday. The new memo certainly comes as a surprise given that there was no mention whatsoever of lotteries being exempt from the new interpretation. Moreover, the memo spent pages adamantly insisting the law covered every single form of betting and wagering.
Nonetheless, here are Rosenstein’s instructions, direct from the memo:
The OLC opinion did not address whether the Wire Act applies to State lotteries and their vendors. The Department is now reviewing that question. Department of Justice attorneys should refrain from applyingSection I 084(a) to State lotteries and their vendors, if they are operating as authorized by State law, until the Department concludes its review. If the Department determines that the Wire Act does apply to State lotteries or their vendors, then Department of Justice attorneys should extend the forbearance period for 90 days after the Department publicly announces this position. This would allow State lotteries and their vendors a reasonable time to conform their operations to federal law.
As the memo notes, the issue of whether or not state lotteries violate the Wire Act is still up in the air. Given that the popular draw games like Powerball and Mega Millions use the internet to pool the money across a couple of dozen different states. Certainly, when it comes to the subject of interstate transactions, there is a case to make that Powerball violates the Wire Act. particularly when you consider the new opinion suggests just about every other type of gambling does.
What does this mean for the DOJ suit?
This late addition to the evidence appears to be a move by the DOJ to get the suit thrown out of court. If it does not apply to lotteries, then the NH Lottery arguably does not have the standing to file suit.
The oral arguments will proceed as scheduled on April 11. At that point, the court could give a better indication of how this new paperwork is received.
This memo does more than just threaten the NH Lottery’s case though. It also threatens the entire fight against the new Wire Act opinion. Dustin Gouker, who authored the Online Poker Report story explained on Twitter:
This appears to be an attempt to kneecap the current litigation in New Hampshire, and to limit the scope of the Wire Act memo just to online casino/poker, and to keep the case from moving forward in the First Circuit Court of Appeals, where there's unfriendly precedent.
— Dustin Gouker (@DustinGouker) April 8, 2019
Managing Director of Eilers and Krejcik Gaming Chris Grove elaborated on the scope beyond just the scoop:
Starting to seem like the fix is in here. Carving out lotteries would be 100% arbitrary but would knock one of the most powerful advocates out of the box, leaving commercial online gambling to fend for itself. https://t.co/LM61SSQSac
— Chris Grove (@OPReport) April 8, 2019
In other words, this throws everything into question about the new DOJ Wire Act opinion. And for the next two days, all we can do is wait.