Gov. Chris Christie Being Vetted as Potential Vice-Presidential Pick for Trump Poses Grave Dangers to State-Authorized Medical & Regulated Marijuana.

Voters in four states and Washington, D.C. have approved measures legalizing marijuana for individuals over 21, and four states — Alaska, Colorado, Oregon, and Washington — approved taking marijuana production and sales off the criminal market and regulating and taxing them. Additionally, 25 States have now legalized marijuana for medical use within those States.

New Jersey Gov. Chris Christie is now being vetted as a possible vice presidential pick for presumptive Republican nominee Donald Trump, according to two ranking Republican officials as reported earlier today by Yahoo News and The Guardian.   Additionally, many in the Beltway contend that Gov. Christie would be on the short list for appointment of US Attorney General in a potential Trump Presidential Administration.

During the Republican Presidential Debates, Gov. Chris Christie unequivocally and unambiguously stated that he would use the Federal governments authority via the USDOJ or otherwise to shut down all licensed and/or regulated use of marijuana in any State regardless of lawful medicinal or other legal use within such a State — i.e., Christie vowed not to follow the current DOJ policy concerning marijuana as most recently has been set forth in its 2013 Memo.

 
Protecting the Principle of Federalism in Marijuana Policies: Rep. Dana Rohrabacher (R-CA) reintroduced H.R. 1940, the Respect State Marijuana Laws Act with strong bipartisan support. This legislation would modify the federal Controlled Substances Act to protect anyone acting in compliance with state marijuana laws from federal prosecution and resolve the conflict between state and federal marijuana laws, ensuring states can determine their own policies. Others have introduced similar legislation.

It remains imperative that all US States who have already authorized and/or decriminalized marijuana be vigilant in monitoring Federal officials and those who aspire to be.  Similarly, States such as California which are now contemplating legal marijuana on the ballot this year, should be fully aware of Federal policy and particularly those who will be in a position to apply it.

 
Accordingly, should Trump select Christie as his VP (potentially becoming only a heartbeat away from the Presidency), or alternatively, appoint him as his AG in any Trump administration should Trump become POTUS, the result for State regulated, authorized, and legal marijuana could be disastrous specifically to State-authorized marijauna and generally to concepts of federalism as to other fundamental State’s rights.
En garde.

By Mistake or By Design: Why Does DraftKings Technology Not Block Proxies To Keep DFS Users From Restricted US States?

Saturday, November 14th 2015Ian J. Imrich, Esq.

Experts in geolocation — the technique of determining a computer’s location — say that blocking proxies is one of the first, and most straightforward, steps that websites take to keep users from restricted areas off the sites.

DraftKings clearly states the importance of complying with the laws of certain US jurisdictions. But as reported by the New York Times (whose investigative journalists probed the matter), some question the sincerity of the site operator’s terms of use.

By stating in the “terms of service” that users in some regions are not allowed, while at the same time doing little to enforce the rule, online gambling companies around the world often try to have it both ways, said Feda Mecan, a senior official at Playing Legal, a site based in Germany that is devoted to legal gambling in the United States. “I think they are playing that card, to be honest,” Mr. Mecan said.

Then, according to a poker web forum the NYT has reported, a DraftKings employee appeared to provide public advice on how to circumvent geographic restrictions in the United States.

“It seems absurd that a daily fantasy sports operator with financial means would not implement the best possible technology,” Professor Marc Edelman of Baruch College said.

Whether by mistake or perhaps by design, the failure to timely, properly, and regularly employ readily available Geo-Blocking technology to comply with jurisdictional rules in certain States throughout the nation could prove disastrous in the ongoing investigations and pending legal proceedings against of one of the top two daily fantasy sports companies currently operating within the US.

Is The NFL Now Distancing Itself from Daily Fantasy Sports; and if so, Why Now…?

Friday, November 13th, 2015 – Ian J. Imrich, Esq. 

The fantasy sports gaming business in the US is almost entirely unregulated. That’s just the way the NFL has always wanted it — until now.

After NFL’s lobbying extensively in late 2006 to get a “carve-out” from the hastily passed Unlawful Internet Gaming Enforcement Act (UIGEA) — a carve out that the US Department of Justice never supported (and if reports coming out are true) —  the NFL is now quickly attempting to distance itself from the Daily Fantasy Sports (DFS) industry.  See, e.g., NFL is reviewing the entire fantasy sports situation, reports the New York Post.

Why now? Well, here are just a few possible reasons that might help to explain the NFL’s Fall of 2015 back-tracking:

-Legal challenges to the nationwide sports betting ban in Federal Courts are pending and the NFL remains vehemently opposed to any sort of legalized sports wagering (while the NBA by contrast favors regulated sports betting);

-Two major NFL owners could be forced to sell their huge equity stakes within the DFS industry;

-NFL policy strictly prohibits NFL employees or team owners from participating in or facilitating any form of gambling  — yet the same prohibitions do not apply to unregulated DFS skill gaming;

Meanwhile, what have Bob Kraft, Jerry Jones, and one major DFS site operator said about these reports?  So far, The Cowboys, Patriots and DraftKings have declined comment.  Will await to see how long their silence is deafening…

Why is UK-Based Daily Fantasy Sports Site FanDuel Only Now Applying For A License in the UK …?

Los Angeles, CA — November 6, 2015

Endemic gaming blogs are now reporting and FanDuel itself has confirmed that it is now applying for a gambling license in the UK vis-a-vis fantasy sports gaming.  See, e.g., http://www.legalsportsreport.com/5900/fanduel-uk-gambling-license/?utm_content=buffer93674&utm_medium=social&utm_source=twitter.com&utm_campaign=buffer

Why Now?  (Especially given the fact that FanDuel is — and has been for some time — a UK-based gaming company that has not ever previously offered its DFS services to customers / markets beyond the US and Canada) Because the US market has become increasingly cloudy on the legal and regulatory front – as simple as that.

While the US market for DFS has not and will not likely be entirely shut down, it is now abundantly clear that it’s going to be a potpourri of State-by-State regulations and with uncertainty as to ring-fenced intra-state gaming activity versus inter-state customer pooling and resulting liquidity via State to State compact, and all with the possibility of Federal Intervention lurking ominously in the background — currently during an election year in the US.
Of course, FanDuel could have made this move years ago.  The same could be said for its chief competitor Draft Kings.  But, as is the case in many an eCommerce industry (or brick and mortar for that matter), the threat of regulatory activity and possibility of legal enforcement often hastens the moves of companies who have yet to diversify, divest, and divulge.
Strategic business maneuvering is more art than science.   Here the creativity, while somewhat tardy, is still artistic.
–IJI

How Will Divergent Approaches To Sports-Related Gaming Issues Impact Macro eCommerce and Regulatory Approaches…?

October 29th, 2015 – Ian J. Imrich, Esq. 

The fantasy sports business in the US is largely unregulated. A handful of states have made it illegal to play fantasy sports for money and a few have laws making it expressly legal. None have in place a framework for regulating operators. Concurrently, traditional sports-betting (except for in a handful of States –notably Nevada) is illegal throughout the US.

On the one hand, the NBA has taken a progressive approach to regulatory measures for sports-related gaming activity in the US; meanwhile, the NFL maintains its vigorous opposition to legalization of traditional sports-betting, but seems to have painted itself into a corner regarding its contradictory and hypocritical “skill” arguments with respect to traditional sports-betting as compared and contrasted to fantasy sports betting of the daily, weekly, and other less than seasonal gaming.   See, e.g., http://espn.go.com/chalk/story/_/id/13268458/documents-show-justice-department-nfl-argued-skill-sports-betting

FanDuel has now embraced State-by-State regulation in the US in order to protect DFS consumers while DraftKings appears ready to dig in (perhaps emboldened by 2 powerful NFL owner-investors?) and by all appearances will resist any efforts by States to regulate DFS — relying instead on trade association self-regulation. See, http://www.wsj.com/articles/fanduel-ceo-calls-for-government-regulation-1446127412?cb=logged0.2795360852977816

Speaking of powerful sports-related owner-investors, recently, yet another NBA owner has joined two other NBA power-brokers on another sports-related venture: to wit, Ted Leonsis, who now owns the Wizards, the Capitals and Verizon Center, on last Tuesday announced that his Revolution Growth partnership is joining fellow NBA team owners Jordan, of the Charlotte ­Hornets, and Mark Cuban, of the Dallas Mavericks, in an investment in the Swiss technology firm ­Sportradar.

Sportradar collects data from more than 325,000 live sporting events across the planet, ranging from darts to tennis and from soccer to snooker.  Sportradar digests that data, then sells it to big media companies such as Google and Fox Sports, to fantasy sports leagues, and to gaming and gambling businesses. See, http://www.washingtonpost.com/business/capitalbusiness/ted-leonsis-team-with-michael-jordan-mark-cuban-in-sports-tech-investment/2015/10/27/84ef7f06-7cd9-11e5-b575-d8dcfedb4ea1_story.html

In any event, with a convergence of sports-betting related investments and other strategic business alliances being forged whilst the consumers, media, and the government simultaneously review the DFS industries, it begs the question —  how will these dramatically divergent approaches to DFS (and to sports-betting in general) between two major sports leagues play out as the ongoing State and Federal investigations of Daily Fantasy Sports (DFS) ominously loom in the background…?

I guess all of us are about to find out…

Stay tuned!

–IJI

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The Fed & US Treasury to Publish Information Collection Activities; Proposals, Submissions, and Approvals re Prohibition of Funding of Unlawuful Internet Gambling [UIGEA]

http://www.jdsupra.com/legalnews/the-fed-us-treasury-to-publish-informa-76770/

The Federal Reserve and Treasury Department announced on Monday, June 8, 2015 the renewal of a recordkeeping requirement intended to show that payment systems are implementing policies to “identify and block or otherwise prevent or prohibit transactions in connection with unlawful Internet gambling.”

BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM DEPARTMENT OF THE TREASURY

“Agency Information Collection Activities; Renewal of a Currently Approved Collection; Comment Request; Prohibition on Funding of Unlawful Internet Gambling”

AGENCIES:

Board of Governors of the Federal Reserve System (“Board”) and Departmental

Offices, Department of the Treasury (“Treasury”) (collectively, the “Agencies”).

ACTION:

Joint notice and request for comment.

SUMMARY:

The Agencies are soliciting comments concerning the currently approved recordkeeping requirements associated with a joint rule , which is being renewed without change, implementing the Unlawful Internet Gambling Enforcement Act of 2006 (the “Act”).

This notice is published jointly by the Agencies as part of their continuing effort to reduce paperwork and respondent burden. The public and other Federal agencies

are invited to take this opportunity to comment on this information collection, as required by the Paperwork Reduction Act of 1995, Pub. L. 104 – 13 (44 U.S.C. 3506(c)(2)(A)).

This document is unpublished, but on 06/09/2015 it is scheduled to be published and available on the Federal Register web page. Until then, you can download the pre-publication attached PDF version.