Re: a lot to talk about
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Nice post Res,
I am a 1L at Michigan law. I agree with your general thoughts, but also think that the ease of non-reporting of online gambling winnings makes it more likely than you think that the government will want to get a piece of the pie. I can easily envision a scheme in which you will have to register with an online company incorporated in a state with legal gambling, and one in which your transactions will be automatically reported to the tax authorities.
That being said, the weight of society surely seems to be behind online poker. This is a democracy, and the more widespread and accepted gambling becomes (by this I mean the more grandmas playing; keep the ridiculous amounts of money won/lost secret fellas), the less likely it will be outlawed. I sure am curious as to why vegas and AC lobbyists haven't tried preemtively to get legislation through; it seems like that boat has sailed though.
And with regard to your forum selection clause, you could always win on an unconsionability claim, attach their property in the U.S., and force them to ship their asses out here and defend in federal court. There's definately diversity jurisdiction there [img]/images/graemlins/grin.gif[/img]
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Oh yeah, Civ Pro baby! Your first year prob the most fun. Buy all the freaking study aids and outlines you can. Reading the cases in full is very over-rated w/ respect the exam grades in my experience.
1. I have no statistics on tax evasion problems arising from online gaming. I don't even have a ballpark figure. However, if you're making a lot of money as a internet poker pro, then the money has to go into your bank account before you can spend it. The IRS will see that you have no official income producing job (w-2) and wonder how you make large purchases. Here, I refer to things like homes and whatnot. They will get curious and audit you. I know this because my friend is an artist from a wealthy family in Asia. He has sold very little of his work, yet lives in a $1 million+ apt. in manhattan. His parents wire money into his account monthly. He's been audited twice. Plus, I think there are some bank reporting requirements involving transactions over a certain amount. I'm no expert here, but maybe someone could chime in. I cannot evision your scheme as easily because it would be very difficult to enforce. Why would a gaming site register when they don't have to? If they don't will US players stop playing on their site? Unlikely. Then we're back to the whole ex post punishment of players, or some sort of technological solution which would in all likelihood be some horrilble botchery rather than a solution. Plus, it would be easier scheme to require banks to report income from certain companies (there really aren't that many gaming sites, less than 500 I think).
2. What's an AC lobbyist? Anyway, I think federal legislation legalizing internet gaming is win-win for the US. Players get legal protection from US based sites and the US gets the tax revenue from them. Whether or not this will cause the sites to re-incorporate in the US is a different question, but I think that sites that do should have some competitive advantage in that their players are secure in knowing they are protected by US laws.
3. One of the neater things I learned in law school was that the abbreviation for contracts is "K". There are simply to many legal terms involving "C" already. Oh god, diversity jxn and contracts, I'm gonna have to consult my outline. OK, done. DJ requires the amount in controversy be over $50k. This is quite a crappy hurdle to overcome. Second, unconscionability claims are, from what I learned, very difficult to win on. The only case I remember is involved the old biddy who spent her life savings ($65k) signing up for dance lessons because the dance school convinced her she could be a professional. The court agreed with her and forced the school to return the money. I think the court should have ruled under the doctrine of "you can't form enforceable contracts with drunk or retarded people" (I've forgotten the legal term) because for some 65 year old woman to think she was gonna turn pro is retarded. Also, I think the gaming sites have minimal assets in the US. I have no firsthand knowledge here, but as a former data center engineer, I'm positive they don't need any technology assets located in the US. As for whatever financial assets/institutions they have in the US, I suspect those are minimal as well. When I asked UB to cut me check, they sent one from Bank of America. I guess that account could have a decent amount of coin in it, but if they deposit on a per request basis, it shouldn't be too large.
Oh, and U of M? Nice school. My hot friend went there and did the BigLaw thing for a few years and now works as a childrens advocate for a non-profit. Oh the debt is fun... good thing you have your poker skills to help you pay it off (if posting here means you are a winning high stakes player). My winrate at the .10/.25 games is around minimum wage. The crappy federal one, not the generous CA one.
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