This is a follow up to our recent blog post regarding the DOJ Opinion on its interpretation of the Wire Act. In a memo dated January 15, 2019, the Deputy Attorney General declared:
Department of Justice attorneys should adhere to the Office of Legal Counsel’s (OLC) interpretation, which represents the Department’s position on the meaning of the Wire Act. See 28 C.F.R. § 0.25.
Continue Reading DOJ Wire Act Update – 90 Day Window for Compliance
The Department of Justice (DOJ) has issued an opinion (DOJ Opinion) that reverses its 2011 Memo, in which it opined that the prohibitions of the Wire Act are limited to sports betting. In the DOJ Opinion, the DOJ has concluded that the 2011 opinion was wrong! It now opines that only one of four parts of the Wire Act apply to sports betting, while the other three apply to any online betting. It also concludes that the 2006 enactment of the Unlawful Internet Gambling Enforcement Act (UIGEA) did not alter the scope of the Wire Act.
Continue Reading DOJ Does High “Wire Act” – Flip Flops on Legality of Online Gambling
Blockchain is a revolutionary technology that has great potential to solve many of the fundamental challenges facing the music industry today. Blockchain technology including distributed, decentralized ledgers, smart contracts, and the ability to tokenize digital assets, is uniquely suited to address issues such as rights management, licensing, copyright ownership, royalty tracking and reporting and the primary and secondary ticketing markets for live events. Various aspects of the technology are currently being used to address some of these problems. Despite these current uses, blockchain adoption likely will be incremental and more evolutionary than revolutionary, at first. Longer term, blockchain technology could provide a more comprehensive solution for the industry.
Continue Reading How Blockchain Technology Can Improve the Music Industry
How the Evolution of Games Has Led to a Rise in Gambling Concerns
Recently, there has been a frenzy of legal activity with U.S. gambling laws and the number of gambling-related legal issues with video games. U.S. gambling laws have changed more in the past few years than they have in a long time. Significant state law changes have occurred concerning online gambling, sports betting, fantasy sports, and skilled-based games, to name a few. Some significant recent changes under federal gambling law have also occurred. The evolution of certain aspects of games by the game industry—particularly those involving loot boxes, casino-style games, and chance-based mechanics with virtual items—has raised the perception of certain gambling-related issues. Despite being prohibited by game publishers, players’ engagement in unauthorized activities (e.g., selling virtual items on secondary markets and “skin gambling”) have exacerbated these issues. The financial success of these monetization techniques has led to greater legal scrutiny. The rise of eSports has also implicated sport betting issues.
Continue Reading All Bets are On! Gambling and Video Games
The United States Securities and Exchange Commission (“SEC”) has indicated that nearly all initial coin offering (“ICO”) filings they have seen are securities offerings. Based on this expansive view, it may be more likely to find a Unicorn than an ICO that is not a securities offering. Ironically, a recent lawsuit was filed against Unikrn, a block-chain based betting platform, primarily focused on esports betting.
Continue Reading Is there a Unicorn Among ICO Issuers?
Apple’s App Store Review Guidelines have been updated to address various aspects of crypto currency. Some of the relevant provisions include the following.
One of the provisions relates to prevents an app from including ads that run background processes such as crypto mining. This is a tactic that has arisen, unbeknownst to many users. The relevant provision recites:
2.4.2 Design your app to use power efficiently. Apps should not rapidly drain battery, generate excessive heat, or put unnecessary strain on device resources. Apps, including any third party advertisements displayed within them, may not run unrelated background processes, such as cryptocurrency mining.
Continue Reading Apple Updates Crypto Currency Aspects of App Store Review Guidelines
The SEC has formally announced that Ether is not a security. The U.S. Securities and Exchange Commission Director of Corporate Finance William Hinman said that the commission would not be
Continue Reading SEC Declares Ether Is Not a Security
As we have previously reported, the number of blockchain patents being filed and granted is continuing to increase. According to a Thomson Reuters report, 225 out of the 406 blockchain patents (55.4%) filed in 2017 came from China, followed by 91 (22.4%) from the U.S. and 13 (3.2%) from Australia. The following is a brief summary of a few such patents that have been recently filed or granted in the U.S.
Continue Reading Recent Blockchain Patents of Note
Churchill Downs has filed a Petition For Rehearing En Banc, seeking to overturn the Ninth Circuit decision in the Big Fish case. As we previously reported, The Ninth Circuit Court of Appeals reversed a district court’s dismissal of a purported class action and held that a social casino game constituted illegal gambling under Washington law. According to the Court, all online or virtual gambling is illegal in Washington state. The panel held that the virtual chips extended the privilege of playing the game and fell within Wash. Rev. Code § 9.46.0285’s definition of a “thing of value.”
Continue Reading Churchill Downs Seeks En Banc Review of Big Fish Decision
We previously reported, that the Belgian Gaming Commission has recommended criminal prosecution against certain game companies due to the allegedly illegal use of loot boxes. This report follows previous reports on findings by the Netherlands.
The Belgian Gaming Commission includes recommendations that extend to certain companies doing business with game companies, including Licensors (e.g., FIFA) and platform providers.
In its Loot Box Report, the Belgian Gaming Commission stated: “A wager (bet) of any type is sufficient to qualify as betting for these games. Use of money is not necessary. Just because virtual currency is used in a game does not mean that there is no wager. It must be possible to attribute a value to this wager, however. Value can be defined as the degree of usability. Specifically, items that the player finds useful or nice and for which he pays money.”
Continue Reading Belgium Gaming Commission Loot Box Report – Extends Beyond Game Companies to Licensors and Game Platforms