Earth Fund to Have Its Day in Court

10 January 2002

The fate of the Earth Fund lottery's effort to raise money for the environment via the online sale of lottery tickets will be decided in two weeks by the Prince Edward Island Court of Appeal.

The hearing will take place Jan. 29-30 and will address the issues that were brought up by a legal application filed by the Interprovincial Lottery Corp. in September 2000.

"It's not a gripe with the Earth Fund at all."
-Lynne Roiter
Interprovincial Lottery Corp.

E. Marshall Pollock, president of Lottery Management (PEI) Inc., which operates the Earth Future Lottery for the Earth Fund, said the original application made against the Fund by the Interprovincial Lottery Corp. was adjourned with no date set to take up the matter further. The hearing in two weeks will involve the government of Prince Edward Island asking the Court the same thing the Interprovincial Lottery Corp. asked for judgment on in its application: whether Prince Edward Island has the authority to give a charity such as the Earth Fund a license to sell lottery tickets online.

The executive director of the Earth Fund, Stephanie Foster, said the Interprovincial Lottery Corp. didn't want the Earth Future Lottery selling tickets online because it would compete with its business. The lottery organization is a consortium of the five regional provincial lotteries in Canada.

"They were saying that we would pose unfair competition--I don't think they used the word monopoly, but I think they think they've got one," Foster said. "I think they also might have tried to claim that we didn't have a jurisdiction or legality, and we're going through all those motions now."

"We already know the Interprovincial Lottery Corp. doesn't want [the Earth Fund to get clearance] because they think it might compete."
- E. Marshall Pollock
Lottery Management (PEI) Inc.

The Interprovincial Lottery Corp. has intervened in the current reference before the courts to make its arguments known to the court. The attorneys general for Prince Edward Island, Quebec and Canada, as well as charities that are potential beneficiaries of the Fund, have also been granted intervener status.

"Six or seven parties have intervened; that's why the hearing is scheduled for three days," Pollock said.

Lynne Roiter, chairwoman of the Interprovincial Lottery Corp., said the attorneys general of Canada and Quebec are in agreement with her organization that the issuing of an online lottery license to the Earth Fund is a violation of Canada's criminal code. Roiter said the Interprovincial Lottery Corp.'s only issue with the Earth Fund is that it believes the lottery's license is illegal.

"It's not a gripe with the Earth Fund at all," Roiter said. "There is a criminal code in Canada, and the interpretations that we give to the dispositions of the criminal code would render this type of operation to be not in conformity with the criminal code. In our reading of the criminal code, charities are able to do charities within a province but they are not able to sell outside the province; they are not able to sell using electronic devices or computers."

Pollock, on the other hand, said he thinks the Interprovincial Lottery Corp.'s motives for intervening in the hearing are related to competition in the lottery business.

"We already know the Interprovincial Lottery Corp. doesn't want it because they think it might compete," he said. "The issue is whether there is authority in the criminal code for the province to issue this kind of license."

Pollock said he didn't think it would be illegal for the Interprovincial Lottery Corp.'s member lotteries to get licenses to sell tickets online, but that those organizations already have access to distribution means that are out of the Earth Fund's grasp.

"They (the Interprovincial Lottery Corp.) have a distribution system that the charities couldn't afford to have, and it's only the Internet, the public communication system, that the charities can afford to take advantage of," he said.

Pollock predicts the hearing will result in the Earth Fund keeping its license because, he said, all that's required of the site is that the lottery be conducted, managed and operated in Prince Edward Island. If the server is located there, those stipulations are met, he said.

"We obviously feel pretty confident, our lawyers have looked at the provisions of the criminal code and we feel that we are doing exactly what the criminal code allows us to do," Pollock said.

When asked about her predictions for the upcoming hearing, Roiter asked rhetorically whether it is ever very wise to predict.

"It's a question of application and interpretation of the criminal code and of having a level playing field for everybody," she said.

Anne Lindner can be reached at