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SOURCE-FULL STORY
To mark the 50th Anniversary of the World Series of Poker (WSOP), Caesars Interactive Entertainment announced a schedule for nine online “gold bracelet” events to coincide with this summer’s tournament at the Rio in Las Vegas.
WSOP.com has hosted online events for the last five years, offering prize money and lucrative buy-ins – up to $10,000 a seat – to live poker events taking place during the eight-week-long tournament that garners watchers from around the world.
One question looms.
Will Caesars legally be able to offer WSOP.com come June?
The website – one of only two legal Internet gaming portals in Nevada – could be shut down or substantially diminished following the recent opinion on the federal Wire Act offered by a branch of the U.S. Department of Justice (DOJ).
On Jan. 15, the DOJ’s Office of Legal Counsel released a 23-page memorandum concerning the 58-year-old law and reversed a 2011 opinion, which had said the act only pertained to sports gambling.
If implemented, the new opinion could apply the Wire Act to any form of gambling information where routing of the data – through various methods including the Internet – crosses state lines. Mobile sports wagering on wireless smartphones, for example, can bounce off towers in multiple states between a Nevada customer’s device and a sportsbook’s server.
Lawyers for Greenberg Traurig’s Global Gaming Practice wrote on Jan. 23 that the new opinion allows the Justice Department “to criminally prosecute a gambling business for knowingly using a wire communication facility” to transmit information.
Legal experts and gaming analysts have said the opinion would wipe out seven years of gaming technological advancements — not just Internet gaming, which is offered in just three states. Wide area progressive slot machine networks such as Megabucks, mobile sports wagering, and the sale of online lottery tickets could all come to sudden halt.
For now, the Justice Department is operating under a moratorium that delays any implementation of the opinion until April 15.
But the ruling has left the gaming industry at a standstill. Publicly, Nevada gaming leaders have taken a wait-and-see approach until the Justice Department makes a final determination. Some quietly hope new U.S. Attorney General William Barr – a state’s rights advocate – will simply opt not to enforce the opinion, just as the department doesn’t opt to prosecute for simple possession of marijuana.
Chris Grove, an analyst with Eilers & Krejcik Gaming, said he doesn’t believe the Department of Justice will ultimately enforce the opinion. He cited several reasons, including “a deep schism” among industry experts as to what the opinion could ultimately accomplish. There is also a belief in the legal community that the opinion won’t survive a judicial challenge.
“It’s an opinion, it’s not the law,” said one Nevada gaming insider. “The gaming industry is laying low. We don’t want to ask a question that we don’t want to know the answer to.”
The Washington, D.C.-based American Gaming Association issued a statement encouraging the Justice Department to “investigate and shut down illegal, unregulated gambling operators.” A spokesman for slot machine developer International Game Technology, which operates Megabucks, said the company “couldn’t provide insight on the Wire Act at this time.”
Caesars, which owns the World Series of Poker and WSOP.com, also declined to comment.
William Hill US CEO Joe Asher, whose Nevada-based company has opened legal Sports Betting operations in several states that include mobile wagering options, said the business is still engaged in expansion efforts.
“(The opinion) hasn’t really changed what everyone has been doing yet,” Asher said. “It’s business as usual at this time.”
Nevada gaming regulators are taking a similar approach.
“We’re still reviewing the memorandum and looking at potential options,” Gaming Control Board Chairwoman Sandra Douglass Morgan said last week. She added that the agency is working with the state attorney general’s office, which serves as its legal counsel. The attorney general’s office declined comment.
Morgan said the board had not been approached by any Nevada gaming company to take any action against the Wire Act changes.
Former Control Board Chairman Dennis Neilander, now an attorney with Kaempfer Crowell, said, “I’m telling people that until the Justice Department provides further guidance, there is not much we can do.”
But don’t look for Congress to get involved in the Wire Act, said Rep. Dina Titus, D-Las Vegas.
“Most of my colleagues don’t understand this issue,” Titus said.
To mark the 50th Anniversary of the World Series of Poker (WSOP), Caesars Interactive Entertainment announced a schedule for nine online “gold bracelet” events to coincide with this summer’s tournament at the Rio in Las Vegas.
WSOP.com has hosted online events for the last five years, offering prize money and lucrative buy-ins – up to $10,000 a seat – to live poker events taking place during the eight-week-long tournament that garners watchers from around the world.
One question looms.
Will Caesars legally be able to offer WSOP.com come June?
The website – one of only two legal Internet gaming portals in Nevada – could be shut down or substantially diminished following the recent opinion on the federal Wire Act offered by a branch of the U.S. Department of Justice (DOJ).
On Jan. 15, the DOJ’s Office of Legal Counsel released a 23-page memorandum concerning the 58-year-old law and reversed a 2011 opinion, which had said the act only pertained to sports gambling.
If implemented, the new opinion could apply the Wire Act to any form of gambling information where routing of the data – through various methods including the Internet – crosses state lines. Mobile sports wagering on wireless smartphones, for example, can bounce off towers in multiple states between a Nevada customer’s device and a sportsbook’s server.
Lawyers for Greenberg Traurig’s Global Gaming Practice wrote on Jan. 23 that the new opinion allows the Justice Department “to criminally prosecute a gambling business for knowingly using a wire communication facility” to transmit information.
Legal experts and gaming analysts have said the opinion would wipe out seven years of gaming technological advancements — not just Internet gaming, which is offered in just three states. Wide area progressive slot machine networks such as Megabucks, mobile sports wagering, and the sale of online lottery tickets could all come to sudden halt.
For now, the Justice Department is operating under a moratorium that delays any implementation of the opinion until April 15.
But the ruling has left the gaming industry at a standstill. Publicly, Nevada gaming leaders have taken a wait-and-see approach until the Justice Department makes a final determination. Some quietly hope new U.S. Attorney General William Barr – a state’s rights advocate – will simply opt not to enforce the opinion, just as the department doesn’t opt to prosecute for simple possession of marijuana.
Chris Grove, an analyst with Eilers & Krejcik Gaming, said he doesn’t believe the Department of Justice will ultimately enforce the opinion. He cited several reasons, including “a deep schism” among industry experts as to what the opinion could ultimately accomplish. There is also a belief in the legal community that the opinion won’t survive a judicial challenge.
“It’s an opinion, it’s not the law,” said one Nevada gaming insider. “The gaming industry is laying low. We don’t want to ask a question that we don’t want to know the answer to.”
The Washington, D.C.-based American Gaming Association issued a statement encouraging the Justice Department to “investigate and shut down illegal, unregulated gambling operators.” A spokesman for slot machine developer International Game Technology, which operates Megabucks, said the company “couldn’t provide insight on the Wire Act at this time.”
Caesars, which owns the World Series of Poker and WSOP.com, also declined to comment.
William Hill US CEO Joe Asher, whose Nevada-based company has opened legal Sports Betting operations in several states that include mobile wagering options, said the business is still engaged in expansion efforts.
“(The opinion) hasn’t really changed what everyone has been doing yet,” Asher said. “It’s business as usual at this time.”
Nevada gaming regulators are taking a similar approach.
“We’re still reviewing the memorandum and looking at potential options,” Gaming Control Board Chairwoman Sandra Douglass Morgan said last week. She added that the agency is working with the state attorney general’s office, which serves as its legal counsel. The attorney general’s office declined comment.
Morgan said the board had not been approached by any Nevada gaming company to take any action against the Wire Act changes.
Former Control Board Chairman Dennis Neilander, now an attorney with Kaempfer Crowell, said, “I’m telling people that until the Justice Department provides further guidance, there is not much we can do.”
But don’t look for Congress to get involved in the Wire Act, said Rep. Dina Titus, D-Las Vegas.
“Most of my colleagues don’t understand this issue,” Titus said.
