Ifrah Law Claims Success With Kentucky Web Gambling Domain Seizure Case
Ifrah Law PLLC, a Washington, D.C.-based law firm focused on complex civil and criminal litigation, secured a major victory for its client, the Interactive Gaming Council (IGC), on Friday when the Kentucky Court of Appeals ruled that the trade association could intervene in a long-standing in rem forfeiture proceeding on behalf its members.
Noted gaming attorney Jeff Ifrah, the founding member of Ifrah Law, led the charge in securing this precedent-setting win in a case that dates back to 2008, when the Commonwealth of Kentucky seized 141 domain names that it claimed were illegal gambling devices. While the IGC’s attempts to intervene on behalf of 61 of the domain name owners were initially rejected in the Franklin Circuit Court, the Court of Appeals found that the IGC did have standing to appear on behalf of its members and contest a forfeiture of those domain names.
Friday’s ruling resulted from Ifrah’s successful appeal, which focused on the associational standing test articulated by the United States Supreme Court in Hunt v. Washington State Apple Advertising Commission, and, specifically, the third prong of the test that grants associational standing only if the claim or relief requested does not require individual member participation. Ifrah convinced the court that associational standing is well suited for an in rem proceeding because the forfeiture affected a large number of property owners, whose claims were largely legal and could be resolved without the need for individualized proof.
“There is little sense in applying a rule that can deny an association from advocating on behalf of its members solely due to an overly technical application of it,” Ifrah said. “Instead we believe—and the court agreed with us—that the third prong must be applied flexibly in light of the specific nature of the claims and issues involved.”
Judge Allison Jones, writing for a unanimous three-judge panel, noted that Kentucky had treated the domain names as a group for most of the litigation.
“The Commonwealth cannot now turn the tables and ask the court to require each domain name owner to come forward individually and assert virtually identical legal arguments through separate counsel to resolve threshold, purely legal issues that affect the validity of the entire forfeiture procedure,” Jones wrote.
“This case has a long, complex, and somewhat tortured procedural history,” Jones also noted. It began in September 2008 when Kentucky, which prohibits online gambling, seized the domain names claiming they constituted “gambling devices” under Kentucky state law. After learning of the seizures from media stories, the IGC moved to contest the forfeitures on behalf of its members, some of whom owned the seized domains.
The case then winded its way through the state’s court system for the next five years, addressing what Ifrah called “a First Amendment issue, a dormant commerce clause issue, and an anyone-in-the-Internet business issue.”
“Trying to force 141 domain name owners to pursue their claims individually—filing extremely similar, but distinct motions and appeals—would be burdensome and inefficient,” Ifrah said. “Now that associational standing has been demonstrated, we will seek to reinstate the earlier Court of Appeals decision that domain names are not ‘property’ subject to forfeiture and do not constitute ‘gambling devices.’”
About Ifrah Law
Ifrah Law is a Washington, D.C.-based law firm that represents clients in a variety of litigation settings. Founded in 2009, the firm specializes in Internet advertising, igaming, government contracts and healthcare. Its attorneys also author two noted blogs: www.crimeinthesuites.com, an analysis of current issues in white collar defense, and www.ftcbeat.com, FTC and State AG News for Ecommerce. For more information, please visit www.ifrahlaw.com.
