New Jersey Takes On the DOJ

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Many of the American states are at loggerheads with the federal government over online gambling. The states aver that they have the right to sanction and implement an intra-state online gambling regime, whereas the US Department of Justice (DoJ) claims that even intra-state gambling is illegal under federal law. Now the ante has been raised with New Jersey Senator Raymond J. Lesniak writing a letter to the US Attorney-General Eric Holder. The letter spells out in detail why the DoJ stance is incorrect.

The letter states that the State of New Jersey should not be impeded in any manner from exercising its rights under its state constitution and under federal law. Lesniak defended his claim that the 2006 Unlawful Internet Gambling Enforcement Act (UIGEA) permitted intra-state online gambling by citing the specific passage in the law's text. The passage is "The term 'unlawful Internet gambling' does not include placing, receiving, or otherwise transmitting a bet or wager where...the bet or wager is initiated and received or otherwise made exclusively within a single State."

Lesniak also averred that the intermediate routing of Internet network traffic across state lines by Internet service providers did not violate the provisions of either the UIGEA or the Wire Act. The UIGEA is categorical in stating that intermediate routing did not affect the location of the bet. Lesniak wrote that the Wire Act was intended for criminal enterprises that used telecommunications networks to conduct illegal interstate sports betting. The Wire Act was not intended for state-licensed and regulated intra-state online gambling.

Lesniak's letter was in response to the one written to the Attorney General by senators Harry Reid and Jon Kyl demanding that the DoJ crackdown on attempts by several states to pass intra-state online gambling legislation. Lesniak contradicted the claim made by Reid and Kyl that intra-state online gambling was illegal. Lesniak pointed out that if the view held by Reid and Kyl is accepted then the DoJ would have to prosecute the Nevada Gaming Board, which this year approved sports betting via mobile Internet within the confines of the state of Nevada. Nevada has also approved other forms of online wagering such as casino games, poker and sports betting within Nevada by firms like Las Vegas Sands and Station Casinos. Lesniak added, "New Jersey and 37 other states would also have to be prosecuted for permitting online wagering on horse races, which has existed for years."

Lesniak was one of the main sponsors of New Jersey's proposed sports betting and online gambling legislation that was approved by a large majority in the state legislature. Governor Chris Christie vetoed the bill and prevented New Jersey from becoming the first American state to legalize online gambling. Lesniak has not given up on this mission and will be introducing a new online gambling bill later this year.

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