Kentucky Attorneys File Motion to Amend Internet Gambling Complaint

In a rather bizarre twist in the Kentucky internet gambling case, Commonwealth attorneys filed a motion on Wednesday to add parties to its case and amend its original complaint. In late October, the Kentucky Supreme Court heard the case.

Now, a hearing is scheduled for January 20th in Frankfort, Kentucky in front of Judge Thomas Wingate, the Circuit Court magistrate who heard the matter originally in late 2008. The case was brought last year against the owners of 141 internet gambling domain names on the grounds that the URLs constituted “gambling devices,” a term typically reserved for tangible items like slot machines, roulette wheels, and dice that you’d find in an underground casino. The Kentucky Supreme Court has not yet issued a ruling in the case.

After reiterating its complaint against the domain name owners, Kentucky’s attorneys explained, “In the course of the litigation and the Commonwealth’s continuing investigation, the Commonwealth has learned the identity of certain entities and individuals involved in internet gambling operations, some of whom are U.S. citizens.” Who this refers to is not yet known, as the Commonwealth has not yet released the names of companies or people to the general public or to counsel for the Interactive Media Entertainment and Gaming Association (iMEGA). Also unknown is whether the new targets are Kentucky residents.

The motion also hinted that further litigation could develop down the road: “The Commonwealth contemplates that further amendments will be sought as its investigation and discovery in this litigation continue.” Kentucky Justice and Public Safety Cabinet Secretary J. Michael Brown heads the case against the domain names in question, which were seized in September of 2008 allegedly without due process. Wingate ruled in favor of the Commonwealth’s actions, prompting iMEGA and several other parties to seek the intervention of the Kentucky Court of Appeals.

In January, the Kentucky Court of Appeals ruled by a two to one margin that the domain names did not constitute gambling devices and, therefore, the Commonwealth did not have jurisdiction to act. The lone dissenting judge noted that domain names were part of a larger gambling device. It remains to be seen what will occur during the January 20th hearing, which is slated for 9:00am ET. Eric Lycan of Hurt, Crosbie, and May in Lexington, Kentucky sign Wednesday’s letter.

Others involved with the fight for internet gambling in Kentucky besides iMEGA include the Interactive Gaming Council (IGC), Poker Players Alliance (PPA), American Civil Liberties Union (ACLU), the Center for Democracy and Technology, the Electronic Frontier Foundation, the Internet Commerce Association, eBay, and Network Solutions. Original estimates pinned a Kentucky Supreme Court decision within three to six months of the October hearing, although the latest motion filed by Commonwealth attorneys may affect that timeline.

In November, Churchill Downs Incorporated, the parent company of the racetrack of the same name in Louisville, Kentucky, purchased the online horse racing wagering site YouBet.com. A market analyst told Reuters at the time, “Given the combination of Youbet’s ADW platform with Churchill Downs-owned TwinSpires, which has been the fastest growing ADW this year, they will have 50 percent of the U.S. market and the best brand in horse racing.” Churchill Downs Incorporated owns TwinSpires.com; the site was not among the 141 internet gambling domain names targeted by Commonwealth attorneys.

YouBet.com is traded on the NASDAQ Stock Exchange under the symbol “UBET,” while Churchill Downs Incorporated can be found on the same exchange under the symbol “CHDN.”

Stay tuned to Poker News Daily for the latest developments in the Kentucky internet gambling case.

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