Letter to the Court - Feb 23

February 23, 2000

VIA HAND DELIVERY
The Honorable Thomas P. Griesa
Chief United States District Judge
Southern District of New York
500 Pearl Street
New York, New York 10007

Dear Chief Judge Griesa:

In response to this Court's inquiry yesterday afternoon concerning legal interpretations of the phrase "information assisting in the placing of bets or wagers" in Section 1084, enclosed please find the opinion of the Legislative Counsel of California dated June 21, 1999.

The Legislative Counsel opinion addresses the question whether a duly licensed multi-jurisdictional simulcasting and interactive wagering totalizator hub located in Oregon, operating in accordance with the interstate Horseracing Act of 1978 and Oregon law may lawfully receive telephoned wagering instructions from California residents of legal age who have previously established accounts in Oregon with that hub.

As explained in the opinion, this question turns on whether the wagering instructions constitute "information assisting in the placing of bets or wagers" or "bets or wagers" per se within the meaning of Section 1084. The Legislative Counsel opined that:

None of this paragraph, BOTTOM 1ST PAGE, came through...jurisdictional simulcasting and Interactive wagering totalizator hub located in Oregon that is duly licensed by the Oregon Racing Commission and is operating in accordance with both the federal Interstate Horseracing Act of 1978 and Oregon law may lawfully receive telephoned wagering instructions from California residents of legal age who have previously established accounts in Oregon with that hub.

Legislative Counsel of California, Opinion No 15x74 (June 21, 1999) at 1.

As noted in footnote 4 of our letter dated February 22, 2000, and at page 2 of the Legislative Counsel opinion, the Interstate Horseracing Act of 1978 does not address the legality of one state accepting a wager from a bettor who is not present in that state at the time the wager is placed. Nor does Section 1084 contain any exemption for wagering on horse races. Accordingly, the lawful operation of betting operations in New York, Oregon, and elsewhere, wherein an out-of-state account holder communicates wagering instructions by telephone or other electronic means to the account wagering facility located in the state where the bet is accepted, is premised upon the interpretation that such wagering instructions constitute "information assisting in the placing of bets or wagers" and not "bets or wagers" per se under Section 1084.

Jay Cohen's understanding of the operations of Capital OTB is thus directly probative of a key issue in this case, namely, whether he knowingly used a wire communication facility for the transmission in interstate or foreign commerce of bets or wagers. Any instruction to the jury that off-track betting in New York or elsewhere is governed in relevant part by a different federal statute would be erroneous as a matter of law.

Respectfully,

Benjamin Brafman

Cc: Joseph V. DeMarco, AUSA
Teresa A. Pesce, AUSA
Jay Cohen