Getting Up To Speed In The Wire Act Case: Ball Back In NH Lottery Court

Posted on January 14, 2020 - Last Updated on January 15, 2020

It’s been a hot minute in the never-ending litigation of the Wire Act case.

To get you up to speed, on Friday, Dec. 20, with less than an hour before the deadline, the Department of Justice (DOJ) filed an opening brief of its appeal. The appeal follows from the US District Court in New Hampshire, siding with online gambling and its vendors.

The ruling set aside the 2018 memorandum by the DOJ’s Office of Legislative Counsel (OLC). That OLC “opinion” sought to expand the scope of the Wire Act to cover all forms of gambling.

In addition, the Coalition to Stop Internet Gambling (CSIG) filed a new amicus brief in support of the DOJ. Recall that the CSIG is funded by Sheldon Adelson, a staunch opponent of online gambling. The National Association of Convenience Stores (NACS) joined with the CSIG as well.

Background of the Wire Act

The DOJ’s latest appeal is to a lawsuit filed in February 2019 by the New Hampshire Lottery Commission (NHLC) and NeoPollard Interactive LLC, the lottery’s service provider.

Then, in June 2019, US District Court Judge Paul Barbadoro sided with gambling interests. Specifically, the 60-plus page opinion found in favor of online gambling, lotteries and casinos and against the Department of Justice’s new Wire Act interpretation.

Barbadoro shared in his ruling that the case would likely reach the US Supreme Court on appeal. Later and true to his words, the DOJ filed a notice of appeal to the First Circuit in August. Thereafter, the government filed for an extension to file its appeal brief, moving the deadline to late December.

Lastly, the DOJ released yet another memo stating the Wire Act enforcement is delayed until 2020 or when litigation concludes.

DOJ continues its fight

To begin with, the DOJ continues to push on with the argument that NHLC and NeoPollard lacked standing to sue over the OLC’s Wire Act memo.

Recall that parties need to have the standing to sue. This means that parties need to show that they have received “harm” in order to bring suit. Although the court rejected this argument in June, the DOJ is doubling down on this argument and indeed, focusing even more heavily on it during the appeal.

Also, the DOJ argues that the 2018 OLC memo did not constitute “final agency action.” Because it is not “final,” the court in New Hampshire cannot set aside the opinion and prevent enforcement, it argues.

According to Andrew Silver, an associate at Ifrah Law, the DOJ’s push on “standing” and “final agency action” is “interpreted to be an admission that [the DOJ] knows that its arguments about the scope of the Wire Act are weak.” Ifrah Law represents the iDevelopment and Economic Association in the Wire Act litigation.

Amicus brief filed by CSIG

The latest addition to the case is an amicus brief or “amicus curiae” filed by Adelson-backed CSIG, along with the NACS.

As defined by Cornell Law’s Legal Information Institute, an amicus curiae can be explained as follows:

Frequently, a person or group who is not a party to an action, but has a strong interest in the matter, will petition the court for permission to submit a brief in the action with the intent of influencing the court’s decision.

These briefs have become increasingly common over the past several decades, according to Columbia Law School. In fact, amicus briefs appeared in every one of the 63 US Supreme Court cases in the 2017-18 term.

The CSIG brief presents five legal arguments, mostly dealing with pushing for interpretation that the Wire Act decision would apply to state entities, in addition to private ones.

Online Poker Report further explains the five arguments, none of which appear particularly convincing:

  1. To whom does the Wire Act apply?
  2. What exactly does “person” mean?
  3. A person can be considered a public or private entity.
  4. The history of the Wire Act supports application to states.
  5. The Wire Act does apply to state employees and state vendors.

How could the brief affect the Wire Act case?

For right now, there is not much that the brief does or does not do. Amicus curiae briefs do seem to argue or highlight standpoints that are, at times, distinctly different from the main party’s arguments.

For example, as previously stated in our coverage of the Wire Act judgment, the state of Michigan filed an amicus curiae. In their brief, Michigan argued that should another state shutter its lottery offerings such as Powerball (multiple states participate to drive up the large jackpot), that overall lottery revenues would decline, hurting New Hampshire’s revenue. Barbadoro stated in his ruling that he would be willing to entertain this claim, New Hampshire did not raise the issue.

Although amicus curiae briefs do sometimes present strong or different legal arguments, it remains unclear how this brief will affect the overall litigation of the Wire Act.

Looking ahead

From here, it is up to New Hampshire and the lottery providers to file a brief in response to the DOJ’s latest arguments. An extension moved the original deadline of Jan. 21 to Feb. 26.

Because the DOJ’s appeal focuses primarily on legality — on whether the NH lottery had grounds to sue — a DOJ court victory would not necessarily mean a victory for the 2018 OLC Wire Act interpretation. Rather, it would merely put the DOJ back to the beginning, with an opinion that is difficult to enforce.

It is likely that no matter what occurs in the future that none of the parties will be backing down. If the DOJ attempts to enforce their interpretation that the Wire Act applies to all forms of gambling following this case, they will likely face more court battles.

No matter what the First Circuit finds, there is a high likelihood that a Supreme Court petition will follow.

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Vanessa Lutz

Vanessa Lutz graduated from Washington and Lee University School of Law with a J.D. She played poker professionally and then took some time off to have a family. Now she is combining her experience as a contributor to PlayPennsylvania.

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