One month ago, the Kentucky Supreme Court heard arguments in a case that pits the state’s Justice and Public Safety Cabinet against the owners of 141 internet gambling domain names, including those belonging to industry titans like PokerStars and Fill Tilt Poker.
Heading the Cabinet is J. Michael Brown, who was present during oral arguments in the Frankfort courtroom and brought the legal action against the domain names in question one year ago. Brown told Poker News Daily that nothing discussed during the October 22nd hearing caught him off-guard. He added, “In discussing some of the procedural background, members of the court touched on some of the underlying issues, everything from whether a domain name is a device and how a device is defined to what measures the Commonwealth can employ to defend itself against unregulated internet gambling.”
Representing the internet gambling sites were a consortium of lawyers, including those from the Interactive Media Entertainment and Gaming Association (iMEGA), the Interactive Gaming Council (IGC), and several of the targeted sites. Despite the large presence of trade organizations during the proceedings, Brown and company questioned why no domain owners had come forth to defend themselves. The Secretary told Poker News Daily, “Who were the stakeholders on the other side? There didn’t seem to be anyone standing up saying that they represent these innocent owners. Their arguments were all over the map, from the First Amendment to likening it to a criminal proceeding. I was pleased that the court spent time looking at the underlying issues.”
Many in the industry have cautioned that the outcome of the Kentucky internet gambling case may set a precedent worldwide. More light could be shed on where domain names are located and who has rights to seize or regulate them as a result of the seven-member Kentucky Supreme Court’s decision. On the global implications of the Commonwealth’s actions, Brown frankly stated, “I’m only focusing on Kentucky. Our interest is in the unregulated gambling that we believe has been going on. I don’t know that our Supreme Court is ready to look at it as a worldwide precedent because a lot of the underlying facts haven’t been completely developed.”
Influencing the Commonwealth is the presence of a booming horse racing industry in Kentucky, headlined every May by the running of the Kentucky Derby. The spectacle, which unfolds from Churchill Downs in Louisville, generates a considerable amount of revenue for the State, bringing in high rollers, celebrities, politicians, and horse racing fans from around the globe.
The 141 internet gambling domain names are owned by companies located in places like Costa Rica, Gibraltar, Canada, and Isle of Man. Brown explained, “You have people who own and operate domain names. In order to regulate them, you have to go to the registrars because the actual owners are all offshore.” Registrars include giants like GoDaddy.com, which features Team PokerStars Pro member Vanessa Rousso as one if its spokesmen.
When the Kentucky Supreme Court will hand down a decision in the case is not yet known. Joe Brennan, Chairman of iMEGA, told Poker News Daily that he would set an over/under of March, 2010. Rich Muny, Kentucky State Director for the Poker Players Alliance (PPA), contrastingly, expected a decision to be rendered by Christmas.
The 141 internet gambling domain names were seized in September of 2008 on the grounds that they were illegal “gambling devices,” a term that traditionally refers to tangible objects like slot machines and roulette wheels that you’d find in an underground casino. Judge Thomas Wingate upheld the Commonwealth’s actions one month later before the industry sought the intervention of the Kentucky Court of Appeals. The judicial body ruled against the State by a two-to-one margin in January, setting up October’s showdown in the Kentucky Supreme Court.
Stay tuned to Poker News Daily for the latest from the Commonwealth of Kentucky.
