"Government Comes down on Online Betting Ad"

In light of the WTO’s recent ruling regarding the position of the United States with regard to online gambling, that country has not eased up on its prohibition against online gambling. Rather than easing up, the United States Government in fact is continuing to follow a policy that penalizes any concern or organization that does business with online gambling companies. An example of this would be the U.S. Justice Department’s recent subpoena of Esquire magazine in its attempt to gain information on an online gambling site that advertised in Esquire’s April issue. The advertisement in question is an eight-page pull out regarding online poker site, Bodog.com.

The enter U.S. Government policy regarding online gambling is based on the 1960’s Wire Act. This Act prohibits the use of phone lines for making bets. According to the Justice Department, the Wire Act makes Internet gambling illegal in the United States. This means that the government is obliged to pursue anyone doing business with an Internet gambling company. That would include banks, advertisers, and payment transfer companies as well as those who operate the online gambling sites.

Since it is only an informational subpoena and not a request for editorial information, Esquire is planning to go along with the Justice Department’s subpoena. Editorial information is protected by the Constitution.

Challenges to the their United States Government’s Internet gambling policy have come from both domestic and international sources. Not long ago the North Dakota legislature headed an effort to make lawful some forms of Internet gambling. Casino City Inc., which operates CasinoCity.com, has argued that the Justice Department’s efforts to thwart Internet gambling web sites from promoting their services over the radio is a violation of commercial free-speech rights. Both of these challenges were ultimately dismissed but an international challenge posed by the WTO with regard to U.S. policy on online gambling cannot be so easily dismissed. The WTO’s ruling has stated that U.S. prohibitions on Internet gambling are discriminating against offshore gambling operators that are attempting to carry out business with U.S. consumers. The final ruling however, includes in effect, some loop holes permitting the U.S. to continue to maintain its present policy on Internet gambling. But it still presents a challenge to that policy, especially in light of the fact that the WTO plans to issue a statement that is expected to clarify its position regarding the extent of its ruling. In the mean time, it is certain that there are other advertisers will watching how things are resolved between the U.S. Justice Department and Esquire magazine.