Understanding The Legal Troubles of Full Tilt Poker

The major online poker room Full Tilt Poker has been under fire lately as a number of potential legal issues have arisen and become well-documented in the media. These problems have been so prominent that many players have begun to discuss whether or not they can safely keep money in what is the world’s second largest online poker room. Despite the widespread coverage of the issues, a closer inspection reveals a different conclusion. After looking closer at the issues that are being addressed, one of them is more or less a joke and while the other could be potentially disastrous there is really not enough information to call it an issue.

The one case in Kentucky is, quite frankly, a big load of nonsense and is just an attempt by the state of Kentucky and the lawyers prosecuting the case to make some serious scratch. Kentucky is attempted to seize the domain name of Full Tilt Poker and a number of other prominent online gambling sites because it “takes away from the gambling activities sanctioned by the state.” The crusade by Kentucky is not going as planned and their efforts to seize the domain names and Full Tilt has been singled out as it is the only defendant named in the lawsuit.

Kentucky attorneys are planning, however, to include all the companies that are behind the 141 different online gambling related domain names that they are attempting to seize. These companies are included in a category of “unknown defendants.” The attorneys for Kentucky do not know who the operators of the other websites and they only happen to know of Pocket Kings Ltd as a result of the civil suits that were filed against Full Tilt poker in other jurisdictions. The attorneys have requested the court to grant them a period of discovery which would allow them to determine the identities of the currently unknown defendants.

The fact of the matter remains, however, that regardless of how many of the defendants the Kentucky attorneys can actually surmise, the case is a massive joke. The lawsuit is based on an extremely old Kentucky law which states that in cases of illegal gambling, a third party – in this case the state of Kentucky – can sue on behalf of the loser to recover damages to the amount of triple that which was lost. Unfortunately for Kentucky, poker is not a game which is played against the house and money that is lost in a hand of poker is lost to another individual at the table and not, in this case, to Full Tilt Poker. The poker room is merely a way to provide an environment in which to play against other players and is not an active participant in the game.

The Franklin Circuit Court where the lawsuit was filed and the judge, Thomas Wingate, have already shown a bias by approving the seizure which was easily overturned in the Kentucky Court of Appeals. Despite the fact that the case is totally frivolous and has already been overturned, there is a possibility, however remote, that the case may gain traction. It is unlikely, however, that Judge Wingate would be excited to make another ruling that would most likely be overturned again with regard to internet gambling.
The news, however, that there is a possible grand jury investigation into Full Tilt Poker is a much more serious case. Of course, this is only potentially serious as nothing has been done officially which means that, at this time, everything is purely speculation. The Financial Times is the only major news source which has reported on the possible grand jury investigation which, despite being the only one to report on the story, is still a serious concern as The Financial Times is an internationally recognized news publication with a low and respected history. With that said, grand jury investigations are sealed and anyone releasing information about an ongoing grand jury investigation would be breaking the law. If we are to assume that the word of a grand jury investigation into Full Tilt Poker which was leaked to the Financial Times is true, there is no way to know for certain how far along the investigation might be. The grand jury investigation could be just starting or things could be wrapping up without any intention of going to trail. Grand Jury investigations are similar to pretrial hearings in that a jury hears evidence and sees witness testimony and are required to determine whether there is probable cause that a crime was committed and then indictments can be issued.

For poker players that are playing on Full Tilt Poker, the possibility of a federal grand jury investigation is something that should raise concerns but is not a signal that they should abandon ship. The grand jury would need to conclude and find probable cause before indictments could be issued and, even after indictments are issued, the onus is on the prosecutor in order to prove beyond a reasonable doubt that a crime was committed. With that said, the federal prosecutors in Manhattan federal court are some of the best in the world so it should not be entirely brushed aside. With all that said, it is far too early to tell if there is anything to worry about. The Kentucky case is nothing but a farce and there is only the possibility of a trial which does not even necessitate a strong case against Full Tilt. All in all, if you play on Full Tilt you can continue to play as usual and, if something does have the possibility to happen, you will certainly hear about it.

Posted by Joel on May 26 2010. Filed under Poker News. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry