Kentucky Appellate Court Rules Against Online Gambling Domain Seizures

A three-judge Kentucky Court of Appeals on Tuesday reversed a lower-court decision that allowed the Commonwealth of Kentucky to attempt to seize 141 internet domain names connected to online gambling. The 2-1 decision by the appellate court strikes down the attempt by Kentucky Governor Steve Beshear to seize the domains in an attempt to protect the state's signature industry, horseracing, in a case that had drawn widespread interest not only in online-gambling circles but with internet freedom, commerce, and civil-rights concerns as well.

The 141 domain names, whose seizure is likely to be voided pending a possible appeal by Kentucky officials, include many prominent poker sites such as PokerStars, Full Tilt and others. While those two domains are housed in other countries and were unlikely to be surrendered in a jurisdictional dispute, dozens of other sites listed in the Kentucky seizure action were registered via US domain services and were at greater risk. The appellate decree declared that the domain names were not "gambling devices" as required by the outdated Kentucky law used for the seizure attempt.

In her opinion detailing the court's decision, Appeals Judge Michelle Keller wrote, "Regardless of our view as to the advisability of regulating or criminalizing Internet gambling sites, the General Assembly has not seen fit to amend (Kentucky law) as to bring domain names within the definition of gambling devices." Keller was joined by Judge Jeff Taylor in striking down the seizure issued by a Kentucky Circuit Judge in September 2008. Judge Michael Caperton cast a dissenting vote.

Said Poker Players Alliance Executive Director John Pappas on the ruling, "This is a tremendous victory for Internet freedom and the rights of Kentucky residents who enjoy playing online poker. We are pleased that the appeals court has forcefully reversed Judge (Thomas) Wingate's earlier ruling and confirmed many of the arguments that have been raised in opposition to the seizure effort. The Court of Appeals has agreed with the PPA's position and that Judge Wingate did not have the jurisdiction to issue the order that he entered against these domains and that (Kentucky) Secretary (J. Michael) Brown has no legitimate right to deprive the citizens of Kentucky of the legal right to play poker online." The PPA, as with several other interested organizations, was denied official legal standing during Judge Wingate's earlier hearings on the matter and was instead relegated to "friend of the court" status.

Both sides had previously promised to continue the battle regardless of the appellate court's decision, meaning that an appeal to Kentucky's Supreme Court is likely.