PartyPoker Stock Rises on Settlement Speculations with DOJ
The owner of PartyPoker saw a 10% increase in stock value amid speculations that the company had reached a settlement with the Department of Justice (DOJ). Despite these rumors, no formal charges were filed against PartyPoker. In June 2007, PartyGaming announced that it was in discussions with the U.S. government.
The Settlement Negotiations
PartyGaming sought to reach an agreement with the U.S. government to avoid legal action for accepting online bets from American players. The proposed settlement would have marked the first penalties imposed on an online casino by the U.S. government. Previously, DOJ penalties and charges had been focused on online sports betting enterprises.
Legal Context
The DOJ has consistently maintained that all online gambling is illegal under the Federal Wire Act. Originally, the Federal Wire Act applied solely to sports betting. To date, the Supreme Court has not ruled on whether the act also encompasses other forms of online gambling.
