Are Poker Contests going to be popular in the US ? Recent Court ruling
 

According to a thread in Poker Legislation, in a recent Federal lawsuit involving AOL skill games and other games, "the plaintiff, Charles Humphrey Jr. of Colorado, claimed that the player registration fees, ranging from $9.95 to $499.95 per team, were essentially wagers or bets and sought to recover those amounts as gambling losses under the qui tam laws of states whose laws were supposedly violated.

Judge Cavanaugh found that where entry fees are unconditional and prizes are guaranteed, reasonable entry fees charged by the sponsor of a contest are not wagers or bets. He observed that spelling bees, track meets and beauty pageants would constitute gambling if all it took was the combination of an entry fee and a prize. "

We saw this post today and added some 10 player Poker Contests to our TruePoker games. They pay out a guaranteed $100 and $30 respectively and have a reasonable fee for entry and not surprisingly, run as soon as 10 players enter.

Before we develop a US marketing campaign for Poker Contests, we wamt to test the market. Please feel free to give me your feedback at management@truepoker.com.

Re: Are Poker Contests going to be popular in the US ? Recent Court ru
 

lol donktests

Re: Are Poker Contests going to be popular in the US ? Recent Court ru
 

Thanks for the bump, I guess.

Re: Are Poker Contests going to be popular in the US ? Recent Court ru
 

TPCEO - I think this could be a significant ruling because obviously there are other games out there that charge entry-fees that aren't considered gambling at all for some reason while poker gets the shaft.

Even in the U.S. for a live-tourney it has to take place in a casino even when you're just betting with tourney-chips/fake-money after you've paid your entry-fee.

I suspect that for a Bridge or Gin tourney with an entry-fee there isn't such a restriction that it can only take place in a casino.

I used to like to play in live chess tournaments that could sometimes charge high-ish entry-fees and these can be held pretty much anywhere.

So this aspect of being able to play other games online for money while supposedly poker, especially poker-tournaments, is somehow considered tabboo has always kind of confused me.


I do have a Q though.
I don't understand what you're talking about wrt your new 'poker contests'.
Are these just SNG's that you are giving a different title somehow?
How are these things different than SNG's?

I'm giving you a chance to spam away in here on whatever it is you're trying to do here because I'm kind of curious and don't understand.

Re: Are Poker Contests going to be popular in the US ? Recent Court ru
 

So it is a SNG right?

Re: Are Poker Contests going to be popular in the US ? Recent Court ru
 

[ QUOTE ]
Are these just SNG's that you are giving a different title somehow?

[/ QUOTE ]
i think so

[ QUOTE ]
How are these things different than SNG's

[/ QUOTE ]

name, i think.

Re: Are Poker Contests going to be popular in the US ? Recent Court ru
 

btw (i meant to include this in my last post) a very similar comparison can be made to games of Magic: The Gathering (and other customizable card games) which have entry fees, include card games, and involve significant cash prizes.

Re: Are Poker Contests going to be popular in the US ? Recent Court ru
 

i like what u r saying tpceo

Re: Are Poker Contests going to be popular in the US ? Recent Court ru
 

[ QUOTE ]
Are these just SNG's that you are giving a different title somehow? How are these things different than SNG's?

[/ QUOTE ]
I am curious about this as well TPC.

Re: Are Poker Contests going to be popular in the US ? Recent Court ru
 

I don't know, I just like this guy, downloading and depositing..

Re: Are Poker Contests going to be popular in the US ? Recent Court ru
 

Interesting thought regarding this issue. If a SNG is labled a skill game/contest and not gambling, then the amounts you win would still be taxed as income, but you can't then deduct your losses unless you are a professional. This was what Humphrey was trying to do in the case above and the judge disallowed them. Eh, just a thought.

Re: Are Poker Contests going to be popular in the US ? Recent Court ru
 

Obviously this court ruling creates even more debate over where the line currently is on this stuff. But I'm not sure it takes it to the point where a raked sng by any other name smells sweeter to people trying to stop online gaming.
Isn't a sticking point that the house will take a percentage of the prize pool, thus fees > prizes negating some of the "reasonable fee" argument?

Edit: I really need to go read the ruling, because if the only requirements are unconditional fee + guaranteed prizes, then I'm not sure rake negates any "reasonableness" arguments.

Re: Are Poker Contests going to be popular in the US ? Recent Court ru
 

Hmmm.....

While this is certainly interesting, I don't think we have to resort to this just yet.

But if the ability to transfer $$$ ever gets stopped, I think it's a very legitimate stance.

Maybe it would be in TruePoker's best interest to jump on the angle now. If word were to get out that TruePoker is now offering legal online poker contests that have been approved by a U.S. court, perhaps they could secure a certain sector of the market. They might even be able to set up payment processors here in the United States. That would certainly be a positive move for everyone.

I hope the SNG structures have changed since I last played there though. Starting with such shallow stacks (800 chips) wasn't very good.

Is a Poker Contest the same thing as a Sit&Go ? Not necessarily.
 

"Are these just SNG's that you are giving a different title somehow?"

If a Court wants the event to be called a "Contest", then it will be called a Contest. Actually, we posted our Poker Contests with the rules we did because it was easy to do so with existing software in about 10 minutes time.

To my understanding, the sole defining element of a SitnGo is that it commences when X players are registered. The Poker Contests we posted share that feature, but it is NOT an essential element of a Poker Contest.

There is nothing to gain by labeling Poker Contests as SitNGoes. The current version we offer yields the winners the same prize structure, for the same financial contribution, and the "start" of the tourney is determined by it filling up. The similarity of those charateristics to a traditional S&G do not define a "Poker Contest" however.

There is no reason why a Poker Contest "must" look only like a S&G. In fact there are numerous varieties that occurred to us, but would require additional time to post.However, the "start" time feature is not an essential element. A multi-table guaranteed structure, running at a set hour could also qualify as a Poker Contest. We just didn't do an MTT on the fly.

If this seems acceptable to the market, we will post other versions, which are not tied to the S&G "start when full" model.

(I wanted to post something for public play which meets the apparent parameters of a Poker Contest as soon as possible, to be able prompt the discussion, but also claim a "first use" for legal reasons .... in case some later company tried to claim a patent.)

Re: Are Poker Contests going to be popular in the US ? Recent Court ru
 

I don't know if Chuck was shooting for a tax angle. More likely, he was testing the limits of "skill games" in the US and trying to get them defined. To that extent, he has apparently succeeded in getting some elements defined in a manner favorable to poker.

We owe him thanks for the effort.

Re: Are Poker Contests going to be popular in the US ? Recent Court ru
 

"But I'm not sure it takes it to the point where a raked sng by any other name smells sweeter to people trying to stop online gaming."

I am pretty sure that to people trying to stop online gaming, ALL gaming smells .... whether online or in a casino, or at your house, or at a racetrack.

I really need to read the decision also, but thought the discussion could proceed regardless.

Re: Is a Poker Contest the same thing as a Sit&Go ? Not necessarily.
 

[ QUOTE ]
(I wanted to post something for public play which meets the apparent parameters of a Poker Contest as soon as possible, to be able prompt the discussion, but also claim a "first use" for legal reasons .... in case some later company tried to claim a patent.)

[/ QUOTE ]

1. Can something like this really be patented?
2. Is TruePoker likely to claim a patent?

Re: Is a Poker Contest the same thing as a Sit&Go ? Not necessarily.
 

1. I have seen patents claimed for casino games before.
2. Our software company is looking at developing the Poker Contests market for US play. A game with no betting or wagering has certain attributes that make it easier to offer than a straight up poker game. We certainly want to be able to defend our right to offer Poker Contests against anyone else.

Re: Is a Poker Contest the same thing as a Sit&Go ? Not necessarily.
 

Of course I love what you are doing here TPCEO, but before we get too happy, can we please see the opinion?

I am very confident that the opinion discusses the "skill" aspect of the contest. A lottery can be called a contest too, but that wont change its legal standing.

Legally, in MOST states, contests of "skill" are not gambling. A poker contest is not gambling if poker is a game of skill, a poker contest is gambling if poker is a game of chance.

And most states determine whether a game is one of chance or skill by asking which is the greater factor in determining the outcome.

I have previously posted a formal legal argument to show poker is a game mostly determined by skill. Few, even here at 2+2, took the argument seriously (TPCEO, to his credit, actually provided us with some numbers from his site to back up the argument). I hope maybe now people will see the importance of separating poker from "gambling" by emphasizing that its results are MOSTLY (of course not always) due to the skills exhibited by the players through their actions, not the cards.

If you cant do that, this case means nothing.

Skallagrim

Re: Is a Poker Contest the same thing as a Sit&Go ? Not necessarily.
 

Anybody want to have a keno contest?

How about a roulette contest?

Re: Is a Poker Contest the same thing as a Sit&Go ? Not necessarily.
 

Thanks for the explanation TPC. I wish you luck with it. Could be a big win for all of us.

Re: Are Poker Contests going to be popular in the US ? Recent Court ru
 

Can someone post a link to the case? I'd like to read it.

Re: Is a Poker Contest the same thing as a Sit&Go ? Not necessarily.
 

[ QUOTE ]


To my understanding, the sole defining element of a SitnGo is that it commences when X players are registered. The Poker Contests we posted share that feature, but it is NOT an essential element of a Poker Contest.

There is nothing to gain by labeling Poker Contests as SitNGoes. The current version we offer yields the winners the same prize structure, for the same financial contribution, and the "start" of the tourney is determined by it filling up. The similarity of those charateristics to a traditional S&G do not define a "Poker Contest" however.

[/ QUOTE ]


I guess I must be pretty dumb because I've read this 4 times and still don't understand what it means.

Can someone explain to me a bit more simply what exactly these 'poker contests' are?
I really don't understand what they are trying to do here.

Re: Is a Poker Contest the same thing as a Sit&Go ? Not necessarily.
 

[ QUOTE ]
[ QUOTE ]


To my understanding, the sole defining element of a SitnGo is that it commences when X players are registered. The Poker Contests we posted share that feature, but it is NOT an essential element of a Poker Contest.

There is nothing to gain by labeling Poker Contests as SitNGoes. The current version we offer yields the winners the same prize structure, for the same financial contribution, and the "start" of the tourney is determined by it filling up. The similarity of those charateristics to a traditional S&G do not define a "Poker Contest" however.

[/ QUOTE ]


I guess I must be pretty dumb because I've read this 4 times and still don't understand what it means.

Can someone explain to me a bit more simply what exactly these 'poker contests' are?
I really don't understand what they are trying to do here.

[/ QUOTE ]

A SNG is a poker contest. But a poker contest is not necessarily a SNG.

Re: Is a Poker Contest the same thing as a Sit&Go ? Not necessarily.
 

[ QUOTE ]
Can someone explain to me a bit more simply what exactly these 'poker contests' are?
I really don't understand what they are trying to do here.

[/ QUOTE ]

A "legal" way to play a game with cards and an entry fee.

Re: Is a Poker Contest the same thing as a Sit&Go ? Not necessarily.
 

[ QUOTE ]

Can someone explain to me a bit more simply what exactly these 'poker contests' are?
I really don't understand what they are trying to do here.

[/ QUOTE ]

Bob- It's the same structure of event under a new name, I guess attempting to take advantage of a ruling that has said that you can have "contests" that aren't necessarily gambling even though money is at stake.
The two cited elements of "contests" appear to be an unconditional fee, and a guaranteed prize payout- both of which sit and gos currently satisfy.
There are other considerations- such as what appears to be an element of reasonableness of the fee, but not having read the opinion yet I really don't know how that comes into play.

What tpc I think is doing- and i applaud the effort, is saying "okay, we will use your language then" and renaming them poker contests of skill.

All of this of course is moot if the determining factor of online poker's fate is whether or not people will accept it is ultimately a game of skill.
I still don't understand how a reasonable person can argue otherwise to be honest, but that has been my complaint against the chimps passing legislation all along- that they simply choose to ignore all evidence/arguments that show that.

I'm pretty sure my "sng by any other name" is a valid statement, but taking the sng label off and using a label that may seem to fit a new ruling handed down by a US court seems logical.

Give us an inch and we'll create the mile maybe.

Note- it seems that mtts that have guaranteed prizes and are actually scheduled events could have this same label under this theory.
Cap entries at X players, guarantee the prize amounts no matter how many enter, and this is no different than a regularly scheduled mtt, but could be called a "Multi Table Poker Contest of Skill"

Re: Are Poker Contests going to be popular in the US ? Recent Court ru
 

Its simple.

Poker has, on a number of occasions, been defined by courts as a game of skill. And in fact, it is a game of skill. We know this because you could deliberately lose. You cannot deliberately lose a a game of chance, like the lotto or flipping coins.

This recent case apparently holds that games of skill can charge entry fees and award unconditional prizes, and not be deemed gambling.

All True is pointing out is that there is a particularly popular format of poker that is very, very easily adaptable to these "contest" requirements --the SNGs, and MTTs for that matter. Everyone pays an "entry fee", and "unconditional" sum certain prizes are paid.

Now the lawyer in me tells me that this is a great argument.
But because poker is the current administrations's witch, I suspect that the witch will get burned. Again.

Re: Are Poker Contests going to be popular in the US ? Recent Court ru
 

It appears that this is what TruePoker CEO is talking about, though it doesn't involve AOL.

Re: Is a Poker Contest the same thing as a Sit&Go ? Not necessarily.
 

[ QUOTE ]
1. I have seen patents claimed for casino games before.
2. Our software company is looking at developing the Poker Contests market for US play. A game with no betting or wagering has certain attributes that make it easier to offer than a straight up poker game. We certainly want to be able to defend our right to offer Poker Contests against anyone else.

[/ QUOTE ]


Doesn't Dutch Boyd claim to have filed for a US patent on online poker tournaments when he ran his poker site in the late 90s? Pretty sure I've read this before..

Re: Are Poker Contests going to be popular in the US ? Recent Court ru
 

Thanks for the link Self Made!!!! (well the link to the link).

THIS IS ABSOLUTELY AMAZING FOLKS!!!!!

If you read this judges opinion, he basically says that he does not have to decide if fantasy sports leagues are skill or chance contests because:

Entry fees to contests are not "bets or wagers" (and I quote from the opinion) "because (1) the entry fees are paid unconditionally; (2) the prizes offered to fantasy sports contestants are for amounts certain and are guaranteed to be awarded; and (3) Defendants [the companies that ran the leagues] do not compete for the prizes.

There is absolutely no doubt that a "Poker Contest" could be organized along these lines. GO for it TruePokerCEO! At least in this Judge's jurisdiction organizing a "poker Contest" is definitely not gambling provided the 3 rules above are met because no bet or wager has occurred!!!!!!!!
(Did I use enough exclamation points?)

In fact, according to this judge, as long as you meet the no bet or wager criteria, you could have blackjack contests, craps contests, slot contests....

Not to be cynical, but I wonder if this judge would have ruled the same had it been a poker or blackjack contest? Judges would never tailor their decisions based on who the defendants were would they?

Skallagrim

Re: Are Poker Contests going to be popular in the US ? Recent Court ru
 

There are some big wows in the wording indeed. There are also some sections where my enthusiasm is tempered a bit but I think I should point out that the section Skallagrim quotes starts with...

As a matter of law the entry fees for Defendants' fantasy sports leagues are not "bets" or "wagers" because...

I think it's important to add those first five words for emphasis.

Re: Are Poker Contests going to be popular in the US ? Recent Court ru
 

[ QUOTE ]
In fact, according to this judge, as long as you meet the no bet or wager criteria, you could have blackjack contests, craps contests, slot contests....

[/ QUOTE ]

According to condition #3, as long as you are not playing these games against the house, I think they fit.

Re: Are Poker Contests going to be popular in the US ? Recent Court ru
 

[ QUOTE ]
I don't know, I just like this guy, downloading and depositing..

[/ QUOTE ]

David (TruePoker CEO) has always been a very likable guy. TruePoker was my favorite site for several months. My only complaint with TruePoker was when they sent me the TruePoker condoms. I ordered extra large and they sent mediums (darned things were still too big - I think they were horse condoms).

Thank you,

Jim Kuhn
Catfish4u
[img]/images/graemlins/spade.gif[/img] [img]/images/graemlins/diamond.gif[/img] [img]/images/graemlins/club.gif[/img] [img]/images/graemlins/heart.gif[/img]

Re: Are Poker Contests going to be popular in the US ? Recent Court ru
 

Not only does TruePokerCEO's SnG contest meet this judges criteria, but so would any MTT with a "guaranteed prize pool." The guarantee would have to be absolute, however, so the prize could not decrease if there are not enough players, nor increase if there are too many. Thats easy enough for a "contest sponser" to comply with (nothing stops cancelling the contest and returning the money if not enough players show up for example).

A small change and tournament poker is legal, pretty much everywhere (there are some few states with silly laws covering contests of any kind). Assuming of course, other judges rule the same way.

Skallagrim

Re: Are Poker Contests going to be popular in the US ? Recent Court ru
 

donkaments suck! i want ring contests!

Re: Are Poker Contests going to be popular in the US ? Recent Court ru
 

[ QUOTE ]
btw (i meant to include this in my last post) a very similar comparison can be made to games of Magic: The Gathering (and other customizable card games) which have entry fees, include card games, and involve significant cash prizes.

[/ QUOTE ]

and have a very relevant combination of luck + skill.

Re: Are Poker Contests going to be popular in the US ? Recent Court ru
 

I like what you have done here

Re: Are Poker Contests going to be popular in the US ? Recent Court ruling
 

I'd like to chime in hear in regards to the application of "conditional/unconditional" entry fees.

The entry fees for a spelling bee, a chess tournament, a beauty pageant are unconditional because the event begins at a scheduled time regardless of the number of entrants. The event operator does well by doing what is needed to get a sufficient number of entrants to achieve success. The final measuring stick has to do with whether or not the operator "could" lose money (due to a significantly sized guaranteed prize). If he can lose money then the entry fees are "unconditional". If he cannot lose money then the fees are "conditional".

Any SNG that cannot begin until 10 players are present implies that the entry fees are "conditional" (i.e. upon a full table of 10 players). The wording used to describe the "contest" simply does not matter; the underlying mechanics are the bottom line here.

For TruePoker to claim "unconditional" entry fees they would need to post a tournament announcement with the following features:

a) entry fees determined in advance
b) rake determined in advance
c) no set minimum number of players
d) guaranteed minimum prize amount
e) absolute start time regardless
f) set maximum number of players (optional)

Such conditions make it possible for me to be the lone entrant and win the prize by default; this is not likely but possible nevertheless.

If TruePoker wants to attempt to attract many players by posting a $1k prize for a $10 event at noon on Sunday then they can do so but if ony 3 people show up to play then they are still on the hook to begin at noon and deliver the game to those 3 and pay the $1k prize pool out in full.

bottom line: the conditional/unconditional issue hinges on whether or not the operator can lose money.

edit: this entire line of thought also applies to whether or not the prize is "guaranteed"

RIIT

Re: Are Poker Contests going to be popular in the US ? Recent Court ru
 

If you read the whole opinion, RIIT, you will see that the fantasy sports leagues also required a minimum number of participants before the games went forward and the prizes were guaranteed.

In other words, I dont think this judge was using the term "unconditional" in the same sense you are using it. Legal definitions frequently are not the same as common definitions.

What was meant here, IMHO, was that the entry fee guaranteed participation in the contest on an equal footing as all the other participants. The fee to play in the sports leagues was not conditioned on any other fee or status.

I see nothing illegal about a spelling bee that will commence on 1/1/08 as soon as at least 10 people show up to participate. I also nothing illegal about the sponsor of that bee canceling the contest and returning the funds if not enough people show up.

In other words, the contest is conditional, but the entry fee is not, it guarantees the right to participate in the contest if it is held. If you paid a fee and were told that only 10% chosen randomly got to play or that you paid the fee but also had to get 3 letters of reference, that would be conditional, IMHO.

As to prize amounts, the right to cancel the contest protects the sponsors. The real danger is a windfall for the sponsor by MORE people applying. More honest sponsors would therefore also have a maximum number of players.

Again, this is just one judge's opinion, but since it was clear in the facts that if there were not "a full compliment of teams" in the fantasy leagues, the contest would not take place, I have to conclude conditional meant something other than a guarantee the contest would take place no matter what - what if the spelling bee judges forgot to show up with the questions/words - would the sponsor be forced to go forward anyway? What if the company sponsoring the chess tournament lost all its chess sets in an accident?

Also, with SnG contests, even if I am wrong and there is one left over table with fewer than 10, thats hardly a big financial risk for the site operator.

Skallagrim

Re: Are Poker Contests going to be popular in the US ? Recent Court ru
 

[ QUOTE ]
The entry fees for a spelling bee, a chess tournament, a beauty pageant are unconditional because the event begins at a scheduled time regardless of the number of entrants.

[/ QUOTE ]

If I'm not mistaken, the National Spelling Bee takes x number of contestants from each state, and it doesn't start until it has y number of contestants.

Your language here just doesn't make much sense.

One table poker contests most definitely have a starting time: they usually start one minute after ten contestants have signed up.

And as far as I know, the recent judgement doesn't say any of this.