For years now, there has been pending litigation between the Commonwealth of Kentucky and PokerStars. The state is seeking a superfluous 5-figure payout, said to amount to the money resident online poker players lost at the poker site between 2006-2011. The Poker Players Alliance (PPA) has stepped in, saying that if PokerStars is ordered to pay anything, that money should go to the players, not the Commonwealth.
Kentucky officials began their persecution of online gambling sites in 2008 by seizing the domains of 141 relative websites, including Pokerstars.com, accusing them all of illegally contributing to the proliferation of illegal gambling in a jurisdiction where such activates are proscribed.
Five years later, the Department of Justice (DOJ) rewarded the Commonwealth for its efforts to thwart illegal online gambling by delivering a check to the state for over $6 million, paid for by the events of Black Friday in 2011.
Then in 2013, with the case against multiple operators still pending, Bwin.Party (formerly Partygaming at the time of seizure in 2008) settled with the Commonwealth, forking over $15 million. PokerStars, however, never agreed to settle its case.
Kentucky happily accepted the $21 million it had already gained, but not a single dollar went to the online poker players they were vowing to protect. The PPA, which represents over a million live and online poker players in the US—more than 14,000 of which reside in Kentucky—wants to make sure that any future money awarded to the Commonwealth goes where it belongs; in the pockets the players who lost it, not the government officials seeking to reduce their budget deficits.
In a press release issued on Saturday, the PPA announced its motion to join Kentucky’s litigation against PokerStars, saying that the Commonwealth is “wrongly seeking to recover Kentucky consumer funds without consent or any intent to return such funds to such consumers.”
The PPA called the claim “an inequitable and unjustified windfall to the Commonwealth with a short-term view towards covering budgetary shortfalls”, pointing out that it fails to offer any real protections to the Kentucky residents – protections that would be much better provided by regulating online poker in the state.
“This is a cynical big government money grab of private consumer dollars to pay for political excesses,” John Pappas, Executive Director of the PPA. “This entire lawsuit is based on a long-shunned 19th Century sore loser statute [Kentucky Statutes 372.020; 372.040], which is about as applicable today as the anti-dueling laws still on the books.”
Pappas accused Kentucky of spending “countless resources and time figuring out how to extort money from online poker companies when they could have spent that time creating a safe and regulated market that would have raised equal or greater amounts of money to benefit the consumers and taxpayers of the Commonwealth both now and in the future.”
If the lawsuit does end in PokerStars being legally obligated to hand over any money, Pappas insisted, “The affected players should be the ones who collect from this suit, not the government and certainly not the attorneys.”