Online Gambling Law

OddsShark.com Bitten by New Jersey Gambling Marketing Laws

February 20, 2019 by David Klein

February 20, 2019

gambling-marketing — Gambling Marketing Laws

On February 6, 2019, Mr. David Rebuck, Director of the New Jersey Division of Gaming Enforcement (the “Division” or “NJDGE”), notified Oddsshark.com and its operators that their promotion of illegal gaming sites violated Federal, and New Jersey State gambling marketing laws. In response to the notification, Oddsshark.com has posted an “ACCESS DENIED” message that appears when New Jersey State residents visit the website. Because of its violation of the New Jersey Casino Control Act and federal law, the Division has advised that civil and/or criminal action against OddsShark.com remains a possibility and warned that all New Jersey casinos and Internet gaming sites must cease doing business with them.

How do Internet gaming affiliates avoid the same fate as Oddsshark.com? [Read More]

Justice Department Releases Wire Act Opinion Letter

January 21, 2019 by David Klein

January 21, 2019

The Office of Legal Counsel for the United States Department of Justice (“DOJ”) has released an opinion updating the DOJ’s interpretation of the federal Wire Act. The new Wire Act opinion letter expands the scope of the Wire Act’s interstate prohibitions as they have existed since 2011. However, given the potentially drastic impact that it would have upon a burgeoning gambling industry, the DOJ has indicated that it will delay implementing the new opinion for 90 days to allow those in the industry to review their operations and make necessary adjustments.

What are the major anticipated effects of the Wire Act opinion letter?

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Federal Sports Gambling Bill Expected Soon

December 10, 2018 by David Klein

December 10, 2018

According to recent reports, Utah Senator Orrin Hatch has drafted a bill intended to create a framework for federal sports gambling that he will introduce before the current legislative session ends. Readers of this blog will recall that on the eve of the 2018 football season, Senator Hatch, an original author of the Professional and Amateur Sports Protection Act (“PASPA”), gave a floor speech foreshadowing that such a bill was in the works in the wake of the Supreme Court’s landmark ruling striking down PASPA.

What are the main components of the draft federal sports gambling legislation?

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NY Daily Fantasy Sports In Jeopardy After Gambling Ruling

November 1, 2018 by David Klein

By Zachary Zagger.

Law360 (October 31, 2018, 5:16 PM EDT) — A New York state court’s recent ruling that daily fantasy sports contests are gambling exposes operators like DraftKings Inc. and FanDuel Inc. to legal risks that were thought to be resolved and may force the companies to lobby for an amendment to the state constitution to save their businesses in the Empire State.

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Indiana Supreme Court Rules Against Student Athletes in Fantasy Sports Rights of Publicity Case

October 29, 2018 by David Klein

October 29, 2018

In a landmark decision, the Indiana Supreme Court has ruled that student athletes do not have a right of publicity basis to prevent fantasy sports companies from using their names, pictures and/or statistics without the athletes’ consent under the State’s statute.

Why did the Court find no preemptive right of publicity for athletes featured in fantasy sports contests?

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Sports Gambling Marketing in New Jersey

October 3, 2018 by David Klein

October 3, 2018

In June 2018, legal sports betting in New Jersey became a long-awaited reality. There are currently eight online/mobile platforms offering sports gambling in New Jersey. To generate business through sports gambling marketing, the sportsbooks utilize the services of affiliates (i.e., entities and individuals involved in promoting, marketing, and directing business to online sports gambling websites). The New Jersey Division of Gaming Enforcement (“DGE”), led by its Commissioner, David Rebuck, has regulated online gambling operators and affiliates in New Jersey since the commencement of online gaming in November 2013, which now includes online sports gambling within the State. In order to comply with the DGE’s regulations, licensed sportsbooks must only use licensed affiliates and these affiliates must only promote sportsbooks that are also licensed with the State.

The Rules for Sports Gambling Marketing

According to the DGE’s Director Advisory Bulletin published in June 2015 (the “2015 Bulletin”), “illegal online gaming sites which accept wagers from players in New Jersey pose a significant threat to the regulation of lawful gaming.” It follows then that affiliates of online gaming operators who also market illegal gaming websites pose a similar (and/or greater) threat to the regulation of lawful gaming in New Jersey. Indeed, in 2014, the DGE sent cease and desist letters to affiliates that were promoting unauthorized online gaming sites. A spokesperson for the DGE explained that where an affiliate is promoting both legal and illegal gaming, “this may either taint legitimate sites by associating them with the illegal ones, and conversely may lend the appearance that these illegal sites are affiliated with authorized sites.”

What else did the 2015 sports gambling marketing bulletin warn affiliates about?

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FTC Obtains Sweepstakes Sponsor Asset Freeze

September 20, 2018 by David Klein

September 20, 2018

In February of this year, the Federal Trade Commission (“FTC”) and Missouri State officials brought charges against a network of Kansas City area businesses (“Defendants”) which allegedly had used deceptive sweepstakes and other prize mailers to bilk consumers out of more than $100 million. The complaint alleges that Defendants sent prize notices to consumers, claiming that they had won a prize and, in order to receive that prize, consumers would have to pay an acquisition fee of anywhere from $11.89 to $139.99. Additionally, Defendants sent mailers to consumers, offering cash prizes if they could answer a simple arithmetic question and pay a registration fee of anywhere from $9 to $45. In reality, answering the arithmetic question entered consumers into a contest that had multiple rounds of mathematical puzzles, which required additional fees, and eventually ended with a puzzle that very few people, if any, could solve.

In July of this year, a federal judge had frozen the assets of the Defendants because he believed that the state and federal governments were likely to prevail on the merits of the case. Defendants were back in court last week to ask a federal judge in Kansas City to increase their living expenses from $18,000 a month to roughly $45,000 a month. The judge was not persuaded by their arguments and has ordered the Defendants’ assets to remain frozen.

How can I run a legitimate sweepstakes or contest promotion? [Read More]

SEC Settles Lawsuits Against Nevada Sports Betting Funds

September 12, 2018 by David Klein

September 12, 2018

The Securities and Exchange Commission (“SEC”) recently settled two lawsuits against sports betting funds which the agency accused of violating the Securities Act. The settlement culminates a nearly two-year investigation, and the first known prosecution of a sports betting fund since Nevada legalized such pooled wagering.

What were the nature of the SEC’s allegations against the sports betting funds?

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