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DOJ Asserts Wire Act Opinion Doesn’t Cover Lotteries

In an effort to side-step the lawsuit filed against it by the New Hampshire Lottery (and others), the DOJ asserts that it recent reinterpretation of the Wire Act doesn’t apply to lotteries. As we previously reported, the New Hampshire Lottery has sued the Department of Justice (DOJ) to prevent enforcement of the DOJ’s opinion (issued in January 2019) reinterpreting the Wire Act. As we also reported, the January 2019 DOJ opinion reversed the position it took in 2011 that the entirety of the Wire Act is limited to sports betting. The new opinion concluded that only one of four parts of the Wire Act apply to sports betting, while the other three apply to any online betting.

In support of its motion to dismiss the lawsuits, the DOJ argued that its recent opinion did not address whether or not lotteries are subject to the Wire Act’s prohibitions. As a result, the DOJ argued that the declaratory judgement actions should be dismissed for lack of standing (due to no reasonable apprehension of suit by the DJ plaintiffs).

One of the attorneys for the plaintiff was quoted as saying:  “Desperate to avoid judicial review of its radical reinterpretation of the Wire Act, DOJ now is backtracking from the clear import of the reversal of position that it supposedly had so carefully considered,” and “DOJ’s eleventh-hour statement that it may — or may not — further revise its interpretation of the Wire Act only underscores the arbitrariness of the reversal of DOJ’s long-held position that the Wire Act addresses only sports betting activities.”

Copyright © 2019, Sheppard Mullin Richter & Hampton LLP.

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Jim Gatto is a partner in the Intellectual Property Practice Group in the firm's Washington, D.C. office. He is also Co-Team Leader of the firm's Digital Media Industry and Social Media and Games Industry Teams, Blockchain Technology and Digital Currency team, and Team Leader of the firm's Open Source Team. 

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