Intellectual Property Law

No On-line Gambling for You, Minnesotans

By Tim Armstrong, Derek Bambauer, and William McGeveran.

Minnesota’s Department of Public Safety has instructed the state’s ISPs to block access by state residents to a list of gambling sites, claiming authority under the Wire Act (18 U.S.C. 1084). The Department’s theory is that 1) gambling is illegal in Minnesota, and 2) the Wire Act requires common carriers to stop furnishing services to such unlawful Web sites. Here’s the relevant text from the Wire Act (18 U.S.C. 1084(d)):

When any common carrier, subject to the jurisdiction of the Federal Communications Commission, is notified in writing by a Federal, State, or local law enforcement agency, acting within its jurisdiction, that any facility furnished by it is being used or will be used for the purpose of transmitting or receiving gambling information in interstate or foreign commerce in violation of Federal, State or local law, it shall discontinue or refuse, the leasing, furnishing, or maintaining of such facility

There are at least three reasons why this won’t fly (or float? Need to work in a “Land of 10,000 Lakes” joke here). First, ISPs aren’t common carriers. Second, the Minnesota order is likely unconstitutionally overbroad. Third, there’s a serious dormant Commerce Clause problem given the financial repercussions for ISPs. In short, this attempt is like Brett Favre’s career: dead no matter how hard interested Minnesota parties try to revive it.

First, the common carrier problem: in National Cable & Telecommunications Association v. Brand X Internet Services, 545 U.S. 967 (2005), the Supreme Court deferred to the Federal Communications Commission’s ruling that, under the Communications Act of 1934, cable broadband providers are “information service providers” and not “telecommunications carriers.” Hence, cable broadband isn’t subject to common carrier regulation. The case doesn’t directly address DSL broadband, but the FCC’s logic likely applies there as well. So, the basis for Minnesota’s invocation of the Wire Act - that ISPs are common carriers - seems to run counter to both the Supreme Court’s holding and the FCC’s rulemaking. But what do they know?

Second, this situation looks a lot like Center for Democracy & Technology v. Pappert, 337 F. Supp. 2d 606 (E.D. Pa. 2004). There, a Pennsylvania law required ISPs to block access to sites pinpointed by the state Attorney General (that allegedly contained child pornography). The ISPs responded by blocking the IP addresses of the offending sites. Result: massive overblocking - the ISPs filtered about 1.1 million innocent sites to squash 400 bad ones. Minnesota ISPs might use IP blocking also, since URL filtering is expensive (see next point). Declan McCullagh notes that GetMinted.com, a blacklisted site, shares an IP address with Cashcade, a corporate site. The blacklist is underinclusive - does anyone think the Dept. of Public Safety has found all of the Internet gambling sites? - and overinclusive - because gambling companies will migrate away from blocked URLs, and because IP blocking always catches up unrelated sites.

Finally, the Wire Act itself, and the burden URL filtering would place on ISPs, creates a major dormant Commerce Clause problem. The Constitution’s Commerce Clause gives Congress power to regulate interstate and international commerce; importantly, it also keeps individual states from doing things that overly burden this commerce. The Wire Act shows that Congress is already regulating interstate gambling issues, meaning that states are likely pre-empted from tackling the same problem. Moreover, as the Pappert court noted, it’s quite expensive for ISPs to install URL filtering technology (at 629-34). There’s rarely a single “choke” point in the network where one can put a filter in place, and effective filtering usually slows network transfer speeds. (Australia is grappling with exactly these problems.) Thus, if Minnesota forces ISPs to adopt costly technology to meet its local gaming preferences, that’s clearly a burden on interstate commerce. (See Pappert at 645-46.) Since blocking doesn’t fall within Congressional authorization under the Wire Act, it probably runs afoul of the Commerce Clause.

I think this is bad law and benighted policy. If it gets to a court challenge, I’d be delighted to collaborate with other cyber-folks on an amicus brief explaining exactly why this is. So, I’ll give odds: 2:1 says the Department quietly drops this plan; 1:1 the ISPs politely refuse to comply; 1:2 Brett Favre signs with the Vikings, whose fans quickly come to appreciate Tavaris Jackson…

[Oh no! Now they're filtering Info/Law!]

Update (5 May 1:00PM): I thought it might be helpful to list the 11 ISPs: Charter Communications, Comcast Cable, Direct TV, Dish Network, EMBARQ, Qwest, Sprint/Nextel, Verizon Wireless, AT&T Internet Services, Wildblue, and Frontier all received notices; the FCC received a copy as well.

Full post as published by Info/Law on May 05, 2009 (boomark / email).