Eastern District Of New York Rules Poker Is Not Gambling Under IGBA

In a decision that could have a significant impact on gaming companies, Judge Jack B. Weinstein of the U.S. District Court for the Eastern District of New York ruled on Tuesday that poker does not constitute gambling under the Illegal Gambling Business Act ("IGBA"), a federal statute that makes the operation of any "illegal gambling business" a criminal offense. See U.S. v. Dicristina, No. 1:11-cr-00414-JBW (E.D.N.Y. Aug 21, 2012). While poker operations remain illegal under the laws of the vast majority of U.S. states, including New York, the decision may lend support to the argument that online poker operations should be considered outside the scope of certain other federal laws regulating online gaming.

Background

Defendant Lawrence Dicristina was charged in December 2011 with operating an illegal gambling business in violation of the IGBA. His business consisted of two poker tables in the back room of a bicycle warehouse, where poker games were held twice a week. Dicristina collected a five-percent "rake" of the amount bet by his customers on each hand, and employed several dealers and waitresses. Following a jury trial, Dicristina was found guilty on all three counts in his indictment, and immediately renewed a motion for a judgment of acquittal.

In his motion for a judgment of acquittal, Dicristina argued that poker was not "gambling" under the IGBA, which defines "gambling" as "includ[ing] but . . . not limited to pool-selling, bookmaking, maintaining slot machines, roulette wheels or dice tables, and conducting lotteries, policy, bolita or numbers games, or selling chances therein." Id. at 101 (citing 18 U.S.C. § 1955(b)(2)). Specifically, Dicristina argued that gambling under the IGBA was limited to those games explicitly listed in § 1955(b)(2) or substantially similar to such games, and attempted to differentiate poker as "a game of skill rather than chance and thus outside the purview of the statute." Id. at 9. The government countered primarily by arguing that any form of gambling illegal under state law could be prosecuted under the IGBA.

Decision

After a lengthy discussion of state and federal gambling laws, and a summary of scientific studies conducted on the relative degree of skill and chance inherent to poker, Judge Weinstein concluded that the poker is not gambling under the IGBA. Judge Weinstein's conclusion was premised on his finding that because neither the text of the IGBA nor its legislative history clearly...