The Insiders: Groupe Bernard Tapie Lawyer, Behnam Dayanim
Without a doubt, the top story of 2011 was Black Friday. Now, as the new year begins, the ramifications of that story continue to permeate the poker industry. There have been significant developments over the course of the past eight months, but perhaps none more meaningful than Groupe Bernard Tapie’s (GBT) interest in acquiring Full Tilt Poker. That time-consuming acquisition is still unfinished but seemingly certain, priming it to be one of the biggest stories of 2012.
As the poker world waits for the next development to break, PokerNews reached out to the man representing GBT’s interest in the United States, Behnam Dayanim, a lawyer based in the Washington, D.C., office of Axinn, Veltrop, Harkrider, LLP.
Dayanim, co-chair of AVH's Litigation and Regulatory Group, received his Bachelor of Arts degree, summa cum laude, in 1989 from Yeshiva University in New York, followed by his Juris Doctorate, cum laude, from Harvard Law School. He was previously a partner with Paul Hastings Janofsky & Walker LLP and has been recognized on the national level through Chambers USA and the Legal 500.
An experienced litigator, Dayanim's expertise is in gambling and gaming; export controls and sanctions; information technology licensing and outsourcing; privacy and data protection; electronic signatures and payments regulation; and advertising and marketing.
What’s the latest in the Groupe Bernard Tapie/Full Tilt Poker talks with the U.S. Department of Justice? Has there been any recent progress?
No, there’s nothing new.
The latest news in the Full Tilt Poker saga was that shareholders had approved a deal to transfer assets to Groupe Bernard Tapie. What will be the next step?
It’s a multistep process. I’ll start with the first step to get to the last step. The first step was negotiating with the Department of Justice, which was done back in November. That provided, upon consent by Full Tilt companies to forfeit their assets, that the DOJ would sell those assets to GBT. We concluded that in November.
The second step was obtaining the consent of Full Tilt companies to forfeiture into the proposed arrangement of the assets to us. [The shareholder’s approval] covers that piece.
The next step is negotiating and memorializing a definitive agreement with the DOJ that essentially sets out all of the details surrounding the terms to the letter agreement. That’s what we are doing now. Once that’s done, the final step would be the actual forfeiture, and the order of court that allows for the Department to subsequently sell the assets to us.
When can we expect to see that happen?
Well, I tend not to give timelines. Whenever I give timelines there are events that are not under our control, so I can’t tell you a definitive timeline to conclude this process. I would hope that we would get this done in the early part of the year.
In November, news broke that GBT would acquire FTP for $80 million. According to that deal, GBT would pay back players outside of the U.S., while the DOJ would repay players in the U.S. How would GBT go about facilitating payback to players outside of the U.S.? Do those details need to be ironed out still?
I think the GBT is in the process of making those decisions, evaluating what the mechanism will be, and working through those details. That’s part of the diligence the GBT is taking, and I think that plan will develop over the next several weeks.
Does GBT still plan to reapply for a license with the Alderney Gaming Commission? If so, how long would that process take?
Yes, the plan would be to seek a license from the Alderney Gaming Commission and also from the Kahnawake Gaming Commission (KGC). As you may know, Full Tilt has held licenses from both those regulatory authorities. Our expectation is that we will do the same.
I hope that the process would not take terribly long because Alderney is already familiar with the technology, the software, the gaming platform, and all of that, which is a large part of the process. The new component would be the people in the ownership and the management, so that will take a little bit of time of course, but we are optimistic it can be done quickly.
It’s been said that Full Tilt's existing owners may retain minority stakes, staying on as "passive" investors. Can you elaborate on what that means, who may exercise this option, and why they might want to do so?
The agreement with the DOJ contemplates that the GBT would retain majority and controlling interest in the company. The DOJ also prohibits Full Tilt members from retaining or acquiring any ownership interest in the new company, namely the directors are not permitted to have ownership interest going forward.
To the extent that any members decide they would like to participate in a minority stake in the company going forward, other than the ones who’ve been excluded, there would have to be negotiating and any interest would be entirely passive.
Laurent Tapie has stated that some players may be offered equity stakes in the new company as a form of repayment. Is this still the plan?
As I’ve said before, GBT is evaluating all of its options in terms of how it will go about compensating players. I’m not comfortable saying something will or will not be included because that process is ongoing.
What attracted you to the gambling and gaming areas of the law?
I came at this from a technology perspective. I started off as an export-trade lawyer specializing in high-technology issues. For example, I dealt with export of encryption software and things of that nature. Then, about 13 or 14 years ago, I started working with a payment processor company that had a variety of payments regulatory issues.
They also processed gaming and they asked me about pending gaming legislation. As you know, that issue was kicking around Congress for many years before the UIGEA passed in 2006. So at that time, a bill was pending that would have clarified the legal status of Internet gaming, and suddenly I started to work on their gaming issues [in the late 90s].
I was subsequently retained by what was then called Party Gaming to advise on gaming and related regulatory issues. So I’ve been involved for quite some time.