Enforceability of 18 U.S.C. § 1302
| Citation | 24 Op. O.L.C. 1 |
| Decision Date | 25 September 2000 |
| Docket Number | 00-1 |
| Court | Opinions of the Office of Legal Counsel of the Department of Justice |
| Parties | Enforceability of 18 U.S.C. § 1302 |
Application of 18 U.S.C. §1302 to prohibit the mailing of truthful advertising concerning certain lawful gambling operations would violate the First Amendment. Accordingly, the Department of Justice will refrain from enforcing the statute with respect to such mailings.
This is to inform you of the Department of Justice's determination that, in light of governing Supreme Court precedent, the Department cannot constitutionally continue to apply 18 U.S.C. § 1302 to prohibit the mailing of truthful information or advertisements concerning certain lawful gambling operations.
The central opinion that informs the Department's decision is Greater New Orleans Broadcasting Ass'n v. United States, 522 U.S. 173 (1999). In that case, an association of Louisiana broadcasters and its members challenged the constitutionality of the federal statute prohibiting the broadcasting of information concerning lotteries and other gambling operations. The statute in question, 18 U.S.C. § 1304 (1994), provides in relevant part:
Whoever broadcasts by means of any radio or television station for which a license is required by any law of the United States . . . any advertisement of or information concerning any lottery, gift enterprise, or similar scheme offering prizes dependent in whole or in part upon lot or chance . . . shall be fined under this title or imprisoned not more than one year, or both.
The broadcasters sought permission to broadcast advertisements for lawful casino gambling in Louisiana and Mississippi. The Supreme Court held that the First Amendment prohibits application of § 1304 "to advertisements of private casino gambling that are broadcast by radio or television stations located in Louisiana, where such gambling is legal." 527 U.S. at 176.
The Court reviewed the constitutionality of § 1304 under the "commercial speech" test of Central Hudson Gas & Elec. Corp. v. Public Service Comm'n, 447 U.S 557 (1980). See Greater New Orleans, 527 U.S. at 183. Under that test, when a government regulation restricts truthful speech proposing lawful commercial activity, the court must "ask whether the asserted governmental interest is substantial." Central Hudson, 447 U.S. at 566. If the interest is substantial, the court determines whether the regulation "directly advances the governmental [ 2] interest asserted" and whether it "is not more extensive than is necessary to serve that interest." Id. As the Court observed in Greater New Orleans, "the Government bears the burden of identifying a substantial interest and justifying the challenged restriction." 527 U.S. at 183.
In the Greater New Orleans case, the government identified two basic governmental interests served by § 1304: minimizing the social costs associated with gambling or casino gambling by reducing demand, and "assisting States that 'restrict gambling' or 'prohibit casino gambling' within their borders." 527 U.S. at 185-87. The Supreme Court determined that, as applied to truthful advertising for lawful casino gambling by broadcasters located in states that permit such gambling, § 1304 does not directly advance either interest and is an impermissibly restrictive means of serving those interests. Id. at 188-96.
As to the government's interest in minimizing the social costs of casino gambling by reducing consumer demand, the Supreme Court concluded that "[t]he operation of § 1304 and its attendant regulatory regime is so pierced by exemptions and inconsistencies that the Government cannot hope to exonerate it." Id. at 190. The Court pointed to the various exceptions that Congress has engrafted onto § 1304 over the years, particularly the exception for broadcast advertisements for Indian gambling (see 25 U.S.C §2720 (1994)). The Court concluded that by permitting advertisements for Indian casino gambling and certain other kinds of gambling to be broadcast on a nationwide basis, Congress had effectively made it impossible for § 1304 to accomplish its original goal of minimizing the social costs of gambling by reducing consumer demand. In addition, the Court noted that Congress could have employed various "practical and nonspeech-related forms of [casino gambling] regulation, " such as restrictions on casino admission and credit, that "could more directly and effectively alleviate some of the social costs of casino gambling." 527 U.S. at 192.
The Court also determined that the other asserted governmental interest, that of assisting States that restrict casino gambling, "adds little to [the government's] case." Id. at 194. First, the statutory exceptions that prevented § 1304 from directly and materially advancing the federal government's interest in minimizing the social costs of casino gambling were equally inimical to the efforts of non-casino states: "We cannot see how this broadcast restraint, ambivalent as it is, might directly and adequately further any state interest in dampening consumer demand for casino gambling if it cannot achieve the same goal with respect to the similar federal interest." Id. (emphasis added). Second, the Court concluded that § 1304 "sacrifices an intolerable amount of truthful speech about lawful conduct when compared to all of the policies at stake and the social ills that one could reasonably hope such a ban to eliminate." Id. The Court reasoned that prohibiting casino gambling advertisements in all States in order to protect the interests of non-casino States is ' 'neither a rough approximation of efficacy, nor [ 3] a reasonable accommodation of competing State and private interests." Id. at 194-95. The Court concluded by stating:
Had the Federal Government adopted a more coherent policy, or accommodated the rights of speakers in States that have legalized the underlying conduct, see [United States v.] Edge [Broadcasting Co.], 509 U.S. [418, ] 428 [(1993)], this might be a different case. But under current federal law, as applied to petitioners and the messages that they wish to convey, the broadcast prohibition in 18 U.S.C. § 1304 and 47 CFR § 73.1211 violates the First Amendment.
After the Greater New Orleans decision was issued, the Department was required to consider whether the application of § 1304 to the broadcasting of truthful advertisements for lawful casino gambling violates the First Amendment, regardless of whether the statute is applied to broadcasts originating in States that permit casino gambling (as was the case in Greater New Orleans) or in States that do not. This question arose in the case of Players International, Inc. v. United States, 988 F.Supp. 497 (D.N.J. 1997), appeal pending, No. 98-5127 (3d Cir. 1999). In a supplemental brief submitted to the Third Circuit on behalf of the United States, the Justice Department observed that "while the Court's holding in Greater New Orleans is confined to broadcasts originating in casino gambling States, the Court's reasoning indicates that section 1304, as currently written, cannot constitutionally be applied to broadcasts originating in non-casino States either." See Supplemental Brief for the Appellants at 6 (emphasis in original), Players Int'l, Inc. v. United States (No. 98-5127) ("U.S. Brief). This view reflected the conclusion that the same deficiencies and inconsistencies that the Court in Greater New Orleans held to undermine the government interests there were also present when the statute was applied to broadcasts originating in non-casino States.
As noted above, the Court in Greater New Orleans found that § 1304 did not directly advance the government's interest in minimizing the social costs of casino gambling because the statutory exceptions to § 1304, particularly the exception for Indian gambling, preclude the statute from meaningfully reducing public demand for casino gambling. See 527 U.S. at 193-95. The exception for Indian gambling is nationwide in scope: advertisements for Indian gambling may be broadcast in every State, including States that prohibit private casino gambling. See 25 U.S.C. § 2720. The same is true of the other statutory exceptions to § 1304 [ 4] except for the one covering state lotteries. See 18 U.S.C. § 1307(a) (1994). As a result, the Department determined that there is no reason to believe that § 1304 is any more effective in minimizing the social costs of casino gambling for residents of non-casino States than it is for residents of casino States. See U.S. Brief at 7.
The Court in Greater New Orleans also held that § 1304 was an impermissibly restrictive means of dealing with the social costs associated with casino gambling because those costs "could [be] more directly and effectively alleviate[d]" by "nonspeech-related forms of regulation." 527 U.S. at 192. The Department concluded that this determination, too, is equally applicable with respect to broadcasts originating in non-casino States. If measures such as "a prohibition or supervision of gambling on credit" are more effective than § 1304 with respect to gamblers who live in States that permit casino gambling, as the Court found, they would appear to be equally effective as to gamblers who visit from non-casino States. Id.
Finally the Department decided that the Court's conclusion in Greater New Orleans that the federal goal of assisting non-casino States "adds little to [the] case, " id. at 194, also holds true with respect to the application of §1304 to broadcasts originating in non-casino States themselves. The Court stressed the fact that the "ambivalent" federal advertising restriction, with its...
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