In an interesting twist, a prospective operator of an internet casino service is suing the State of Wisconsin stating they have the right to operate their business in that state. Their attorney, Jim Lisowski, dropped that bombshell in a presentation on internet gambling to the North American Gaming Regulators Assn.
Online International, Inc., a wholly-owned subsidiary of World Wide Web Casinos, Inc., filed a suit in U.S. District Court, Eastern Division against Gov. Tommy Thompson and Attorney General James Doyle for refusing to let an online gaming business open in suburban Oak Creek, Wisc.
The action arose from the State's threatened enforcement of
Wisconsin's gambling laws against Online, even though Online will not take wagers from players within the state or within the U.S. Online International has filed for Declaratory and Injunctive Relief under the Federal Declaratory Judgment Act. Online asserts that the State of Wisconsin, by enforcing their gambling laws against Online, would be superseding Federal authority as set forth by the Commerce Clause of the U.S. Constitution, the Wire Act, the Communications Decency Act, the Travel Act, the Crime Control Act and the First and Fourteenth Amendments to the U.S. Constitution. In addition, the company asserts that it is being deprived of revenues of $1,500,000 per week as a result of Wisconsin's threatened action.
Online International is asking the court to issue a permanent injunction barring Wisconsin from enforcing state gambling laws against Online International. Online is also asking the court to declare that the regulation of Internet gaming and the Wisconsin gambling laws are preempted by Federal law and to declare that the
application of Wisconsin gambling laws to Online's proposed internal gaming service is a violation of the First and Fourteenth amendments.
World Wide Web Casinos Inc. filed the lawsuit on in U.S. District Court here, contending that Doyle's office told the firm in March that setting up an Internet gambling business that would serve overseas gamblers was illegal under state law.
Lawyers for the Santa Ana, Calif., company claim in the lawsuit, however, that Wisconsin's gambling laws do not apply to its proposed Internet operation.
The lawsuit included a letter from the director of the state Justice Department's gaming enforcement bureau that said Internet gambling out of a Wisconsin location would be illegal even if the bettor were an overseas customer.
"Wisconsin law applies to both the person placing and the person receiving the bet," Gary H. Hamblin told World Wide Web Casinos in the March 25 letter.
World Wide Web Casinos is asking the federal court to declare that the regulation of Internet gaming and Wisconsin's gambling laws have been pre-empted by the U.S. Constitution's supremacy clause, which says all laws made pursuant to the Constitution are superior to any conflicting state law.
Should make for some interesting legal arguments which will be watched closely by those interested in this fledgling industry.