POWERFUL ARGUMENTS IN iMEGA RESPONSE

21 September 2007

The US government appears to have a real fight on its hands over UIGEA


When the largely unknown Interactive Media Entertainment & Gaming Association [iMEGA] burst onto the online gambling scene earlier this year, challenging the US government's Unlawful Internet Gambling Enforcement Act, there was some scepticism about its motivation and ability to stay the course. In recent months those sceptics will be reconsidering their opinions as the nascent organisation has shown an impressive legal capability that has US officials on the back foot.

In the latest exchange, the defending US government tried to have the iMEGA challenge dismissed as lacking in legal standing and challenging an "unripe" law. iMEGA came back with a cogent and powerful riposte which the government must answer by September 21(see previous InfoPowa reports).

iMEGA's website shows the extent and depth of that 50 page riposte, where the Department of Justice's motion for dismissal is dismantled with telling precedents and new and important points are added to the developing iMEGA argument...an evolving process as promised by the organisation's president, Edward Leyden who said earlier that the organisation's own case is being continually improved.

Among the additional points, iMEGA claims that its actions meet the legally accepted standard of review; that it does have standing based on prior legal precedent and that the UIGEA "directly causes injury-in-fact to plaintiff's members and the public." The brief stresses that it is important to "....recall the terms of the UIGEA, in particular its impact on the First Amendment, the commercial livelihood of iMEGA's members, and the UIGEA's criminal penalty provisions."

iMEGA goes on to cite respected legal precedent in cases dealing with the battle between government control and personal control regarding Internet access, pointing out that courts have repeatedly struck down over-reaching regulations on unconstitutional grounds, especially those related to fundamental freedoms in the US Constitution.

A more technical argument revolves around the failure of the US authorities to produce supporting regulations for the UGIEA within the 270 days stipulated by Congress. Somewhat disengenuously, the government tried to turn this failure of authority into an advantage in the iMEGA case, claiming that the UGIEA was "unripe law" and could not therefore be challenged.

Describing this tactic as "intriguing" the iMEGA brief comments: "Under the Federal Administrative Procedures Act, "agency action includes the whole or a party of an agency rule, order, license, sanction, relief, or the equivalent or denial thereof, or failure to act.
"Simply put, the government missed the deadline to define legal and illegal transactions," the brief continues, referring to UGIEA which seeks to disrupt private financial transactions with online gambling companies. The brief goes on to enumerate other reasons why the case should be considered ripe at this time.

The World Trade Organisation bind in which the US has found itself over online gambling disputes with Antigua is prominent in the current iMEGA brief, with iMEGA making the logical point that the US, in dropping its World Trade Organisation appeal, has made a de facto acknowledgment that such gambling was and is legal from the time when the treaty round – referred to as the Uruguay Round - went into effect over a decade ago.

Irrespective of the ongoing attempts by the US Trade Representative to withdraw its online gambling obligations from the WTO treaty terms, the fact that it dropped its appeal raises legal questions that can be brought up by individual parties in a US-federal action, even if those same parties would have no grounds for action in the WTO matter itself, iMEGA argues.

Thus far it would appear that iMEGA is more than holding its own, and the next legal exchanges will be watched with close interest as this important issue develops.

Online Casino News courtesy of InfoPowa