New Hampshire Plaintiffs Respond to DOJ in Wire Act Case

New Hampshire Plaintiffs Respond to DOJ in Wire Act Case

The Wire Act case took a step forward this week when the plaintiffs filed their briefs with the US Court of Appeals for the First Circuit. The New Hampshire Lottery Commission (NHLC) filed its brief with the court, as did NeoPollard Interactive LLC and Pollard Banknote, the appellees that serve as the software providers for the NHLC’s online lottery business.

As happens in these situations, the process has moved rather slowly.

With this step completed, however, there is only one step before the case is put into the hands of the US Court of Appeals. That step is a final response from the US Department of Justice, which is due 21 days from the date of the plaintiffs’ filings. The due date is now set for mid-March for the last brief.

Timeline to Latest Briefs

The exact meaning of the 1961 Wire Act didn’t become a contentious issue until the 2011 Justice Department under the Obama Administration took a closer look at it and its meaning. Its Office of Legal Counsel then determined what was long assumed, that the Wire Act pertained to only sports betting, not to online lotteries or internet gaming.

Numerous states legalized and began running internet lotteries. Nevada legalized online poker, New Jersey and Delaware allowed online casino games and online poker, and Pennsylvania did the same in 2017.

In late 2018 and early 2019, all of that was threatened by the Trump Administration, as its DOJ reversed the 2011 decision in November 2018.

–January 14, 2019: Wire Act opinion becomes available to the public

–January 16, 2019: Deputy AG Rosenstein issues 90-day delay on application of interpretation

–January 18, 2019: Media report links Adelson to DOJ decision

–February 5, 2019: State Attorneys General (NJ and PA) threaten legal action

–February 15, 2019: New Hampshire Lottery Commission files lawsuit against DOJ

–February 15, 2019: NeoPollard (NH online lottery platform provider) files lawsuit against DOJ

–February 27, 2019: iDEA Growth files lawsuit against DOJ

–March 4, 2019: Rosenstein extends application of Wire Act to June 14, 2019

–April 11, 2019: US District Court for District of New Hampshire hears oral arguments

–April 11, 2019: Judge Paul Barbadoro predicts case will reach US Supreme Court

–June 3, 2019: Barbadoro rules for plaintiffs, sets aside recent DOJ Wire Act decision

–June 12, 2019: DOJ orders no application of new Wire Act memo through 2019

–August 16, 2019: DOJ and Barr file last-minute appeal in First Circuit Court of Appeals

–November 12: 2019: DOJ and Barr brief due in First Circuit but granted extension

–December 18, 2019: DOJ extends Wire Act application to June 30, 2020

–December 20, 2019: DOJ and Barr file brief in First Circuit

–January 19, 2020: New Hampshire and NeoPollard brief due in First Circuit but granted extension

–February 26, 2020: New Hampshire and NeoPollard brief due

Latest Briefs

As scheduled, the NHLC and NeoPollard each filed briefs on February 26. Both were relatively similar in nature, stating their cases for upholding the US District Court decision in their favor.

Both briefs explained in detail why the original case was justified and why the US District Court decision correctly concluded that the Wire Act pertains solely to sports betting. They each broke down the Wire Act into its separate clauses, explaining that each of them individually applies to sports betting only, as they do as a whole statute.

They also detailed the reasons that subsequent notices by the DOJ after its Wire Act reversal decision did nothing to allay fears of prosecution under that new decision.

New Hampshire Lottery Commission Argument

The NHLC made clear that the “dire operational, compliance, and criminal consequences” of the DOJ’s 2018/2019 decision made it necessary to file the original lawsuit.

The summary of its argument focused on the NHLC’s standing to maintain the action, and nothing about the DOJ’s subsequent attempts at clarification of the new Wire Act interpretation gave them any reason to assume that their online lottery business was safe from prosecution. They maintained that the interpretation posed an “impending, credible, and substantial risk” to the NHLC and its operations, not to mention the revenue and the public education and state budget problems it addresses.

“The NHLC operates a multi-million-dollar lottery business that uses the interstate wires to facilitate the placing and payout of bets or wagers, including the sale and payout of lottery tickets online. It relied on the 2011 Opinion to structure its operations.”

And in its conclusion, the NHLC maintained its standing to file the suit and that the US District Court’s decision should be affirmed.

NeoPollard Argument

The co-plaintiffs in this case argue many of the same points, but NeoPollard begins with its own assertion that oral arguments should be heard in the appeal. NeoPollard stated:

“This appeal presents an important question of statutory interpretation that implicates billions of dollars in state revenue – in New Hampshire and across the United States – and that threatens to destabilize an entire industry that has flourished in the past decade. Oral argument would aid the court in resolving the legal questions raised here.”

The summary of NeoPollard’s argument states that its declaratory-judgment claim is justiciable, and that the 2018 DOJ opinion presents a “realistic” threat of prosecution. In fact, it says that courts have held that “’the existence of a statute’ alone ‘implies a threat to prosecute.’”

Ultimately, the document reads, the 2018 DOJ opinion “must be set aside if it is ‘not in accordance with law.’” And NeoPollard believes the DOJ opinion is “contrary to the law, and the district court therefore was correct to vacate the opinion.”

Next Steps

With the plaintiffs’ briefs filed, the defendants – US Department of Justice, US Attorney General William Barr, and the United States – must file a reply within 21 days. Depending upon the reading of the calendar, this puts the due date at March 18 or 19, 2020.

The three judges will then decide if they will hear oral arguments in the case or simply issue a ruling.

 

 

About Jennifer Newell

Jennifer began writing about poker while working at the World Poker Tour in the mid-2000s. Since then, her freelance writing career has taken her from Los Angeles to Las Vegas and back to her hometown of St. Louis, where she now lives with her two dogs. She continues to follow the poker world as she also launches a new subscription box company and finishes her first novel. Jennifer has written for numerous publications including PokerStars.com and has followed the US poker and gaming market closely for the last 15 years. Follow Jen on Twitter

Disclaimer: The information on this site is my interpretation of the laws as made available online. It is in no way meant to serve as legal advice or instruction. We recommend that you seek legal advice from a licensed attorney for further or official guidance.

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