The Department of Justice (DOJ) caused concerns in 2019 after it decided to change its stance on the 1961 Wire Act and rule that it was no longer restricted to sports betting activities but would now cover all forms of online gambling.
The Wire Act was rolled out in 1961 primarily to put an end to illegal sports betting but did not specifically limit it to sports betting.
This was the legislation that the DOJ used to target online poker operators in the infamous Black Friday crackdown in 2011.
However, the DOJ would change its stance on the Wire Act and later rule that it would only be applied to sports betting and not all forms of online gaming.
This ruling from the DOJ allowed multiple states and gaming operators to enter into interstate poker compacts. Nevada and Delaware established an interstate poker agreement to join their respective poker markets and turn it into a bigger and more competitive online poker market. This worked well for both licensed poker operators and players who now had bigger prize pools and more competition.
Some states like New Hampshire did not engage in an interstate online poker compact but did allow the New Hampshire Lottery to set up its servers out of state. When the DOJ changed its outlook in 2019 on the Wire Act, it threatened online poker compacts as the DOJ once again was looking to impose the Wire Act on all forms of gambling.
The New Hampshire Lottery filed a lawsuit against the DOJ and won as a lower court ruled that the DOJ could not apply the Wire Act to other forms of gambling including interstate poker agreements. The DOJ filed an appeal with the First Circuit Court of Appeals who also ended up ruling in favour of the New Hampshire Lottery. The DOJ had time until Jan 21 to file an appeal but chose not to do so.
No More Threat To Interstate Poker
The DOJ’s decision to not pursue the Wire Act ruling anymore makes it clear that it has once again accepted its stance that the Wire Act applies only to sports betting and not all forms of gambling.
The ruling also makes it clear that interstate poker agreements are no longer under threat and interstate poker operators will be able to function as usual.