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Lottery lawsuit looms over budget writing

March 30, 2019 GMT

CONCORD, N.H. (AP) — New Hampshire lawmakers are writing the state budget without knowing whether they can rely on a key source of revenue, but the state attorney general hopes the question will be settled soon in court.

The New Hampshire Lottery Commission sued the federal government last month over the U.S. Department’s recent re-interpretation of the federal Wire Act, which was enacted in 1961 to target the mob and prohibits interstate wagering. In 2011, during the Obama administration, the department said online gambling within states that does not involve sporting events would not violate federal law. But officials reversed that in November, saying the law applies to any form of gambling that crosses state lines.

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That raised concerns about the viability of multistate online poker agreements, as well as state lotteries like the one in New Hampshire, which is projected to bring in $192 million in the next two years.

While only about $5 million a year of that total comes from the “iLottery” platform the state launched in September, the broadest interpretation of the opinion would prohibit all lottery-related activities that use the internet, Attorney General Gordon MacDonald argued in the complaint.

A judge will hear the case April 11, MacDonald told lawmakers Tuesday, and he expects a ruling by the end of May. Lawmakers have until the end of June to pass a two-year state budget.

“In view of this important revenue item to the budget, we’ve made clear to the court that we respectfully would like an answer to the questions we posed in time for this body to make a decision,” he said.

NeoPollard Interactive, which provides New Hampshire’s iLottery hardware and software, joined the lawsuit as a plaintiff, and the states of New Jersey, Michigan and Pennsylvania filed briefs in support. But in their response to the lawsuit filed Friday, attorneys for the U.S. Department of Justice argue that the federal court lacks jurisdiction because the plaintiffs are seeking an advisory opinion about a law.

“The heart of the plaintiffs’ claim in this case is not that the government is threatening to do something that would violate their constitutional rights, but rather that they disagree with the government about whether a federal criminal statute applies to certain commercial wagering activity,” the lawyers wrote.

They also argued that the plaintiffs showed no evidence that they are at imminent risk of prosecution.

Nevada, New Jersey and Delaware legalized online gambling after the 2011 opinion, and the three states have agreements allowing poker players to compete online across the states. Pennsylvania became the fourth state to legalize online casino gambling in 2017. New Hampshire is among at least nine states that allow lottery tickets to be purchased online.