By: Lawrence G. Walters
www.GameAttorneys.com

The courts have consistently recognized substantial similarities in the justifications for regulation of sex and gambling. Both are seen as "vice activities" that can be intensively regulated by the government. Although adult erotica is entitled to First Amendment protection - something that gambling lacks - both have been the subject of state and federal regulation throughout history.

Striking Similarities

Regulation of the land-based adult entertainment industry has most commonly taken the form of licensing, zoning and advertising regulations. Gambling activities have either been completely banned, or intensely regulated. Promotion of gambling activities has likewise been the subject of state and federal regulation, although to a lesser extent given the Free Speech protections applicable to commercial speech.

The test utilized by the courts to analyze the validity of an adult entertainment regulation is strikingly similar to the test employed to determine the validity of a gambling promotion regulation. Both tests require the court to make a finding whether the government has a "substantial interest" in regulating the activity. Both tests also require that the regulation be "narrowly tailored" or "no more extensive than necessary" to accomplish its intended goal.

The similarities do not end with the legal tests associated with sex and gambling regulations, however. The justifications asserted by the government as a basis for regulating these activities are virtually identical. Whenever the government attempts to regulate the flow of information regarding gambling activities, it introduces evidence of the following negative impacts:

Enter Online Sex and Gambling

The government's argument starts to self-destruct when applied to the online versions of erotica and wagering, however. Prostitutes and drug users do not commonly linger around adult Website businesses, most of which are operated from residential areas or office parks. Online erotica cannot be said to cause an increase in crime or a decrease in property values in the same way that topless bars and adult video stores have been alleged to generate these problems. The United States Supreme Court has recognized this critical distinction between real and virtual adult entertainment establishments in its unanimous opinion striking down the Communications Decency Act of 1996. In that decision, the Justices specifically recognized that the traditional justifications for "adult zoning" do not readily apply to regulation of adult Websites. Since the First Amendment prohibits the government from regulating speech based solely on its content, the only plausible justification for regulation of adult erotica is the alleged existence of these so-called "secondary effects." In the absence of any provable secondary effects generated from online erotica, the government has faced significant difficulty in regulating the content adult Internet businesses. In fact, both federal and state governments have lost repeatedly in courts across the country when attempting to regulate the dissemination of adult material on the Internet.

Thus far, the online gambling industry has failed to initiate similar constitutional challenges to gambling advertising restrictions on the grounds that the purported reasons for regulating land-based gambling advertising are not applicable to the online counterpart. It seems that the government would be hard-pressed to present evidence that online gambling is controlled or infiltrated by organized crime. Just as with online erotica, Internet betting does not generate increased prostitution, drug usage or other criminal activity typically associated with land-based casinos. Such legal challenges are inevitable, and if the courts follow the reasoning in the closely related adult erotica cases, they may very well succeed. Given the virtually identical justification used by the government to regulate these alleged vice activities, the online gambling industry can benefit from the constitutional ground paved by the online sex industry.

Lawrence G. Walters is a partner with the national firm Walters Law Group. The firm practices in the area of Free Speech regulation, Internet law, Gaming law and Advertising issues. Nothing in this article is intended as legal advice. Please consult with your personal attorney on specific legal issues.

You can reach Lawrence Walters at , larry@firstamendment.com
www.GameAttorneys.com or AOL Screen Name, "Webattorney."