U.S. News

Kentucky to Sue Poker Site for Residents' Losses

Joseph Menn, Financial Times

Kentucky officials have opened a new front in the fight against internet poker, suing the owners of Full Tilt Poker, the US-oriented gambling site, to recover five years’ of losses by residents of the state.

gavel and money

The first such case brought in the US suggests that even if Congress moves towards legalising internet gambling, the prospects will be murky for companies that have continued to serve the US market even after the ban imposed in 2006.

The legalisation most likely to be considered by Congress would leave regulation to the states, which could each take action that affects companies severely. In Kentucky, horseracing is a powerful authorised rival to online gambling.

J. Michael Brown, Kentucky’s governor-appointed secretary for justice, has in the past sued to seize FullTiltPoker.com and more than 100 other internet addresses, arguing that the domain names were gambling devices that could be forfeited under state law. Mr Brown won the initial round in that suit and has been battling in appellate courts since then.

Mr Brown’s new suit in Franklin Circuit Court lists as targets the unidentified owners of those websites but specifically names Pocket Kings of Dublin, thought to be the co-owner of Full Tilt.

“Through the course of the litigation, attorneys were able to confirm the identities of one of the owners,” said Jennifer Brislin, Mr Brown’s spokeswoman.

An industry group that has been contesting the move against the domain names derided the new case as a quest for money by the lawyers pursuing a contingency fee.

Joe Brennan Jr of the Interactive Media Entertainment & Gaming Association said that the lawyers employed by the state had asked for $1bn in a settlement discussion.

Mr Brennan said that placing an internet bet in Kentucky was not illegal and that the new suit relies on a statute which is more than a century old that permits not only the losing gambler in an illegal game to recover tripled damages but, after more than six months have elapsed, anyone else to make the same claim.

The case further complicates the lives of those behind Full Tilt, who face a federal grand jury investigation.

Full Tilt has attracted attention by sponsoring a team of professional stars who have attracted US law enforcement attention because they have been identified as designers of the Full Tilt site, which is ostensibly run from the UK Channel Islands.

The Pocket Kings attorney did not return calls seeking comment.