Much attention has been given to the Department of Justice’s opinion regarding the Wire Act and how it relates to online poker. Many herald the memorandum as the critical document that will lead state and federal governments to embark on the legalization and regulation of Internet gambling. Forgive the cold water of this article, but here’s the unfortunate truth: None of this is happening any time soon.
From a legal standpoint, the DOJ essentially said what all credible gaming lawyers have known for some time, which is the Wire Act applies only to sports betting and should not be relied upon as a general prohibition to Internet gambling.
Deep in the bowels of the DOJ a handful of lawyers were holding on to an antiquated interpretation that had long been rejected by federal courts. The memorandum, which was released this fall, merely was the official statement.
Now, to the politics: I sat on a panel last summer at the Global Internet Gaming Symposium and Expo in San Francisco and was asked to handicap the prospects of legal Internet gambling in the United States.
I was in the minority with senior officers from major casino companies pontificating that no later than 2013 would there be legal Internet gaming, particularly poker, in the United States. My view was that gridlock in Washington, D.C., would get worse, a Republican Congress would prevent anything from passing in 2012, and a Republican president would never sign such a measure if elected in November.
My advice to the industry was to plan to walk in the wilderness for another 5-10 years if you’re expecting the federal government to authorize Internet poker.
I felt it would have to happen at the state level, but that it wouldn’t happen in the near term by any meaningful state with the population needed to generate a truly liquid Internet poker industry.
The problem (and political reality) is the states are as dysfunctional as the federal government when it comes to tackling such an issue. Incumbent gambling operations can’t agree on how to divide the pie. For a first-hand example, look to California and the past couple of years of failed efforts to pass an Internet poker bill.
Overlay the efforts out of Las Vegas to essentially define the market players in advance so the entrenched gambling behemoths can control the pie if it’s ever served up by the federal government or even a sizable state, and you have a recipe for gridlock and status quo.
As I apologized at the beginning, sorry for the cold water, but the big news about the DOJ memo is overblown and will be forgotten in a few months. If you’re good in live games and have a favorite poker room, you can smile and know that nothing is coming soon via the Internet to take the pigeons from your table.
— Marc W. Dunbar represents several gaming clients before the Florida Legislature and teaches gambling and parimutuel law at the Florida State’s College of Law. Follow him on Twitter (@FLGamingWatch) or his website (floridagamingwatch.com).
