ISPs Are Content with the Leach Bil

The leading lobbying group for U.S.-based Internet service providers told IGN today it does not oppose U.S. Rep. James Leach's, R-Iowa, anti-Internet gambling bill, despite a recently added provision holding ISPs somewhat liable for the enforcement of the law.

Dave McClure, president and CEO of the United States Internet Industry Association (USIIA), said ISPs were initially concerned when media reports suggested that the Internet Gambling Enforcement Act (HR 556) would make them accountable for advertising and hosting any online casinos.

"It has always been our contention that it isn't our place to determine what is and isn't acceptable in our society, but if the legislature and the courts tell us to take something down, we will."

-Dave McClure
USIIA

But the language in the legislation, he said, isn't that simple.

The bill, which passed in the House on Tuesday, aims to prohibit Americans from gambling through offshore Internet sites beyond the jurisdiction of the United States. It prohibits U.S.-based financial institutions from facilitating gambling-related transactions online.

The much talked about ISP provision could require ISPs to block access to or pull advertising from offshore Web gambling sites. In either case, a federal or state court order would be required, and ISPs would be under no legal obligation to police their networks for gambling advertisements.

The "no-obligation" clause is what got the USIIA and McClure behind the bill.

"We have also followed reasonable court orders," McClure said. "It has always been our contention that it isn't our place to determine what is and isn't acceptable in our society, but if the legislature and the courts tell us to take something down, we will."

Nevertheless, Frank Catania, a former director of the New Jersey Division of Gaming Enforcement, feels ISPs are still being relied on too heavily to enforce the law. He advised that, if passed, the Leach bill could start a slippery slope in other areas of e-commerce.

"Can you imagine a court order being issued against a site because they are operating with no sales tax or something like that?" he said. "I know of no other area in e-commerce that is being legislated in such a way. If this is the approach they are going to take here, then what is next?"

The ISP provision was added to the Leach bill after Leach reached a compromise with Sen. Jon Kyl, R-Ariz., who has long been the Senate's leading advocate of Internet gambling prohibition. When the two discussed combining their bills, they agreed to hold the ISPs accountable, even if on a limited basis.

The details of the compromise weren't made public until a few days before Tuesday's vote.

"I know of no other area in e-commerce that is being legislated in such a way. If this is the approach they are going to take here, then what is next?"

-Frank Catania
Catania Consulting

ISPs have been closely watching the legislation because of the potential liability involved in running ads from offshore casinos.

What the USIIA opposes are state-level tactics to block "offensive" material. McClure pointed to Pennsylvania's passage of a state law calling on ISPs to block links to porn sites located overseas.

"They have an attorney general there that is running for governor, telling people how many thousands of sites he has blocked," he said. "They haven't blocked anything in Pennsylvania because anyone who knows how the Internet works knows it is nearly impossible to block sites."

McClure said the USIIA neither supported nor opposed the Leach bill. He said the association is in favor of trying to protect users from unscrupulous online operators, but he doesn't want to see ISPs used as the policing mechanism, as proposed in previous legislation that failed to pass.

Regardless, McClure said he doubts the Leach bill will pass the Senate before the legislature adjourns for its pre-election recess.

If the bill fails to gain Senate passage before the end of the year, it would die and have to be re-introduced in both chambers.