Kentucky Domain Seizures Case Imperils Online Gambling

Our story begins on September 18 with Kentucky Governor Steve Beshear ordering a lawsuit filed against 141 online gambling operators. The suit is a civil suit formally filed by Attorney General Michael Brown on behalf of Kentucky to seize and confiscate internet domain names used to promote or provide illegal gambling in the state. Domains include a number of other names as well as industry-leading names such as , , and .

Judge Wingate of Franklin Circuit Court in Kentucky surprised the industry by not only dismissing the case, but also withholding it and ordering registrants to transfer domain names to Kentucky. The rationale for the whole case depends on the definition of a domain name in Kentucky that qualifies as a gambling device, and it is clear that Judge Wingate agreed. A hearing has been set for October 7 so that both sides can agree on the case.

Industry groups such as Interactive Gaming Council (IGC), Poker Players Alliance (PPA), and Interactive Media Entertainment Gaming Association (iMEGA) have been arm in arm over the case, with several suing the case as “friends of the court.” Issues raised include poker’s status as a game of chance or skill, whether a domain can be defined as a “gambling device,” and whether Kentucky has jurisdiction.

The judge wanted to review all the information presented over the course of a week, acknowledging that the verdict had not been handed down until October 15 because it was a very complex matter. Until now, most of the websites were in operation, except for a few that the registrar had already moved. To everyone’s dismay, the ruling upheld the seizure and ordered a forfeiture hearing on December 17. All sites involved should be geo-blocked to block Kentucky residents from using the site at all. If this does not prove to be working properly, the domain will be confiscated.

There are many aspects of this case that disrupt the gambling industry. The apparently discriminatory way Beshear authorizes online horse racing betting as part of the state’s “signature industry” while attempting to stop what he calls “illegal online gambling” is one of the big disruptors. Another aspect is the concern that if one state can avoid taking control of the domain as well as other states, so will other states.

The important issue with this case and its resolution is what the precedent sets can mean for all businesses operating online. For example, let’s say cell phones are legal in the United States but illegal in Canada. So will Canada be given the right to seize the domain of a mobile phone manufacturer or wireless operator? Allowing domain foreclosures would open Pandora’s box of issues with jurisdiction around the world, and opponents fear this could mean the end of the internet as we know it. 바카라사이트