New Hampshire Federal Court Finds Wire Act Is Limited to Gambling on Sporting Events

By: Ifrah Law

On June 3, 2019, Judge Paul Barbadoro of the United States District Court for the District of New Hampshire issued a 60-page opinion holding that the Wire Act is limited to sports gambling.  Judge Barbadoro’s opinion resolved litigation between the New Hampshire Lottery Commission, its service provider (NeoPollard), and the Department of Justice (DOJ), over a 2018 opinion by the DOJ’s Office of Legal Counsel (OLC) regarding the scope of the Wire Act.  In the 2018 opinion, the DOJ reversed its 2011 reasoning and found that the Wire Act applied to all gaming activity, not just sports wagering.  As part of the Wire Act litigation, Ifrah Law represented and argued on behalf of the iDevelopment & Economic Association (“iDEA”) as an amicus on the side of New Hampshire and NeoPollard.

Judge Barbadoro analyzed the legislative history of the Wire Act—dating to its passage in 1961—to find that the Wire Act is limited to sports gambling, reasoning that the Congressional record “tends to subvert rather than support the Government’s interpretation of the statute.”

In the opinion, Judge Barbadoro found that the OLC’s 2018 opinion was “mistaken” and the proper remedy is to “set aside” the 2018 opinion under the federal Administrative Procedures Act.  The decision represents a win not just for New Hampshire and NeoPollard, but for the iGaming industry as a whole, including iDEA’s membership.  Although this decision is likely to be appealed to the First Circuit Court of Appeals (and then, perhaps, to the Supreme Court), iGaming industry stakeholders can take comfort in Judge Barbadoro’s unequivocal holding: “I hereby declare that § 1084(a) of the Wire Act, 18 U.S.C. § 1084(a), applies only to transmissions related to bets or wagers on a sporting event or contest. The 2018 OLC Opinion is set aside.”

As a result of setting aside the 2018 OLC opinion, the status quo is restored such that the OLC’s 2011 determination that the Wire Act is limited to being applied to wagering on sporting events is once again the correct interpretation.  The OLC released its 2011 opinion in response to inquiries from the states of New York and Illinois, which were seeking to expand their lottery operations to the internet.  Following the 2011 OLC opinion, in addition to many states moving to expand their lottery operations to the internet, states like New Jersey moved to allow for expanding online poker and online casino offerings.  It is our hope that given the New Hampshire court’s decision and the restoration of the reasoning in the 2011 OLC opinion, additional states will observe the success of iGaming in New Jersey and pass legislation making iGaming available more broadly.

To read Judge Barbadoro’s full opinion, click here: Wire Act Summary Judgment Opinion