Despite a letter from the Department of Justice to the Nevada Gaming Commission essentially telling the regulatory body that any initiative in that state introducing Internet gambling would be in violation of federal law, the commission is moving forward with public meetings on the possibility of intrastate interactive gaming.
The commission sent out a public notice to its licensees and interested parties informing them that three public meetings will be held--in September, October and November--to discuss the feasibility of interactive gaming within Nevada's borders.
They will be the first meetings of this nature held by the commission since a two-day session late in the summer of 2001.
In June 2001, the Nevada Legislature passed a bill making interactive gaming legal throughout the state. However, it was contingent upon approval from the federal government as well as the adoption of a system that could lock out restricted users and minors.
As part of that process, officials with the state attorney general's office began a dialogue with the U.S. Department of Justice. Nevada criminal justice leaders wanted to assure that its operators and
consumers would be cleared of federal laws if the interactive gaming initiative moved forward. More than a year after the line of communication was initiated, the DOJ has taken its stance.
Last week's letter, in part, said that any state plan would be in direct violation of the Federal Wire Act of 1961, virtually eliminating any chance of Nevada moving forward with its regulatory effort unless federal statutes are changed.
Las Vegas lawyer Tony Cabot, an expert on interactive gambling, was quoted by the Las Vegas Review Journal in an article published Tuesday as saying that the DOJ letter hinders the commission from moving forward, but still leaves the door open for intrastate gaming, if the demand is there from operators.
"Until a court rules differently or Congress changes federal law, the (Justice Department) letter will likely prevent Nevada regulators from writing rules allowing interactive gaming from outside the state," Cabot told the newspaper.
Cabot is one of many gaming law experts who maintain that the Department of Justice is off-base in its assessment (or lack thereof) of case law and the legal landscape by which it drew its determination that interactive gaming would be illegal if Nevada moved forward.
"It was a bald conclusion," Cabot said. "There's no good legal analysis to support the decision."
Cory Aronowitz a gaming law expert in Chicago agreed with Cabot but went a step further.
"The DOJ needs to read the published opinions of the federal courts," he said. "For the DOJ to say that the Wire Act applies, they have to ignore opinions that say otherwise. If the Wire Act does apply, then why aren't they prosecuting Internet casino sites? We haven't seen prosecutions of anything besides online sports betting. The DOJ can send a letter, but they're not following through with prosecutions."
But the commission, as far as its concerned, has the direction it needs to move forward, as the letter clearly states that intrastate gaming would be entirely under the jurisdiction of Nevada regulators and state law.
Gaming Commissioner Dennis Neilander told IGN last week that his board would begin to explore those options as soon as possible.
The public meetings will be held in conjunction with the commission's monthly meeting. The Sept. 26 and Nov. 21 meetings will take place in Las Vegas; the Oct. 24 meeting will convene in Carson City.
Some have speculated, however, as to how big the demand will be from Nevada operators to explore interactive gaming if their market will be limited to gamblers within state borders.
Cabot pointed out that the state isn't that big and that it has already been saturated with gambling.
Others have pointed out that most of Las Vegas' business is derived from out-of-towners, making intrastate gaming an unappealing proposition.
Until either the federal courts rule the Wire Act and other laws pertaining to gambling don't apply to casino style games or there is a change in the federal code, little movement is expected in Nevada.
Click here to view a copy of the Nevada Gaming Commission's form for the upcoming public input phase.