- An argument raised by Ifrah Law in its representation of iDEA suggests an interpretation of the Wire Act that allows for state-authorized internet gaming even if data crosses state lines.
- One potential path forward is for to bring operations under the guise of state lotteries.
- A more liberal interpretation of the Wire Act could allow for all state-approved online gambling to exist under federal law.
The successful implementation of the US Department of Justice’s latest opinion on the Wire Act has been widely viewed as being the end of multi-state shared liquidity pools for online poker in the US. But an argument in the court fight opposing the new stance shows that there may be some daylight between the DOJ’s current position and the existence of interstate liquidity pools.
The current position of the DOJ is that most online gambling that crosses state lines is explicitly prohibited by the 1961 Wire Act, a divergence from the previous opinion that the Wire Act applied only to sports betting. Such a broad application of the law could mean the end interstate online poker and other forms of online gambling that cater to people in multiple states such as popular lottery games like Powerball. Even games that are only available to players within a particular state could be in jeopardy if the flow of data related to the offering of or transactions related to those games inadvertently strays across state borders in the normal routing of internet traffic.
But an argument raised by Ifrah Law in its representation of iDevelopment and Economic Association (iDEA), a US online gaming industry advocacy organization, in the pending legal battle pushing back against the DOJ suggests that an interpretation of the Wire Act that allows for state-authorized internet gaming even if data crosses state lines could serve the intent of the law and allow the industry to grow in a legal, regulated manner.
