New Hampshire is taking the fight to the US Department of Justice over its recently revised opinion regarding the Federal Wire Act to the effect that it applies to all forms of online gaming, not solely sports betting. The state believes that the new opinion effectively renders its internet lottery illegal which, in turn, will have a significant impact on lottery sales, money from which goes to fund public education.
The move to mount a full legal challenge was confirmed in the following statement: “State Governor Chris Sununu, Attorney General Gordon J MacDonald, and New Hampshire Lottery Executive Director Charlie McIntyre have now confirmed that the New Hampshire Attorney General’s office filed a complaint on behalf of the New Hampshire Lottery Commission with the United States District Court for the District of New Hampshire challenging the United States Department of Justice (DOJ) opinion that the 1961 Wire Act applies to lottery sales over the Internet.
The complaint itself is reads as follows: “The plaintiff, the New Hampshire Lottery Commission, seeks declaratory and injunctive relief against the defendants, William Barr, in his official capacity as the Attorney General of the United States Department of Justice, and the USDOJ under the Declaratory Judgment Act, 28 U.S.C. § 2201, and for violations of the Administrative Procedure Act (“APA”), 5 U.S.C. §§ 701-706.”
Sununu explained: “Today New Hampshire is taking action to protect public education in New Hampshire. The opinion issued by DOJ puts millions of dollars of funding at risk, and we have a responsibility to stand up for our students.”
“The New Hampshire Lottery has a responsibility to support education in New Hampshire,” New Hampshire Lottery Executive Director Charlie McIntyre said. “Just last year, the New Hampshire Lottery generated $87.5m in net profits, all of which supports education in New Hampshire, and we expect to generate more than $90m for education this year. This reversal by DOJ puts that support for education in question.”
The State has also filed a Motion for a Speedy Hearing Pursuant to Federal Rule of Civil Procedure 57, and Local Rule 7.1(f). “By this action,” it said, “and through its Motion for Summary Judgment, the NHLC seeks immediate declaratory relief under the federal Declaratory Judgment Act and immediate relief under the federal Administrative Procedure Act to prevent the defendants from extending their new, erroneous interpretation of a criminal statute, 18 U.S.C. § 1084, to state-conducted lotteries.”
Since 1964, the New Hampshire Lottery has had a significant financial impact on the state. For the past 54 years, the New Hampshire Lottery has recorded more than $6.6bn in lottery sales and other earnings, with over $4.4bn paid in prizes and other cost of sales. Net proceeds to education total over $2bn to date.
SBCA takeway: Whatever the DoJ was thinking when it reversed its opinion of the Wire Act is anyone’s guess, but this was only ever going in one direction, towards a court of law. New Hampshire – and for that read every state lottery provider – will likely have reviewed that new opinion with utter disbelief bordering on disdain. The Wire Act was already an anachronistic piece of legislation – an analogue sledgehammer to crack a digital nut. And in the wake of the DoJ’s questionable revision, this law is now looking more like an ass with every passing day.