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Opinion and Order in Kentucky Online Gambling Domain Case (In Its Entirety)

Written by:
C Costigan
Published on:
Oct/16/2008
Kentucky Court Gambling Domain Decision

Edward Leyden, President of The Interactive Media Entertainment & Gaming Association, on Thursday declared "We are going to fight like Hell".

He referred to the appeals that will be filed in both a Federal and Kentucky state court related to a dangerous decision handed down in a Frankfort Circuit Court Thursday.

While the decision today by Kentucky circuit court Judge Thomas Wingate to order a forfeiture hearing for 141 domain names dealt primarily with the Internet gambling industry, the affect of this ruling will be felt across the entire online world.

Kentucky circuit court Judge Thomas Wingate has ordered owners of 141 domain names to appear at a November 17th forfeiture hearing, and demonstrate that they are blocking traffic from Kentucky. If the domain owners do not appear, or if they do not screen Kentucky traffic, the domains will be forfeited to the commonwealth.

In issuing his ruling, Judge Wingate misapplied several existing Kentucky laws - in particular, the law defining "gambling devices" - and long-standing principles regarding his court's jurisdiction over the matter. The judge even reached back to law that was revoked more than 30 years ago to shoehorn the definition of domain names into a so-called definition of gambling devices.

Operators of sites in other Internet sectors - such as social networking, video gaming, adult entertainment, even political and religious sites - may soon find themselves the targets of jurisdictions seeking to control them or shut them down entirely.

"What Judge Wingate has done is to create the ‘ultimate weapon' to be used by the powerful and influential to attack content they oppose," said Joe Brennan Jr., chairman of iMEGA. "This will enable government to eliminate competition from differing ideas, beliefs and commerce. This decision today is where it starts, but where will it stop?"

Brennan said iMEGA had already prepared for this possible result from the Kentucky court, and will challenge this decision at both the Federal and State courts, to prevent "this cancer from metastasizing and threatening the entire online world."

Leyden does believe the Judge did everything he could in this matter but that the case was being heard in the wrong court.

"Judge Wingate worked his butt off to come up with a fair solution," Leyden told Gambling911.com.

Leyden will be filing in both a state and Federal court at the same time. His organization was not granted standing on November 17 since forfeiture hearings require owners to appear on their own behalf.

"This decision opens the door for any domain name to be seized. If you are offering offensive content on the Net, your domain can be seized," Leyden points out.

The Huffington Post writing bad things about Sarah Palin - Domain name can now be seized.

Drudge Report featuring a link to article deemed offensive - Domain name can now be seized.

Limitations? There really are none.

"You need to feel a real sense of fear today if you own a website that may in any way offend someone," expressed Leyden.

Lawyers representing the commonwealth of Kentucky might not be happy with the decision either. The money incentive to show up and pay a steep fine has now been taken off the table.

Jimmy Johnson, representing 8 online gambling clients, pointed out during his argument that attorneys on behalf of the state stood to make a "generous cut" from each online gambling firm that decided to settle. None did and they no longer can.

So what will happen November 17?

"In theory, some poor schlep shows up in Frankfort, Kentucky on November 17 and says to the Judge ‘I am here representing XYZ Online Gambling Company and here is a receipt to show that I have purchased a geo-targeting device to block Kentucky residents from accessing the website.' That individual is opening themselves up and could ultimately be subpoenaed. The judge implies immunity in his decision but that is a really hard call."

A copy of the decision can be found here.

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Christopher Costigan, Gambling911.com Publisher

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