U.S. District Court Confirms Federal Wire Act Applies only to Sports Betting Activities

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NeoPollard Interactive LLC and New Hampshire Lottery have been thrilled by the U.S. District Court decision which confirms that the federal Wire Act applies only to sports betting activities. This decision is important for the U.S. lottery industry as a whole as it alleviates concerns pertaining to the transmission of lottery data over the Internet, whether in connection with traditional retail or online lottery sales.

The Wire Act subjects to criminal liability any person who “knowingly uses a wire communication facility for the transmission in interstate or foreign commerce of bets or wagers or information assisting in the placing of bets or wagers on any sporting event or contest, or for the transmission of a wire communication which entitles the recipient to receive money or credit as a result of bets or wagers, or for information assisting in the placing of bets or wagers.”

In January 2019, OLC released a new opinion concluding that the Wire Act extended beyond the sports-betting context to criminalise the interstate transmissions of all bets or wagers, whether or not they are sports-related—thereby reversing the conclusions of the 2011 opinion and threatening to shut down the burgeoning iLottery industry.

Working alongside the New Hampshire Lottery Commission, NeoPollard Interactive and Pollard Banknote, the New Hampshire Lottery’s technology providers, immediately sought a declaratory judgment in federal court that the OLC’s new Wire Act interpretation was based on an incorrect reading of the statute.

By concluding that the Wire Act applies only to transmissions related to bets or wagers on a sporting event or contest, Judge Paul Barbadoro safeguards the New Hampshire Lottery and NeoPollard Interactive from the threat of unlawful prosecution in New Hampshire, Michigan, and in each other U.S. state where NeoPollard Interactive operates.

“We are very happy with the recent judgement regarding the interpretation of the Wire Act. This is a great success for the Lottery industry generally and iLottery specifically, as it ensures that the sale of both iLottery games and national and regional multi-state games across all sales channels can continue to be strong contributors to lottery sales and the good causes that lotteries in the United States support. In terms of iLottery, we know first-hand the positive effect that these operations have not only on sales, but on the overall player experience. We look forward to continuing to provide state-of-the-art iLottery products and strategies to lotteries as they explore new, interactive sales channels,” Doug Pollard, Co-Chief Executive Officer of NeoPollard Interactive said.

“We are pleased that not only will our national and regional multi-state game sales carry on, but also importantly that our own relatively new yet highly successful iLottery operations will be able to continue. Since the launch of our iLottery program last year, we have seen an increasingly positive response from our players, resulting in higher returns to education programs in New Hampshire. We are grateful for the leadership and support from the New Hampshire Attorney General’s Office, NeoPollard Interactive and Pollard Banknote in this highly complex matter. We are excited to continue our strong partnership with NeoPollard Interactive to provide entertaining online products that deliver an enhanced play experience to all our customers,” Charlie McIntyre, Executive Director of the New Hampshire lottery said.