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Lesniak back to fight DOJ on Wire Act reversal

One of New Jersey’s strongest gaming advocates is prepared to fight the federal government, again, over a recent U.S. Department of Justice memo that could have serious implications for online casino operators.

Former state Sen. Raymond Lesniak, D-Union, has been asked by Senate President Steve Sweeney, D-Salem, Gloucester, Cumberland, to prepare a response to the Justice Department’s recent interpretation of the Wire Act, which reads counter to an 2011 opinion that stated the law only applied to sports gambling.

The new opinion makes the Wire Act applicable to all forms of gaming that cross state lines, such as online casino gaming, fantasy sports and online lotteries.

“The new Justice Department opinion threatens the significant boost enjoyed by New Jersey casinos, the jobs and state revenues from online gaming and it could have a negative impact on sports betting at our casinos and racetracks,” said Sweeney. “We don’t want to lose the hard-fought gains that are helping to revive Atlantic City and the state’s gaming industry.”

Online gaming has generated more than $1 billion in revenue for casino operators since 2013. In 2018 alone, online gaming accounted for more than $298.7 million in revenue for Atlantic City casinos and its 21.6 percent growth over 2017 contributed to the resort’s $2.86 billion in total gaming revenue for the year.

Lesniak sponsored the effort to legalize online gambling in New Jersey following the 2011 Wire Act opinion and led the charge (along with former Gov. Chris Christie) to allow sports betting, which wound up in the U.S. Supreme Court and resulted in the 2018 overturning of a federal ban.

“It looks like I will have to go to court again to straighten out the Justice Department’s overreaching on states’ rights, just as I did with sports betting,” said Lesniak. “This opinion is outrageous. If Congress won’t fix it, I will through the judicial process.”

Lesniak will reportedly work pro bono, according to a news release. Lesniak will seek a declaratory judgment that the opinion is contrary to the clear intent of the Wire Act.

The Justice Department has delayed implementation of the new decision for 90 days and will seek comments during that period.

The Interstate Wire Act of 1961, more commonly referred to as the Federal Wire Act, prohibits the operation of certain types of betting businesses in the United States. It was intended to assist the states, territories and possessions of the United States in enforcing their respective laws on gambling and bookmaking and to curtail organized gambling activities.

Contact: 609-272-7222 Twitter @ACPressDanzis

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