New Hampshire Federal Judge Strikes Down DOJ Wire Act Interpretation

Published June 11, 2019 by Elana K

New Hampshire Federal Judge Strikes Down DOJ Wire Act Interpretation

US District Judge Paul Barbadoro has overturned the DOJ's interpretation of the 1961 Wire Act that bans interstate online gambling, poker, and lotteries in addition to sports betting.

Online gamblers, rejoice. A New Hampshire federal judge has overturned the expanded interpretation of the 1961 Wire Act that includes interstate online gambling, poker, and lotteries in its nationwide ban. US District Judge Paul Barbadoro ruled that the Wire Act only applies to interstate sports betting, not gambling.

Deja vu?

If you feel like you’re having deja vu, you’re not alone. The interpretation of the Wire Act has been the subject of debate for decades, but in 2011, the Assistant Attorney General Virginia Seitz ruled that the Wire Act applies only to sports betting; this paved the way for early adopter states, including Delaware, New Jersey, and Nevada, to launch online gambling.

As other states passed legislation and more continued to seriously consider legalizing online gambling, the Office of Legal Counsel in the US Department of Justice came out with a surprise opinion in January 2019, essentially reversing the 2011 opinion and reverting to the old interpretation of the Wire Act, which bans all forms of interstate gambling, not just sports betting.

There is a lot of speculation as to the source of this opinion that seemingly came out of nowhere. Most pro-online gambling lawmakers pointed fingers at Sheldon Adelson, the notoriously anti-online gambling casino tycoon. The New Jersey attorney general even filed a lawsuit against the Department of Justice for failing to hand over information regarding Sheldon Adelson and the recent crackdown on legal online gambling.

New Hampshire's Legal Action

New Hampshire is another state that did not take the 2019 reinterpretation lying down. After the DOJ's announcement in January, the New Hampshire Lottery Commission sued to return to the broader interpretation of the Wire Act. The state currently operates interstate lottery sales and stands to lose more than $90 million in annual revenue if lottery sales are banned. New Jersey, Pennsylvania, and Michigan backed New Hampshire in the lawsuit.

What Does the New Ruling Mean for Online Gambling in the U.S?

Judge Barbadoro’s ruling is certainly a victory for New Hampshire, but what about other states? Matthew D. McGill, who represents NeoPollard Interactive, the company that operates New Hampshire’s online lottery, said the ruling will impact other states as well.

“Because the court ‘set aside’ the Justice Department’s incorrect re-interpretation of the Wire Act, this ruling has nationwide impact,” he said. “Throughout the country, state lotteries and others in the gaming industry once again can rely on the Justice Department’s 2011 opinion that the Wire Act is limited to sports betting.”

We'll see if the DOJ agrees with him.

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