Another Twist to the Kentucky Case

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The Kentucky Internet gambling cases refuses to fade away. Matters last stood as follows. The Kentucky Supreme Court had asked iMEGA to name at least one of its clients if it wanted the court to consider its arguments on merit in the domain names seizure case. Accordingly in March 2010 iMEGA had submitted an affidavit from Yatahay Limited, owner of the TruePoker.com domain name, to establish that one or more of the affected domain name owners were members of iMEGA. The Supreme Court was now to rule in the matter. Pending this decision, the state of Kentucky had filed another suit, this one against Pocket Kings, the purported operators of Full Tilt Poker. On Wednesday August 11, the state of Kentucky filed an amendment to its suit adding the name of PartyGaming. Since PartyGaming had quit the United States online gambling market with the passage of UIGEA in 2006, the filed amendment focused on PartyGaming servicing Kentucky Internet gamblers just before that.

The reason for the inclusion of PartyGaming by the state of Kentucky is presently a matter of speculation by industry watchers. Some say that PartyGaming had earlier agreed to a multi-million dollar settlement with the federal Department of Justice and is therefore perceived as a soft target. Another reason offered is that PartyGaming is a big listed company with clearly known shareholders and therefore more easy to sue than other names with nebulous owners. A third reason is that two of the largest shareholders of PartyGaming, Russ De Leon and Ruth Parasol, have refused to settle with the Department of Justice in their individual capacities and this could be one way of pressurizing them. A fourth reason, given by iMEGA chairman Joe Brennan, is that Kentucky sees an opportunity for exploiting PartyGaming because its merger with bwin is underway.

It has been confirmed that the legal counsel for the state of Kentucky, Hurt, Crosbie & May, have sent a letter to Mr. Jim Ryan, Chief Executive Officer of PartyGaming, notifying him of the pending lawsuit. The letter refers to a period from August 5, 2005 to October 13, 2006 and claims that, under Kentucky law, those transactions are void and the state is entitled to recover triple the amount lost by Kentucky residents. Party Gaming has not as yet commented on its inclusion in the amended appeal. However only last week Ryan had gone on record stating that there are now no hurdles for PartyGaming receiving an appropriate license as and when the American market gets regulated.

The claim against Pocket Kings, the original company targeted by the state of Kentucky, is for the period between March 2005 and September 2009. Pocket King continues to operate in the United States and is one of the biggest backers of the Poker Players Alliance who are the prime movers behind Barney Frank's anti-UIGEA bill.

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