is it legal to wager money on games of skill online?

[geormiet]

Would it be illegal for a us company to operate a website that took wagers on a game such as chess, or starcraft?

If not, what about a tournament with an entry fee and a prize pool featuring chess or starcraft?

[PropPlayer]

To my knowledge it is legal. The backgammon sites have pushed that their business is legal because it is a game of skill. I’m no expert but my understanding is yes its legal.

[CasinoPimp]

Yes it's legal except for a couple of states. In fact some of the sites have a skill version of blackjack that's fun to play. Most of the skill game sites list in their t&c's the states that they can't allow players from.

[furyshade]

the bill states that games like poker are illegal partially because they have tournament with prize pools based on the sum of their entry fees, games like starcraft or chess usually have preset payouts, therein are legal

[Ron Burgundy]

"Skill" games for money are legal in most states. The problem is that the definition of "skill" is completely bogus. Solitaire is considered a game of skill, while poker is not.

Just go on msn.com and look at the games there. Some are for real money, and have nowhere near the skill element of poker.

[bachikarn]

So party gammon is legal? Aren't party poker and party gammon accounts linked? So couldn't want deposit money to play gammon then use some of it to play poker?

[geormiet]

Ok then...how hard would it be to convince the government that poker is a game of skill?

It was done in Cali already, no?

[erastank]

Not hard at all. I just made a post about this. In 1985 Billy Baxter argued and won in 2 courts that poker is a game of skill and that his tourney win should be taxed as earned income. I think that PS could make an argument since they only offer poker.

[TimTimSalabim]

[ QUOTE ]
Ok then...how hard would it be to convince the government that poker is a game of skill?

It was done in Cali already, no?

[/ QUOTE ]

That's true, in fact, there was a time in Cali when only draw poker was legal and stud variants (including holdem) were illegal because they were considered to be games of chance, until the card rooms were able to convince the government otherwise.

[Little_Luck]

Wait, if its just about the prize pool, that's pretty simple. Put up a set payout $100,000 tourney with a $110 fee and cap the entries at 1000?

[Mr.K]

Guys, this is an interesting discussion, but it is headed off in a grossly unrealistic direction. The letter of the law is clear -- poker is a covered activity (you won't find the word "poker" in there, just like you won't find "roulette," but both are covered by Sec. 5362(1)(A) et seq.

So trying to "convince the government" to "carve poker out" as a "game of skill" is not something that can or will happen. Sorry.

[checkmate36]

[ QUOTE ]
Guys, this is an interesting discussion, but it is headed off in a grossly unrealistic direction. The letter of the law is clear -- poker is a covered activity (you won't find the word "poker" in there, just like you won't find "roulette," but both are covered by Sec. 5362(1)(A) et seq.

So trying to "convince the government" to "carve poker out" as a "game of skill" is not something that can or will happen. Sorry.

[/ QUOTE ]

So does chess fall into the group of covered activities?

I see no difference between a chess tourney or a MTT. Both are games of skill, both pay the top player the largest prize. The USCF holds tournaments in high schools, how about a poker MTT after the chess is over with. /images/graemlins/grin.gif

[Mr.K]

Have you read the text of the bill? The section I cited targets games "subject to chance." Since chess is not subject to chance, and poker is, the two cannot be compared.

[OrianasDaad]

Chess is a game of, in theory, complete information. Luck is not part of any sort of winning strategy.

Here's an example: You put Kasparov, Kramnik, Topalov, and (just for kicks) Gelfand into a 5000+ open swiss. Unless there are other world-class players present, there is a very large likelyhood that these four will take spots in the top 10, if not the top 4 places themselves. If they didn't, it would likely be an upset.

Now, take the top four MTT poker pros and put them into a 5000+ field. They have to get "lucky" to make it to the final table.

As far as whether or not it's illegal now? I guess it was technically illegal before, so on that front there doesn't appear to be any difference.

[checkmate36]

Mr. K-

I didn't read the bill. Im just another online fish in the poker world. I did read your post on the bill and want to thank you for taking the time. I didn't mean to sound as if I was questioning your insights.

I know poker is a game of chance but I also see it as a game of investing. If I have a hand that is an 85% favorite to win at the showdown, Im going to try to get as much money involved as I can. When the 15% turns up Im glad I use proper bankroll management.

Thanks again for providing your insights so clowns like me have a better idea of whats going on. /images/graemlins/grin.gif

[Little_Luck]

I used to play competitive chess. Sometimes, even though your opponent was up several points end-game, there was a "Chance" he would make a move that would allow you to take the lead, even though all conventional wisdom said he should win (I would include "she", but I've never lost to a woman at chess).

Everything in life has chance and odds attached to it.

[LetsGetItOn]

Chess isn't a great example but what about Gin Rummy, sure skill prevails in that much more than luck (from what I know) but if one average player got absolutely perfect cards that gave him a knock for 100 points first round that's a big luck element and from my understanding gin rummy is completely legal to play for money online.

[Copernicus]

i believe this thread is way off base. no matter what they claim, no raked/fee/seat rental game online is legal according to the Feds.

there are arguments for any game being legal if you dont charge, but have revenue from ancillary businesses...eg click revenues, logo wear etc. some attorneys will tell you that even if no rake they arent legal.

[AlexM]

[ QUOTE ]
Have you read the text of the bill? The section I cited targets games "subject to chance." Since chess is not subject to chance, and poker is, the two cannot be compared.

[/ QUOTE ]

Of course it is. A rank novice can beat a grandmaster by making purely random moves. It's like a one in a trillion chance or worse, but it's definitely there.

[ShakeZula06]

[ QUOTE ]
Chess is a game of, in theory, complete information. Luck is not part of any sort of winning strategy.

Here's an example: You put Kasparov, Kramnik, Topalov, and (just for kicks) Gelfand into a 5000+ open swiss. Unless there are other world-class players present, there is a very large likelyhood that these four will take spots in the top 10, if not the top 4 places themselves. If they didn't, it would likely be an upset.

Now, take the top four MTT poker pros and put them into a 5000+ field. They have to get "lucky" to make it to the final table.

As far as whether or not it's illegal now? I guess it was technically illegal before, so on that front there doesn't appear to be any difference.

[/ QUOTE ]

Note the bolded part. That definitively makes it a game of chance.

[LetsGetItOn]

[ QUOTE ]
i believe this thread is way off base. no matter what they claim, no raked/fee/seat rental game online is legal according to the Feds.


[/ QUOTE ]

The "skill" game sites have a "rake" per game played also, sure it's not like a cash games rake where its from every single hand but if you made this argument sngs would be legal.

[Artsemis]

[ QUOTE ]
[ QUOTE ]
Have you read the text of the bill? The section I cited targets games "subject to chance." Since chess is not subject to chance, and poker is, the two cannot be compared.

[/ QUOTE ]

Of course it is. A rank novice can beat a grandmaster by making purely random moves. It's like a one in a trillion chance or worse, but it's definitely there.

[/ QUOTE ]

You don't understand what a game of chance is. A "chance" for something to happen doesn't make it a "game of chance". The game's outcome doesn't involve random events.

[Unicorns]

By those standards Magic Online is illegal right?

So we already got Microsoft and Hasbro breaking the law so far (unless of course they shut down before/when it's signed, which I don't really see happening)

[Copernicus]

[ QUOTE ]
[ QUOTE ]
i believe this thread is way off base. no matter what they claim, no raked/fee/seat rental game online is legal according to the Feds.


[/ QUOTE ]

note the word "fee", A sng entry is a fee.

The "skill" game sites have a "rake" per game played also, sure it's not like a cash games rake where its from every single hand but if you made this argument sngs would be legal.

[/ QUOTE ]

[ianlippert]

[ QUOTE ]
"Skill" games for money are legal in most states. The problem is that the definition of "skill" is completely bogus. Solitaire is considered a game of skill, while poker is not.

Just go on msn.com and look at the games there. Some are for real money, and have nowhere near the skill element of poker.

[/ QUOTE ]

Well I guess that online poker is illegal now we should all become professional Bespelled (http://cashgames.skilljam.com/splash/splash.asp?gme=31&cat=9999#) players. Whos with me? Mason when are you going open your Bespelled forum for us? lol, Bespellaments!

[ianlippert]

[ QUOTE ]
By those standards Magic Online is illegal right?


[/ QUOTE ]

It seems like its okay if your tourney prize pools are static. That was the worst thing about magic tourneys. 300 player grand prix 3K prize pool, 1000+ player grand prix 3K prize pool.

[Copernicus]

MSN cash games are considered sweepstakes, which are goverened by state law. From their TOS:

"The rules governing sweepstakes, contests and tournaments with entry fees and/or prizes are established by individual states, not the federal government. If you reside in any of the following states, you cannot participate in fee-based tournaments with prizes: Arizona, Arkansas, Delaware, Florida, Iowa, Louisiana, Maryland, South Carolina, Vermont, or any other jurisdiction in which participation in the games and tournaments offered on this Site is restricted by law. VOID WHERE PROHIBITED OR RESTRICTED BY LAW. "

Its been several years since I had a legal opinion prepared on sweepstakes laws by state, and things may have changed, but the common feature was that if there was an entry fee there had to be an alternative "free" way to enter. "Free" allowed nominal fees such as "shipping and handling". So my guess is that MSN gets around the gaming laws by charging minimal "administrative fees" that are considered no more than nuisance level.

The skill element probably has little or nothing to do with the legality..just the amount charged and some sort of "sweepstakes" distribution method.

[geormiet]

[ QUOTE ]
Guys, this is an interesting discussion, but it is headed off in a grossly unrealistic direction. The letter of the law is clear -- poker is a covered activity (you won't find the word "poker" in there, just like you won't find "roulette," but both are covered by Sec. 5362(1)(A) et seq.

So trying to "convince the government" to "carve poker out" as a "game of skill" is not something that can or will happen. Sorry.

[/ QUOTE ]


Is it really grossly unrealistic? To me it seems like it is possible to manipulate language to define poker as pretty much whatever you want it to be. After all, given time, poker is not a game of chance, and this can be proven empirically.

[Copernicus]

[ QUOTE ]
[ QUOTE ]
Guys, this is an interesting discussion, but it is headed off in a grossly unrealistic direction. The letter of the law is clear -- poker is a covered activity (you won't find the word "poker" in there, just like you won't find "roulette," but both are covered by Sec. 5362(1)(A) et seq.

So trying to "convince the government" to "carve poker out" as a "game of skill" is not something that can or will happen. Sorry.

[/ QUOTE ]


Is it really grossly unrealistic? To me it seems like it is possible to manipulate language to define poker as pretty much whatever you want it to be. After all, given time, poker is not a game of chance, and this can be proven empirically.

[/ QUOTE ]

but the law doesnt distinguish between games of chance and games of skill...both entail "bets or wagers".

[geormiet]

Ok. I guess I should read the law first then . /images/graemlins/smile.gif

[ShivasIrons]

I agree Mr. K that Congress is not going to be convinced at a later date to carve out poker. However that is beside the point. Litigation on this and other key points in the bill is where this will go, and where they hope for the future lies. Convince the courts, Congress has already spoken.

[geormiet]

Just a thought:

Tournament poker doesn't really involve bets or wagers. The chips in play aren't real money, and there is only an entry fee.

[MilkMan]

[ QUOTE ]
Just a thought:

Tournament poker doesn't really involve bets or wagers. The chips in play aren't real money, and there is only an entry fee.

[/ QUOTE ]

you're right, they ARE silly!! lol donkaments

[Mr.K]

[ QUOTE ]
[ QUOTE ]
Chess is a game of, in theory, complete information. Luck is not part of any sort of winning strategy.

Here's an example: You put Kasparov, Kramnik, Topalov, and (just for kicks) Gelfand into a 5000+ open swiss. Unless there are other world-class players present, there is a very large likelyhood that these four will take spots in the top 10, if not the top 4 places themselves. If they didn't, it would likely be an upset.

Now, take the top four MTT poker pros and put them into a 5000+ field. They have to get "lucky" to make it to the final table.

As far as whether or not it's illegal now? I guess it was technically illegal before, so on that front there doesn't appear to be any difference.

[/ QUOTE ]

Note the bolded part. That definitively makes it a game of chance.

[/ QUOTE ]

The wishful, off-base thinking in this thread is doing nobody any good. It is time you guys start accepting that this law is happenng, and you can't wish it out of existence or torture its language to mean something other than what it plainly says.

[Hock_]

[ QUOTE ]
poker is a covered activity (you won't find the word "poker" in there, just like you won't find "roulette," but both are covered by Sec. 5362(1)(A) et seq.

[/ QUOTE ]

This is NOT correct. Poker is only covered IF it is "unlawful internet gambling," and despite what the disingenuous Bush DOJ says, neither the Wire Act nor any other legislation with which I am familiar covers poker. There maybe state laws that prohibit poker, but nothing federal that I know of.

[ShakeZula06]

[ QUOTE ]
[ QUOTE ]
[ QUOTE ]
Chess is a game of, in theory, complete information. Luck is not part of any sort of winning strategy.

Here's an example: You put Kasparov, Kramnik, Topalov, and (just for kicks) Gelfand into a 5000+ open swiss. Unless there are other world-class players present, there is a very large likelyhood that these four will take spots in the top 10, if not the top 4 places themselves. If they didn't, it would likely be an upset.

Now, take the top four MTT poker pros and put them into a 5000+ field. They have to get "lucky" to make it to the final table.

As far as whether or not it's illegal now? I guess it was technically illegal before, so on that front there doesn't appear to be any difference.

[/ QUOTE ]

Note the bolded part. That definitively makes it a game of chance.

[/ QUOTE ]

The wishful, off-base thinking in this thread is doing nobody any good. It is time you guys start accepting that this law is happenng, and you can't wish it out of existence or torture its language to mean something other than what it plainly says.

[/ QUOTE ]
I'm fighting against this arbitrary thinking off what is a game of chance and what isn't. This has nothing to do with whether the bill is happening or not.

[schroedy]

[ QUOTE ]
there are arguments for any game being legal if you dont charge, but have revenue from ....

[/ QUOTE ]

Not to hijack this originally misguided thread even further off-course but, the best way to get around the don't charge criteria is to charge a monthly "club dues" sort of fee.

[Shank]

FWIW, as I (not a lawyer) understand it, the situation with skill games is more or less as follows:

1. The majority (around 40 or so - not sure of the exact number) of US states allow games of skill to be played for cash or prizes where a consideration of some sort (cash or otherwise) is paid for entry.

2. Generally speaking, in the remaining states there are various types of tests applied to determine whether the game is one of skill or chance. The most common test effectively says that to be a skill game, there can be *no* element of chance. Even if it's only 1% chance, that's usually too much.