Exclusive: Wire Act Ruling May Give PA Clarity to Join Multi-State Poker Compact

Pennsylvania AG Josh Shapiro was one of 26 that urged DOJ to resolve Wire Act confusion back in June 2021. At the time, state regulators said the federal law hindered online gaming.
Wire Act Ruling May Give PA Clarity to Join Multi-State Poker Compact
By
September 27, 2022

A ruling in federal district court this month may have removed the largest obstacle to Pennsylvania joining an interstate online poker compact.

Meanwhile, a spokeswoman for Pennsylvania Governor Tom Wolf confirmed he had not yet decided on whether to sign the Multi-State Internet Gaming Agreement (MSIGA) before leaving office in January.

That means the status quo is unchanged since April, when Michigan officially joined the compact. But the winds of change could be about to blow across Pennsylvania.

Oddly enough, those winds originated in Rhode Island.

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IGT Wins Wire Act Case

On September 15, District Court Judge William Smith ruled in favor of IGT in a lawsuit the company filed against the Department of Justice (DOJ) last November. The lawsuit and ruling came from US District Court for the District of Rhode Island.

At issue were disparate opinions by the DOJ’s Office of Legal Counsel (OLC) under the Obama and Trump administrations over the government’s stance on the federal Wire Act. The Obama DOJ had opined in 2011 that the Wire Act only applied to sports betting, but the Trump DOJ disagreed in 2018.

Smith ultimately ruled in favor of IGT. It was the latest court ruling in favor of the industry to state unequivocally that the Wire Act applied only to sports betting. Attorneys who specialize is US gaming law add that the matter should be settled — an appeal is possible, but is considered extremely unlikely.

Ruling Should Provide Clarity

Resolution of the case in favor of IGT should have provided the clarity that officials in the Keystone State have wanted.

Pennsylvania Attorney General Josh Shapiro was one of 26 who wrote to US AG Merrick Garland in June 2021 — five months before IGT filed suit — urging him to clarify the DOJ’s position on the Wire Act.

At the time of the AGs’ letter, the state’s gaming regulator, the Pennsylvania Gaming Control Board (PGCB), had adopted a stance where it did not consider the Wire Act case settled — even after the US Court of Appeals for the First Circuit ruled in January 2021, on the same day Biden took office, that the Wire Act applied only to sports betting.

PGCB spokesperson Doug Harbach told Pennsylvania Gaming Review at the time that the board believes “the effort for clarification on this issue from our AG and those in other states to be helpful to the industry and to the Commonwealth of Pennsylvania.” He declined to speculate further.

But the fact that Shapiro signed on to a letter that specifically had the Wire Act in the crosshairs — and which made the point early on that “many states relied on [the Obama DOJ’s] position to allow online gaming to proceed” — illustrate PGCB fears that the Wire Act isn’t a settled matter.

“We are confident that the recent court decisions will be repeated in other jurisdictions throughout the US,” Harbach said Tuesday. “However, with that said, no court with jurisdiction over Pennsylvania has decided the issue, so it would be premature to say it is settled here.”

Wolf Leaves Office in January

Wolf spokeswoman Elizabeth Rementer told Pennsylvania Gaming Review in April that the governor “continues to monitor how the expansion of online gaming in recent years has affected the gaming industry and Pennsylvania residents.” On MSIGA, she said Wolf “continues to review the agreement.”

That situation was unchanged in late May, and then again this month.

But she declined to say whether Wolf — a Democrat whose last day in office is January 17, 2023 — would decide on MSIGA before leaving office or leave it to his successor.

Shapiro is the Democratic candidate for governor, while Doug Mastriano is the Republican running for the office. Neither have made any comments about the gaming compact on the campaign trail — MSIGA is not an issue in the election.

If it were to join MSIGA, then PA online poker apps could connect to existing player pools in New Jersey, Nevada, Delaware and Michigan. The latter is currently going through this process now; the first operators are expected to connect their MI and NJ player pools in the coming weeks.

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