Relevant 1st Amend. case decided in Nevada last week ?

[MiltonFriedman]

A recent US District Court case struck down a ban on advertising brothels in Clark County and Washoe County. Briothels are legal in other Nevada Counties, but not in Clark or Washoe. (Las Vegas is in Clark County.) If anyone has a copy of the decision, by Judge Mahan last week, could they post a link ? (The Plainitffs included the ACLU and City Life, a sister subsidiary to the Las Vegas Review Journal.)

Apparently, even tho operating a brothel is illegal in Clark County, a Nye County brothel could still advertise there. This is analogous to Nevada casinos advertising out of State.

Why is this good ? ... (I would want to see the decision itself) However, it clearly fits in with the argument that a ban on internet gaming in some States, (and a Federal bootstrap thereof) would violate the right to conduct business in less restrictive States. In fact, an advetising ban, which would block advertising in the "Illegal" States would violate the business' right.

(Again, if anyone has the decision, a link would be appreciated.)

[damaniac]

I don't know why this would be that broad. It would seemingly protect advertising for internet gambling in states where it is banned (although I'd want to search Westlaw for some case law on this), but I don't know why this would apply to gaming itself. The gaming would almost certainly be considered commercial activity, not speech (someone's going to say: "But an argument could be made that..." No, sorry. The courts won't find that internet gambling is a form of speech. I don't care if you think it should be; it isn't in the court's eyes and that's whose opinion matters).

Again, I'd want to see the opinion too, but there is a substantative right to free speech, not so to commerce (not since Lochner died, anyway). And of course this a district court. So until an appellate court makes such a statement in a published case, it doesn't mean much in terms of precedent (though would be hopeful that other courts could find that way).

[Bilgefisher]

I'm not a lawyer, so pardon my confusion. Wouldn't a brothel and online gaming fall into the commerce category and have little to do with free speech? It seems the brothel case would open some doors for any other business. Advertising liquor in a dry county or in our case poker in a non gambling county. The only thing I wonder, isn't commerce laws within a state much different then commerce laws between states?

Sorry guys, gotta put it in laymen terms for us non-lawyer types.

[renodoc]

wow- when do the billboards go up? that will mess up traffic.

[Legislurker]

It could be awesome news in terms of fish recruitment. Unfettered television commercials for .com sites that can say legal on them if they are legal(or not illegal) anywhere. Im not Malthusian on the poker pie, but every commercial(or even a billboard) is more $ in my virtual pocket.

[MiltonFriedman]

"[T]here is a substantative right to free speech, not so to commerce "

There is clearly First Amendment protection for commercial speech. You are wrong on that point. (The problem is that government burdens imposed upon commercial speech are just not subject to as strict a standard of scrutiny.)

[Russ Fox]

There's lots of case law on what's legal as far as commercial speech. (Note: I'm not an attorney, but I used to be a consultant in the telecommunications industry, so I had to know this information.) The test used for deciding whether commercial speech is legal is the "Central Hudson Test" after Central Hudson Gas & Elec. v. Public Serv. Comm'n, 447 U.S. 557 (1980). (The case is here.) (http://caselaw.lp.findlaw.com/cgi-bin/getcase.pl?court=us&vol=447&invol=557)

There are two recent Supreme Court cases that looked at casino advertising. The first is Posadas de Puerto Rico Assoc. v. Tourism Company of Puerto Rico, 478 U.S. 328 (1986). (http://www.bc.edu/bc_org/avp/cas/comm/free_speech/posadas.html) The second case is Greater New Orleans Broadcasting Association, Inc., et al. v. United States et al (http://www.law.cornell.edu/supct/html/98-387.ZS.html). In both cases the Supreme Court ruled that casinos can advertise where casino gambling is legal but cannot advertise where casino gambling is illegal. In the Greater New Orleans case, the court held that a New Orleans television station that could be watched in Texas can accept advertisements for casino gambling but a Texas station cannot.

As a practical matter this means that given the US government's position that all Internet gambling is illegal, and the fact that the FCC regulates all broadcast media in the US (except satellite communications, which are regulated by the FTC), no broadcast media station today will accept advertisements for a .com Internet site, and this will not be changing any time soon.

-- Russ Fox

[damaniac]

[ QUOTE ]
"[T]here is a substantative right to free speech, not so to commerce "

There is clearly First Amendment protection for commercial speech. You are wrong on that point. (The problem is that government burdens imposed upon commercial speech are just not subject to as strict a standard of scrutiny.)

[/ QUOTE ]

Sure, but running an internet gambling site is NOT commercial speech. Advertising it, yes, running it, no.

[JPFisher55]

Actually the situation could be changing within the next year. The DOJ can state that all online gambling is illegal, but we will see what the judge in the iMEGA case rules. That case may take some time since I doubt that iMEGA will obtain their TRO. However, the judge could grant the final injunction requested in their original petition.

[MiltonFriedman]

Thanks for the Sup Ct. cases. My reasoning is as follows:

1. The basic premise is that online poker is not illegal everywhere in the US. Hypothetical State A does NOT outlaw it and there is no Federal law which outlaws it.

2. As with the Greater New Orleans casinos, an online site wants to advertise on the Internet to residents of State A.

3. As expected, the advertisements, meaning the online dot.com site offering downloadable clients, can be seen in State B.

Can the Greater New Orleans, and possibly the new Nevada case, would support an argument that the laws of State B cannot be relied upon by the Federal government to ban advertisment via the Internet by the online poker company ... so long as there is a State A where it is not illegal to play ?

A similar analogy would apply to prohibiting the depositing of money by State A residents. (In order to tailor the UIGE Act Regs to an appropriate constitutional scope, would they need to identify which States are A or B and carve out the A States ?)

[Russ Fox]

[ QUOTE ]
The basic premise is that online poker is not illegal everywhere in the US. Hypothetical State A does NOT outlaw it and there is no Federal law which outlaws it.


[/ QUOTE ]
Unfortunately, the USDOJ currently holds the opposite opinion--that federal law today does outlaw all Internet gambling. This view has been stated many times, including the letters by the DOJ to North Dakota and Nevada (when they were considering laws on Internet gambling). And a broadcaster, holding a license from the federal government, has no choice but to obey the views of the DOJ. The risks of fines and even the potential of losing the license are too high. Whether the DOJ's view is correct or not is irrelevant when the US government holds all the cards.

If and when a state has legal intrastate online gambling, I believe at that time it would be legal for an in-state broadcaster to air advertisements for said site, with appropriate disclaimers.

-- Russ Fox

[JPFisher55]

Federal case law exists that holds that federal law only outlaws sports betting. Even the Neteller case was a sportsbetting case.
I agree that the threat of prosecution has chilled legal advertising of online gambling. Which is why I hope that iMEGA wins its case. I don't think that even the Bush DOJ would violate a court ordered injunction; well I hope not.

[tangled]

[ QUOTE ]
[ QUOTE ]
The basic premise is that online poker is not illegal everywhere in the US. Hypothetical State A does NOT outlaw it and there is no Federal law which outlaws it.


[/ QUOTE ]
Unfortunately, the USDOJ currently holds the opposite opinion--that federal law today does outlaw all Internet gambling. This view has been stated many times, including the letters by the DOJ to North Dakota and Nevada (when they were considering laws on Internet gambling). And a broadcaster, holding a license from the federal government, has no choice but to obey the views of the DOJ. The risks of fines and even the potential of losing the license are too high. Whether the DOJ's view is correct or not is irrelevant when the US government holds all the cards.

If and when a state has legal intrastate online gambling, I believe at that time it would be legal for an in-state broadcaster to air advertisements for said site, with appropriate disclaimers.

-- Russ Fox

[/ QUOTE ]


I am so shocked by your post that I am wondering if there is some brilliant nuance that I am missing.

The DOJ does not interpret law, they enforce it. The courts interpret law and so far they have said that the Wire Act does not apply to poker.

It is "revelant" if the DOJ is correct in their opinion of the federal legality of online poker.

You make it sound as if the DOJ has never been contradicted by the courts, and so it is futile to ever challenge their opinion.

[Zobags]

[ QUOTE ]
You make it sound as if the DOJ has never been contradicted by the courts

[/ QUOTE ]

But they are rarely contradicted by large media outlets.

[Russ Fox]

[ QUOTE ]
The DOJ does not interpret law, they enforce it. The courts interpret law and so far they have said that the Wire Act does not apply to poker.

[/ QUOTE ]
You are, of course, correct--courts interpret the law. And in the only appeals court ruling to date, the Fifth Circuit ruled that online poker was not illegal (in re Mastercard ).

So what.

Assume, for the moment, that you hold a broadcast license. You have received a letter from the DOJ stating that if you broadcast any advertisements for any online gambling .com website, you will be fined, and could face further punishment (including loss of your broadcast license). Would you accept any advertisements from a .com site?

Those letters were sent to every media group (NAB, etc.) and to media outlets that had aired online gambling advertisements a few years ago. Some media companies have received fines and/or have had to forward monies received for such ads to the government--the DOJ is not making an idle threat.

Broadcasters hold licenses from the US government. The US government says that accepting such ads can cost you your license. Until the government changes that policy, no broadcast medium will be airing advertisements for any .com sites. No broadcaster will engage in a Pyrrhic battle that could cost them their license.

-- Russ Fox

[JPFisher55]

[ QUOTE ]
[ QUOTE ]
The DOJ does not interpret law, they enforce it. The courts interpret law and so far they have said that the Wire Act does not apply to poker.

[/ QUOTE ]
You are, of course, correct--courts interpret the law. And in the only appeals court ruling to date, the Fifth Circuit ruled that online poker was not illegal (in re Mastercard ).

So what.

Assume, for the moment, that you hold a broadcast license. You have received a letter from the DOJ stating that if you broadcast any advertisements for any online gambling .com website, you will be fined, and could face further punishment (including loss of your broadcast license). Would you accept any advertisements from a .com site?

Those letters were sent to every media group (NAB, etc.) and to media outlets that had aired online gambling advertisements a few years ago. Some media companies have received fines and/or have had to forward monies received for such ads to the government--the DOJ is not making an idle threat.

Broadcasters hold licenses from the US government. The US government says that accepting such ads can cost you your license. Until the government changes that policy, no broadcast medium will be airing advertisements for any .com sites. No broadcaster will engage in a Pyrrhic battle that could cost them their license.

-- Russ Fox

[/ QUOTE ]

Mr. Fox is right. This "chilling affect" is the basis for the harm cited by iMEGA in its lawsuit against AG Gonzales.
It's sad when the Justice Department will not honor federal case law precedence.

[MiltonFriedman]

You are kind of missing the point.

The First amendment discussion is not limited to broadcasting licensees under the FCC jurisdiction.

The Nevada case involved newspapers, the internet sites are hosted on the internet, there are a slew of advertising and marketing options which are not under the FCC jurisdiction. The FCC and its licensees are at best a footnote to this discussion.

[MiltonFriedman]

Mr. Fox's point is inapposite to the discussion. (As for whether it is correct, that is debatable at best, as broadcasters did air Dot.Net ads for years following the DOJ letters.)

[MiltonFriedman]

Your hopes for iMEGA winning an injunction will be dashed, given the relief they are after .... . Their chances are less than those of hitting a 1 outer. (I would be delighted to be proven wrong.)

[JPFisher55]

[ QUOTE ]
Your hopes for iMEGA winning an injunction will be dashed, given the relief they are after .... . Their chances are less than those of hitting a 1 outer. (I would be delighted to be proven wrong.)

[/ QUOTE ]

I agree concerning their request for a TRO. But I disagree about their prayer for a final injunction. I think their constitution arguments are strong. Their original petition is better than their recent brief.
The biggest problems that I see for iMEGA in their lawsuit are standing and ripeness issues.
All we can do is wait and hope for the best.

[MiltonFriedman]

Standing issues are fatal, in my view. Likelihood of success on the merits is near zero, as they need to show some LAWFUL activity is impacted, i.e. poker, and some US persons' rights are infringed. (It is highly unlikely that a Judge in New Jersey is going to enjoin the Federal government, especially in favor of an unlicensed, unregulated industry. An unlicensed, unregulated industry is an anathema to New Jersey, why the suit was brought there and not elsewhere in the 3d Ciruit is beyond my understanding. Even Nevada would have been better, as it is eager to get into the online gaming industry and has favorable 1st Amendment Federal judges.

[Skallagrim]

I have to agree that the questionable strategic decisions about how to bring this lawsuit are most likely going to mean that its handful of good legal issues are not likely to be reached.

The real way to bring this lawsuit is to first find the perfect plaintiff: a pro online player in a state with legal regulated B&M poker, home poker, and no online specific laws. California is that state. Nevada is second best because it does have an internet law (one that is almost certainly unconstitutional, but its there). This pro could clearly demonstrate that his ability to earn a legitimate living is likely to be negatively affected. Now thats standing...and you get the 9th Cir. Court of Appeals.

But who knows, maybe these guys know something I dont.

Skallagrim

[JPFisher55]

[ QUOTE ]
I have to agree that the questionable strategic decisions about how to bring this lawsuit are most likely going to mean that its handful of good legal issues are not likely to be reached.

The real way to bring this lawsuit is to first find the perfect plaintiff: a pro online player in a state with legal regulated B&M poker, home poker, and no online specific laws. California is that state. Nevada is second best because it does have an internet law (one that is almost certainly unconstitutional, but its there). This pro could clearly demonstrate that his ability to earn a legitimate living is likely to be negatively affected. Now thats standing...and you get the 9th Cir. Court of Appeals.

But who knows, maybe these guys know something I dont.

Skallagrim

[/ QUOTE ]

This is my fear also. I think that it is sound on the merits, but weak on standing and ripeness issues. If it can get to the merits then I think its odds are 50%, but I doubt it will reach the merits. OTOH maybe Doyle Brunson or the owners of Full Tilt are members of iMEGA.