US Department Of Justice Says Wire Act Opinion Does Not Affect Lotteries

The US Department of Justice says that its revised opinion on the 1961 wire act did not include anything about the legality of online or interstate lotteries and that a review on the matter is currently underway.

A memo from Deputy Attorney General Rod Rosenstein supports the Department’s claim, suggesting that the DOJ is still trying to determine whether or not state lottery operations should fall under the Wire Act’s jurisdiction or not. Since the determination has not been made, they maintain that there are no grounds for a legal challenge and so any such challenge brought up by any state or lottery organisation should be dismissed.

Although the DOJ’s revised opinion on the Wire Act states that the act applies to all forms of gambling and not just sports betting, the memo from Rosenstein states that Department of Justice attorneys should not enforce this new stance until the current review is formally concluded.

If the department does rule that interstate lotteries are covered by the Wire Act, Rosenstein has said that state lottery operations will be granted a 90-day window to allow them to ensure that their operations are compliant with the federal law.

This filing comes as part of an ongoing legal battle launched in the state of New Hampshire on behalf of the state lottery corporation. It is in response to a memorandum of law filed by the New Hampshire Lottery Corporation which objects to a motion to dismiss the case, filed on March 25 by the Department of Justice.

The lottery corporation, in its objection, states that the DOJ “studiously ignored” the basic question of whether or not the revised Wire Act opinion applies to state lotteries in its motion to dismiss the case. The department, however, argues that the lottery corporation cannot use legal action to force it to adopt an enforcement position. It also argues that because of the memo issued by Rosenstein there is no threat of prosecution and that the case should, therefore, be dismissed for a lack of standing.

The New Hampshire Lottery maintains that the state could lose about $90 million per year in revenue if the DOJ decides that the Wire Act does indeed pertain to state lotteries and certain games have to be withdrawn. If a ban on interstate gambling transmissions is enforced, some say sales could drop by up to 25% per year and a ban on multi-state games such as the highly popular Powerball could reduce lottery revenue by up to $80 million per year.

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