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United States v. DiCristina: The Interaction of Federal and State Law

JURIST Guest Columnist Renè DuBois, New York Law School Class of 2013, analyzes the United States v. DiCristina opinion and points out its flaws and limitations...

If anyone has ever watched the movie Rounders, they will vividly remember Matt Damon playing the Dean's poker hand without once looking at his cards:
You were lookin' for that third three, but you forgot that Professor Green folded it on Fourth Street and now you're representing that you have it. The D.A. made his two pair, but he knows they're no good. Judge Kaplan was trying to squeeze out a diamond flush but he came up short and Mr. Eisen is futilely hoping that his queens are going to stand up. So like I said, the Dean's bet is $20.
Although probably leaving a lasting impression on non-poker players, Matt Damon did not have any magical, see-through-the-cards vision; ostensibly he just used his poker skills. That's right — poker is a game of skills.

At least that is what Judge Jack Weinstein concluded in United States v. DiCristina, expressly rejecting the notion that an organized game of poker is considered illegal gambling under federal law. The central issue in the case was a narrow one: whether an organized poker game violates the Illegal Gambling Business Act (IGBA) — a federal statute that prohibits certain gambling operations for profit. Specifically, under subsection (b)(1) of the IGBA, an "illegal gambling business" is a gambling business that violates state law (there are two additional elements discussed below). Notably, it also provides a non-exhaustive list of "gambling" activities, many of which are traditional casino and sports betting activities such as roulette, bookmaking and slot machines under a separate definition found in subsection (b)(2). Poker, of course, is not one of the activities listed.

However, many states — including New York — have either expressly included poker in their definition of gambling or have concluded that poker is a game predominated by chance and, accordingly, an illegal gambling activity. In the same manner, state courts have had various opportunities to decide whether poker is considered gambling under different state gambling laws. Federal courts, in contrast, have had less opportunity to do so. In DiCristina, however, Weinstein was presented with this opportunity and took the challenge head-on. Notwithstanding the breadth of Weinstein's opinion in DiCristina, there remain a few legal and policy questions unanswered.

As an initial matter, much of the recent commentary on DiCristina has rightly focused on the glaring conclusion that poker is a game predominated by skill. However, it is important to note that the court had to jump over a few preliminary hurdles before getting to the heart of the case. The court first had to find that the IGBA contained a prerequisite of meeting its own definition of "gambling" — regardless of whether state law definitively answered that inquiry. Further, it had to conclude that "gambling" under the IGBA only included games predominated by chance. Whether this newly defined prerequisite is legally sound raises some doubts.

Tellingly, the court in DiCristina began its analysis of the statutory text and legislative history of the IGBA by citing United States v. Turley for the proposition that "[u]nless Congress manifests an 'intent to incorporate diverse state laws into a federal statute, the meaning of [a] federal statute should not be dependent on state law." The court then reasoned that, although subsection (b)(1) unambiguously incorporates state law, subsection (b)(2), which defines "gambling," does not. Instead, the court highlighted that, just like the definition of "State" under the statute, the definition of "gambling" under subsection (b)(2) is a separate and distinct provision from elements under (b)(1). On highlighting this distinction, the court suggests that, under the IGBA and as a matter of sound interpretation, both definitions of "gambling" under subsection (b)(1) and (b)(2) must be met in order to trigger liability under the IGBA. The fundamental flaw in this reasoning is two-fold.

First, the IGBA — in its entirety — was undoubtedly meant to rely exclusively on state law in determining whether a particular gambling activity, like poker, was illegal. The court itself recognized that the overriding purpose of the IGBA was to address the rampant increase in organized crime during the 1970's, which involved various gambling activities across the US that were unreachable without the resources of the federal government. But the IGBA was not meant to supplant states from prosecuting the same crimes under state law. The court even noted that "[t]he IGBA was not designed to 'define discrete acts of gambling as independent federal offenses.'" Indeed, the US Congress chose to specifically rely on state law to provide the basis for jurisdiction by requiring that the alleged illegal gambling activity be prohibited under state law. Presumably, if Congress wanted to preempt state law as to what constituted gambling or create a distinct federal crime prohibiting particular gambling activities, it could have done so. Yet the court posits that if the IGBA was designed to "federalize all state gambling offenses it need not have included any definition of gambling." That logic, however, fails to consider that by including a list of non-exhaustive gambling activities, Congress has done nothing more than provide an example of which illegal gambling business activities concerned it. In so doing, Congress was focused on targeting particular "business operations" not individual gambling activities. Thus, including a definition of gambling does not provide any independent [PDF] significance because the IGBA entirely relies on state law.

Certainly, it would be difficult to argue that Congress had a substantial federal interest in prosecuting certain gambling activities over others — if the basis for enacting the IGBA was to focus on criminals that engaged in big scale gambling operations that posed harm to US citizens. To construe the IGBA, as the DiCristina court urges, would not further Congress' purpose in dealing with illegal gambling businesses of major proportions. Rather, it would preclude a class of gambling business activities that violate state law but are not listed in the "gambling" definition found in subsection (b)(2). Indeed, the only other court to expressly address this issue in United States v. Atiyeh supports this conclusion. In Atieyh, the US Court of Appeals for the Third Circuit concluded that a violation of state law alone was sufficient to trigger liability under the IGBA. Yet DiCristina could do nothing more than distinguish Atiyeh on the basis that it failed to resolve the ambiguities in the text and history of the IGBA. On some level, the DiCristina court equally failed to resolve the same ambiguities; it just reached a divergent conclusion.

Additionally, the IGBA was designed to do precisely what a striking amount of federal laws that have criminalized state statutes have done: use a jurisdictional hook to provide federal prosecutors with a means of achieving their own specific agenda. Under the IGBA, the jurisdictional hook is the two additional elements under (b)(1), which requires that the "illegal gambling business" (1) involve five or more persons who own or manage the business and (2) either remains in business for more than 30 days or has a gross revenue of $2,000 in any single day. While these may be characterized as separate federal elements, they are nothing more than the jurisdictional hook that provides federal prosecutor with the ability to address concerns of those that have historically been state issues. But the jurisdictional hook goes no further. Although Congress may have included examples of specific gambling businesses under subsection (b)(2), nothing in the structure of the statute, the legislative history or the law's purpose suggests that the list was meant to be part of the jurisdictional hook. From a textual and logical perspective, had Congress intended subsection (b)(2) to be a prerequisite to jurisdiction it could have included it as an element under (b)(1).

While Weinstein concluded that poker is a game predominated by skill and not chance, the DiCristina opinion carries limited precedential value on future cases prosecuted under the IGBA because most illegal gambling prosecutions are primarily [PDF] handled under state prosecutorial authority. More importantly, the court in DiCristina was only able to conclude that poker was not actionable under the IGBA because it created this new prerequisite of meeting the purported federal definition of "gambling" under subsection (b)(2). This begs the question: how far does DiCristina advance the cause that poker is truly a game predominated by skills and not chance? Even if DiCristina becomes authoritative or perhaps persuasive on the issue of whether poker is a game predominated by skill, it seems less apparent whether other federal courts will jump through the same interpretive hurdles to reach that conclusion.

In sum, even if DiCristina lends support to a normative approach of legalizing poker in the federal arena, its fails to address the IGBA's reliance on the multitude of state law statutes and state law decisions that have unequivocally deemed poker an illegal gambling activity.

Renè DuBois is an articles editor for the New York Law School Law Review and a member of the Moot Court Association.

Suggested citation: Renè DuBois, United States v. DiCristina: the Interaction of Federal and State Law, JURIST - Dateline, Mar. 15, 2013, http://jurist.org/dateline/2013/03/rene-dubois-gambling-law.php

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