iMEGA's Loss May be a Win

The Interactive Media Entertainment & Gaming Association (iMEGA) has been granted the right to pursue its challenge of the Unlawful Internet Gambling Enforcement Act, but overall, the organization's case against the U.S. government was dismissed.

iMEGA in June filed for a preliminary injunction against the DOJ, the Federal Trade Commission (FTC) and the Federal Reserve Board of Governors (iMEGA v. Gonzales, et al.) to prevent the enforcement of the UIGEA, claiming it infringed on Americans' First Amendment rights. The defendants filed a cross motion in August to have the complaint dismissed, arguing that iMEGA's case lacked substance and that they had no legal standing to challenge the law.

At long last, Judge Mary L. Cooper, of the U.S. District Court for the District of New Jersey, on Tuesday handed down a decision, granting iMEGA standing, but dismissing iMEGA's complaint based on merits.

I-gaming lawyer Pat O'Brien said that the decision means iMEGA has a right to go to court and challenge the law, but that they don't have any case.

iMEGA chairman Joe Brennan Jr. said that they may have lost, but it feels like a victory because Cooper granting them standing cleared the path for appeal. He said in that respect, they've come out farther ahead of the government. iMEGA was founded with the purpose of defending what Brennan calls "digital civil rights." And the UIGEA was the most serious challenge to the notion of the right to privacy in that it criminalizes an activity that offline is legal, he said.

"What we are asserting is that American's have a First Amendment right to privacy," Brennan said. "We don't say that; the Supreme Court has said that and has affirmed that over and over and over again, whether you're looking at Roe v. Wade or Lawrence v. Texas from just a couple of years ago."

And while Cooper dismissed the case on the merits of the First Amendment claim, she went to great lengths in her decision to establish iMEGA's standing and its standing as an association.

"If a judge was just going to dismiss something on the merits why would she spend any time at all establishing an association's standing?" Brennan said. "This judge knows that this is going to be appealed, and in a way she has kind-of created the breadcrumb trail for us to appeal through her decision."

Brennan said iMEGA will appeal the decision in the Third Circuit.

"What we are primarily looking for from the court is that assertion regarding Americans' fundamental right to privacy," he said. If we have a fundamental right to privacy we should enjoy that right even when we're online. Secondly, we want this law overturned because of the chilling effect it has on our right to privacy and the government's interference with it. And the law is a defective, unworkable law. It is inconsistent with offline law. If gambling is legal in 48 of the 50 states how can it be expressly illegal just because it's online?"

Cooper did not dismiss the case with prejudice, which means iMEGA lost this case, but they were not told that it would never be heard in a federal court. So, they have at least retained the power to fight.

Click here to view the decision.