Gambling Industry Get 60 More Days to Comply With Wire Act Opinion

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The regulated online gambling market has been in upheaval ever since the Department of Justice reversed their opinion on the Federal Wire Act. After releasing the new opinion, they gave business across the country 90 days to bring themselves into compliance and avoid prosecution under the new opinion.

It now appears that the deadline has been extended and businesses will have until the middle of June to meet the new guidelines. Of course, this could all change depending on how things play out in court as legal challenges against the new opinion are finally making their way to court.

Non-Prosecution Window Extended 60 Days

According to an article released Thursday by Online Poker Report, the DOJ will be extending their compliance period an additional 60 days. Originally, businesses had until April 15th to meet the guidelines under the revised Wire Act opinion.

What does this mean exactly? Since many states began moving forward with plans for online gambling regulation based on the 2011 Wire Act opinion, the DOJ is giving states (and any other organizations offering online gambling in the United States) the opportunity to verify that their processes do not cross state lines.

Under the new opinion, all forms of gambling fall under the umbrella of the Wire Act, and any data that is transmitted across state lines regarding online gambling puts the sender and receiver in violation. For example, the act of transmitting a poker tournament structure across a state line could be viewed as a violation since it supports an online poker tournament.

All processes connected to online gambling must remain intrastate in order to meet new Wire Act guidelines. Businesses will now have an extra two months to fall into compliance.

Pennsylvania has delayed their iGaming launch until at least July due to the new opinion. It will also be interesting to see what other impacts that the Wire Act could have. Some speculate that the World Series of Poker may have difficulty in running online bracelet events and those events may be forced to remain solely on WSOP.com in Nevada.

Wire Act to Get Tied Up In Court

As expected, the Wire Act opinion will be directly challenged in court, and odds are that multiple lawsuits will be filed against the DOJ regarding the opinion. The New Hampshire Lottery Commission has already filed a challenge against the opinion and other states are expected to join them.

NJ Senate President Stephen Sweeney has also threatened a lawsuit against the DOJ on behalf of the NJ iGaming industry. Pennsylvania has also spoken out against the opinion.

The DOJ opinion will likely be attacked on multiple fronts. Firstly, three states already offer online gambling legally and share an interstate online poker network. The new DOJ opinion would threaten the network. However, the Wire Act opinion impacts all forms of online gambling, including online lotteries, sports betting, and more.

While we are not legal experts, there are plenty of legal experts out there stating that the new DOJ opinion will not hold up in court. For now, legal challenges will move through the First Circuit, and many feel that there are good odds that the challenge will be successful. Unfortunately, we still feel that the legal battle over the Wire Act will slow progress towards online gambling expansion in the United States in 2019. While it seems likely that Pennsylvania will get online at some point, there’s a good chance we will not see any additional states regulate online poker or online gambling outside of sports betting. Of course, a swift and successful legal battle by the iGaming industry would change all this.