Contact us with your California corporate & securities law questions (949) 353-6347 or Contact us here

Not All Sports Betting May Be Legal In Nevada

Last August, Nevada Secretary of State Barbara Cegavske issued a Summary Order to Cease and Desist on Thomas Becker and Wellington Sports Club, LLC, Einstein Sports Advisory, Ltd., and Welscorp, Inc.  The gist of Secretary of State's allegations is that the respondents' sports betting model is a security.  Shortly thereafter the Securities and Exchange Commission filed a civil complaint against Mr. Becker and several other individuals and entities.  The SEC alleges, among other things, violations of  Section 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5, and the registration provisions of Section 5(a) and 5(c) of the Securities Act.  

Earlier this month, several of the defendants in the SEC action moved to dismiss the SEC's action, arguing that gambling contracts are not securities and cannot be regulated as such, "because the 'investor' never gains an interest in an underlying asset - such contracts rest on on the outcome of a game".  The SEC argue that the defendants' contracts are investment contracts under SEC v. W.J. Howey, 328 U.S. 293 (1946).  The SEC also rejects the defendants' argument that the regulation of gaming under other laws precludes SEC jurisdiction.  
 
U.S. District Court Judge Andrew P. Gordon will decide.
Share on:

securities fraud

ANY QUESTIONS REGARDING CALIFORNIA CORPORATE AND SECURITIES LAW? CONTACT US DIRECTLY

We offer expert advice with the intricacies of California law.

Our years of experience and expertise allow us to help clients navigate the business laws in California.

CONTACT US

ABOUT OUR AUTHOR

30172DBAB0084D3A8F39D7AF0A8E79BC.ashx Keith Paul Bishop
Partner at Allen Matkins
(949) 353-6328
 Contact me
Learn More About Keith

RECOGNITION

NationalLawReview

badge-author-large

nominee-badge

Get the latest news and analysis about California Corporate & Securities law. Subscribe to our newsletter today!

We respect your email privacy

CATEGORIES

see all

YOUTUBE

FACEBOOK