In the wake of the order by the Minnesota Department of Public Safety to 11 internet service providers (ISPs) calling for the blockage of 200 internet gaming domain names, the Interactive Media Entertainment and Gaming Association (iMEGA) has struck back.
iMEGA sent a letter of its own to ISPs, which states, “iMEGA wants you to know that it believes that the Notice lacks any legitimate foundation in the law and requests that you not block access to the websites identified.” The Department of Public Safety charged that ISPs were in violation of the Wire Act of 1961, which has traditionally applied to online sports betting. Nevertheless, USA-friendly online poker sites such as Bodog, Full Tilt Poker, and Players Only were among the 200 affected. Also coming under fire were a number of online poker rooms that do not accept U.S. customers, such as Everest Poker, Titan Poker, and CD Poker. The former is even the on-felt sponsor of the 2009 World Series of Poker (WSOP) in Las Vegas, which begins later this month from the Rio.
iMEGA asserts that the Wire Act “simply does not apply to website operators and imposes no duty upon you to comply with the Minnesota Department of Public Safety’s request.” The question of whether multi-faceted companies such as Verizon and Comcast, which offer residential home telephone service, high-speed internet, and cable television, constitute “common carriers” as outlined by the Wire Act was also addressed. To answer it, iMEGA quoted a Congressional statement: “It is the policy of the United States… to preserve the vibrant and competitive free market that presently exists for the internet and other interactive computer services, unfettered by Federal or State regulation.”
iMEGA charges that the Minnesota Department of Public Safety is overstepping its bounds, noting that ISPs have been asked to “block access to certain websites by your Minnesota end-users even though these websites are not located within Minnesota.” The trade organization also warns that, prior to blocking a site, ISPs must provide written notice to their customers of any service changes. The letter questions whether the Department of Public Safety’s request entails a violation of the Commerce Clause of the United States Constitution or a “blatant” trampling of First Amendment rights.
For ISPs that are unfamiliar with the internet gambling industry in the United States, iMEGA’s letter points out, “The Notice shows evidence of selective enforcement insofar as the list of websites identified is not exhaustive. The website list is also inaccurate insofar as it lists some websites that are not accessible by Minnesota end-users and other websites that are defunct.” In addition, it questions why Time Warner Cable, which provides internet services to Minnesota residents, was not among the 11 companies that received notices.
John Fleischaker of Dinsmore and Shohl LLP’s Louisville office sign the letter. ISPs were expected to respond within two to three weeks of receiving the Minnesota Department of Public Safety’s notice. In addition to the aforementioned online poker sites, the casino arms of Ladbrokes and Party Gaming are also listed; publicly traded companies on the London Stock Exchange own both sites. Party Gaming yanked its online poker site, Party Poker, from the U.S. market shortly after the 2006 passage of the Unlawful Internet Gambling Enforcement Act (UIGEA). The company has even signed a non-prosecution agreement with the U.S. Government. One of its co-founders, Anurag Dikshit, admitted to violating Federal law and is in the midst of paying a $300 million fine.
Today, Congressman Barney Frank (D-MA) introduced legislation outlining a comprehensive licensing and regulatory framework for the internet gambling industry that focuses on consumer protections. In addition, the Massachusetts lawmaker and Chairman of the House Financial Services Industry introduced legislation to delay the implementation of UIGEA regulations by one year to December 1st, 2010.