A U.S. District Court ruling that said the Wire Act only applies to sports betting not only staves off a Department of Justice effort to end interstate online poker efforts, it will also help facilitate the growth of poker gaming across the country.
Earlier this month, U.S. District Court Judge Paul Barbadoro in New Hampshire ruled on a challenge by the New Hampshire Lottery Commission that the 1961 Interstate Wire Act applies only to sports betting. Barbadoro said the opinion by the DOJ in November 2018 that the Wire Act applied to other forms of gambling is set aside.
States were supposed to comply by June 14, but the district court ruling removes that obligation for now.
That decision “represents just about the greatest win imaginable” for poker operators, wrote Mark Edelman in Forbes.
Edelman, a law professor of Zicklin School of Business in New York City focusing on issues of gaming and antitrust, said the decision “clearly supports the legality of interstate poker compacts, paving the way for online poker's further growth on a national or semi-national basis.”
So far, Delaware, New Jersey, Nevada, Pennsylvania and West Virginia have legalized online poker, with the last two now attempting to get their games up and running. The first three states had formed compacts to allow residents to compete against each other across state lines, but the DOJ reinterpretation of the Wire Act threw that plan into question.
Most immediately, Barbadoro’s ruling allows residents of Delaware and New Jersey to compete in online events at the World Series of Poker in Las Vegas, which is taking place now.
On the Ifrah on iGaming blog, Washington, D.C.-based attorney Andrew Silver called the decision a win for the industry as a whole.
“It is our hope that given the New Hampshire court’s decision and the restoration of the reasoning in the 2011 [Office of Legal Counsel] opinion, additional states will observe the success of iGaming in New Jersey and pass legislation making iGaming available more broadly,” he wrote.
While the ruling is great for poker, other casino games and lotteries, it wasn’t so hot for sports betting. Martin Harris at PokerNews points out the decision “reinforces the illegality of any interstate sports betting compacts.”
However, while larger player pools are needed to form poker games of any consequence – as operators in Nevada, New Jersey and Delaware discovered after they legalized the games – sports bets are between individuals and game operators, making interstate compacts less necessary.
Experts expect the DOJ to appeal, with the First Circuit Court of Appeals the next venue to hear the case if that happens.
Barbadoro anticipated that would happen during oral arguments, saying that, "I have a strong feeling that however I resolve the case, or however the First Circuit resolves the case, it is likely going to be resolved by the U.S. Supreme Court either way."