March 4, 2000

To: CLS Participants (Web only; e-mail alert)

From: Nicholas Johnson

Re: CLS/Reading Assignments for March 8, 2000

Gambling on the Internet

"General Semantics! You know, I'll bet the next thing Nick makes us study is gambling."

"You think he'd do that?"
"I'll bet he does."
"How much you want to bet?"
"I don't gamble."
"Not even on the Internet?"
"Especially on the Internet."

Note: The following material, as always, will be the subject of a brief quiz.

It is neither required, nor recommended, that you visit an actual online gambling site in order to prepare for this class. Indeed, if you know you have a gambling addiction problem it is strongly recommended you not do so. There is, however, a Problem Gambling Resources page available from the Internet Gaming Commission you might wish to visit.

1. Start with Anthony Cabot, "Gambling on the Internet: The Conflict Between Technology, Policy and Law." This was a paper presented at CommerceNet '96, Oct. 15-17, 1996, San Francisco. (About 21 pages total as the six sections printed out for me.)

Not being a gambler myself, before I read this piece for the first time I assumed I knew what "gambling" was. Section one takes five-plus pages to define it and provide Internet illustrations. Why do we care about gambling -- as a matter of law, public policy or theology? That's section two. Section three explores why Internet gambling is especially troublesome from the standpoint of policy. Section five is seven pages of "practical problems with enforcement," followed by a concluding section of policy alternatives.

All in all, this article is not only a useful overview of the subject, but a useful source of discussion questions as well.

As you'll see from this piece, and the others assigned, we will be dealing with a number of categories of issues this evening: the nature of gambling, its history and attraction, the policy arguments for and against its various forms in various places, gambling as criminal activity, the problems of enforcement, gambling and state-federal relations, issues of jurisdiction -- and then we start all over again with the Internet and gambling.

What is the impact of the technology, sociology and global reach of the Internet upon all of these issues: What additional social/policy problems are created when gambling goes Internet? Is it possible to have state or national regulation, or do we have to evolve some global regulatory scheme? At what point does a Web site meet the International Shoe due process standard of "fair play and substantial justice" in providing jurisdiction for a court far from the server, or operator, of an online gambling business? What is the significance of imposing criminal or civil responsibility on (a) the operator, (b) the credit card company (or other processor of cash equivalent), or (c) the "player"?
Moreover, it also offers us an opportunity at a kind of take home quiz question. One of the best ways to improve your own writing is to edit the writing of others. Especially in the age of spell checkers one tends to be less meticulous about old fashioned proof reading. But all that spell checkers check is whether the words are spelled right, not whether they are the right words. (E.g., ". . . words are soiled right, not weather their the write wards.") Cabot was not as thorough with his proof reading as he might have been. As you are reading his piece anyway keep an eye out for errors. Make a note of two; write them on a piece of paper; bring it with you to class; copy from it as your answer to the first quiz question. (This is for all participants, not just those writing papers, or just those not writing papers.) Just a little bit of added education for you at no extra charge.

2. Read 18 U.S.C. Sec. 1084 and then sections 1081, 1082 and 1083 as well. (Each is less than one page.)

3. Florida Attorney General, Advisory Legal Opinion: Internet/wire Communications Gambling; Cruise Ships (1995) (5 pages).

4. Humphrey v. Granite Gate Resorts (Minn. D.Ct. 1996) (10 pages).

5. Thompson v. Handa-Lopez, Inc. (W.D. Texas 1998) (5 pages).

6. MSNBC's report, "Guilty Verdict in Net Betting Trial," Feb. 28, 2000, is the latest word in online gambling liability. It is, in fact, the item George was trying to bring to our attention. (I gave you the wrong cite in the last e-mail -- although I was accurate in saying I had wanted to bring it to your attention anyway.) (It's 3-plus pages.)

7. Courtney Macavinta, "Net Gambling Lawsuit Back in Court," CNET News, March 5, 1999 (1 page).


Although not the subject of quiz questions, the following are also related, interesting, of use, and recommended:

a. American Bar Association, Internet Jurisdiction, Public Law/Gaming

b. Lance Rose, "Online Gambling: Killer App or Sucker Bet?", Boardwatch Magazine, Jan. 1996 (3 pages).

c. There is an Internet Gaming Commission. If you want to see an example of its work, here is its report on Vegas USA. If you want to see an example of the online gaming site it's reporting about here is Vegas USA (in English; it comes in 12 languages).

d. A site I came upon that links to a number of resources for online gamblers is Mad Gambler ("A gathering spot for those who love to gamble online"). Although I view it as the problem rather than the solution, I thought it should be listed.

e. If you're practicing in this area of the law you might want to check out Casino Law. It has links to laws and decisions in various jurisdictions. Under "professionals" it has a reference to only four firms, so it may be they are the ones maintaining it. It says its copyright by the Webmaster (who appears not to be a lawyer). Its "Casino Newz" is an archive of an e-mail-distributed news service that appears to have been monthly so far in the year 2000.

f. Finally (you'll be relieved to know -- this collection of resources could go on forever; indeed, you may think it already has), "Cyber Gambling" was the subject of a law school course at the University of North Carolina a couple of years ago. (The professor is Laura N. "Lolly" Gasaway, Director of the Law Library and Professor of Law.) The seminar Web site contains links to "What is Cyber Gambling?", "State of the Law," "Reform Proposals," and "Policy Issues." The site throws large dice at you of frightening size and speed and offers an answer to the burning question, "Would Thomas Jefferson approve Internet gambling?"