Second Circuit Reverses Judge Weinstein’s Decision in DiCristina, Authorizing Poker …

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By David J. Apfel

In a case that poker businesses all over the world have been watching, the Second Circuit Court of Appeals on Aug. 16, 2013 reversed Judge Jack Weinstein’s decision in United States v. DiCristina, and held that poker could be prosecuted under the Illegal Gambling Business Act (“IGBA”), 18 U.S.C. § 1955.

Judge Weinstein had entered a post-verdict judgment of acquittal of defendant DiCristina on the ground that poker was a game predominated by skill that could not be prosecuted as a matter of law under IGBA.  The Second Circuit held that the plain language of IGBA covered DiCristina’s poker business.  It, therefore, reinstated DiCristina’s conviction, and remanded his case to the district court for sentencing.

Ruling Retain Feds’ Preferred Prosecution Tool

If Judge Weinstein had been affirmed, federal prosecutors would have been deprived of their favorite statute for prosecuting poker businesses, and a number of high-profile federal prosecutions, including the remaining Black Friday prosecutions, would have been put at risk.  With the reversal of Judge Weinstein’s decision, prosecutors in the Department of Justice undoubtedly breathed a collective sigh of relief.

Of course, it is still possible that DiCristina will appeal the Second Circuit’s decision to the U.S. Supreme Court.  He has until Nov. 4 to petition the Supreme Court for certiorari.  But even if he petitions for cert., the chance that the Supreme Court would take the case is low, and the chance that the high Court would reverse the Second Circuit and reinstate Judge Weinstein’s decision would seem to be even smaller.

The simplicity of the Second Circuit’s decision belies its importance.  Judge Weinstein had written a 120-page exegesis in which he carefully explained how and why poker is a game predominated by skill, and is, therefore, markedly different from the nine forms of “gambling” listed in subsection 1955(b)(2) of IGBA and covered by the statute.  As noted by the Second Circuit, Judge Weinstein’s analysis “turned on the question of whether skill predominates” in poker, and, for that matter, whether skill predominates in any game that might be prosecuted under IGBA.

Second Circuit Rejects Suggestion of Skill

The Second Circuit observed that Judge Weinstein himself had acknowledged that in future IGBA prosecutions following the Weinstein approach would “require ‘an ad hoc analysis of how similar or dissimilar the game was to those listed in IGBA’s list of examples,’ creating an ‘extraordinary complex and unpredictable approach to the statute.’”  In rejecting Judge Weinstein’s analysis, the Second Circuit rejected the future complexity that it would have wrought.  Instead, the Second Circuit opted for simplicity.

Under the Second Circuit’s analysis, IGBA does not define “gambling,” and it does not make any form of gambling  or any particular game illegal.  Rather, the statute applies to any “illegal gambling business,” which is very specifically defined under IGBA as a gambling business which:

  • is illegal under the law of a State or political subdivision in which it is conducted
  • involves five or more persons
  • and (iii) operates for more than 30 days or has gross revenue of $2,000 or more in any single day.

State law is key to whether a particular game is illegal.  If a gambling business involving a particular game, whether poker or anything else, is illegal under State law, then it may be prosecuted under IGBA if the second and third IGBA elements are also met.

DiCristina and numerous amici had argued that IGBA requires a fourth element, namely, that the “illegal gambling business” involve a game of chance like those listed in the statute’s list of  “gambling” activities.  Judge Weinstein had effectively agreed with defendant and the defense amici, holding that since poker was predominated by skill it could not be prosecuted under IGBA.  The Second Circuit ruled that IGBA unambiguously includes three and only three elements.  And it expressly held that whether poker, or any other game, is predominated by chance or skill is entirely irrelevant to whether or not it may be prosecuted under IGBA.

Ruling Says IGBA’s Language is Clear

According to the Second Circuit, if Congress had wanted to limit IGBA to games of chance it could have said so in the statute, but it did not.  Instead, the statute says plainly and simply that any gambling business that violates State law may potentially be prosecuted, regardless of whether the gambling involves games of pure skill or pure chance or a mixture of skill and chance. Again, it is state law that controls.  If poker, or any other game, is legal under the law of the state where it is played, it cannot be prosecuted under IGBA.  But where a game is illegal under state law, IGBA may be used to prosecute the offense federally.  According to the Second Circuit, it is the plain language of IGBA that unambiguously makes this clear.

If there are legal flaws in the Second Circuit’s analysis, they are not obvious.  Indeed, it is no mere accident that every other court, with the exception of Judge Weinstein, that has interpreted IGBA has come out the same way as the Second Circuit.  In light of the general consensus interpretation the courts have given IGBA, it is hard to see the Supreme Court granting cert. to review the Second Circuit’s opinion.

And, in the unlikely event the Court takes the case, it is even harder to see it reversing the Second Circuit and reinstating Judge Weinstein’s decision.  When it comes to poker and other games that violate state law, it appears as if IGBA will remain an arrow in DOJ’s quiver for years to come.

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