CROSS-BORDER JURISDICTION
in multiple international forums, highlights the broader implications of Malta’s regulatory overhaul, raising critical questions about its impact on worldwide gaming regulations and cross-border legal compliance. While Malta’s actions continue to garner attention in Europe, and as EU member states continue to raise concerns about Bill 55 and similar legislation aimed at protecting domestic operators in the context of the European Economic Area, other jurisdictions must also address the question as to the best way to handle violations of their laws and regulations by Malta-based operators, and what, if any, action they can take to incentivize compliance and control unregulated gambling within their borders. Criminal Judgments Within the United States, unlawful forms of gambling are recognized as a crime at both the state and federal level. A significant majority of states still criminalize online casino gaming (other than sports wagering), and as such no legalized, regulated market for such games exists across most of the country. The result has been an influx of offshore, black- market offerings appearing online and proliferating across the country. Given that these entities are generally not licensed within the jurisdiction(s) that they are operating in, and that frequently these entities have little to no presence in these jurisdictions either, bringing criminal cases can prove difficult for regulators and their law enforcement colleagues. Foreign penal judgments are not generally given comity by U.S. states. 1 Judgments based on laws that are determined to be penal, such as criminal laws, laws that recover to the state, and laws that recover to strangers, are considered by U.S. courts to be exceptions to the Full Faith and Credit requirements
of the U.S. Constitution. 2 Similarly, U.S. Courts decline to enforce penal laws of other sovereign states, flowing from the presumption against extraterritoriality 3 and the concern that crimes can only be prosecuted in the country in which they were committed. 4 However, criminal judgments can still prove to be effective deterrents in some instances, if certain hurdles can be overcome. First, an enforcement agency must ensure that the state can exert jurisdiction of the allegedly offending entity. To acquire jurisdiction over a nonresident that is not personally served within the forum state, it will be necessary to demonstrate that the entity has certain “minimum contacts” with the forum state so that the suit does not offend the notions of fair play and substantial justice. 5 Courts have found that suing nonresidents for doing business on the internet where they have a real and continuous presence or where the nonresident has caused an injury comports to due process requirements. Specifically for determining the jurisdictional hook for nonresidents based on internet presence, courts look to the level of commercial activity associated with the website. Simply having an interactive website is not enough. To exercise jurisdiction courts have found that (1) a nonresident must purposefully direct activities or consummate a transaction with the forum or a forum resident; (2) the claim must arise out of or relate to forum-related activities; (3) the exercise of jurisdiction must not offend fair play and justice. 6 Additionally, in criminal contexts, courts have also considered whether the conduct has some past, present, or anticipated locus or impact within the U.S, but the ultimate determination as to whether the exercise of jurisdiction is appropriate turns on whether the application of the statute to the criminal defendant would be arbitrary or fundamentally unfair. 7
After obtaining jurisdiction and, presumably, a conviction,
1 See Huntington v. Attrill, 146 U.S. 657 (1892). 2 See McKusick, W. The Penal Judgment Exception to Full Faith and Credit: How to Bind the Bounty Laws. Washington Law Review, Vol. 99, No. 2, June 1, 2024, pp.662-676. 3 See The Antelope , 23 U.S. (10 Wheat) 66, 123 (1825) (Justice Marshall recognizing that “[t]he Courts of no country execute the penal laws of another”) 4 In re Neves , 2019 U.S. Dist. Lexis 234849 (S.D. Fla.), citing to Pasquantino v. U.S., 544 U.S. 349, 361 (2005). 5 International Shoe Co. v. Washington , 326 U.S. 310 (1945). 6 Mavrix Photo, Inc. v. Brand Technologies, Inc. , 647 F.3d 1218, 1226-31 (9th Cir. 2011). 7 United States v. Davis , 905 F.2d 245, 249, n.2 (9th Cir. 1990); United States v. Medjuck , 156 F.3d 916, 918 (9th Cir. 1998).
PAGE 7
IMGL MAGAZINE | DECEMBER 2024
Made with FlippingBook flipbook maker