Court Upholds U.S. Ban on Internet Gambling (Online Gambling)

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A U.S. appeals court upheld a federal ban on Internet gambling, but the ruling appeared to open the door for states to have more say on the matter.

In a decision handed down Tuesday, the U.S. Court of Appeals for the Third Circuit rejected a claim by New Jersey-incorporated Interactive Media Entertainment & Gaming Association that current laws aimed at cracking down on online gambling are too vague, unconstitutional and infringe on an individual's right to privacy. The decision comes amid a struggle between the Justice Department, which wants to shut down the online-gambling industry, and several members of Congress who are advocating legalization and view it as a potentially important revenue generator.

The court's decision upheld the Unlawful Internet Gambling Enforcement Act of 2006, which banned credit-card companies or other institutions from processing payments for online betting.

"We're disappointed that the court didn't overturn the law," said Joe Brennan Jr., chairman of Interactive Media, which sued the Justice Department, the Federal Reserve and the Federal Trade Commission. But, he said that language in the decision appearing to place the issue under state jurisdiction was a silver lining.

"We lost the decision," he said. "But the court gave us an awful lot to work with going forward."

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Court Upholds U.S. Ban on Internet Gambling - WSJ.com