Kaplan Pleadings in BetOnSports

[Skallagrim]

"I realize there is a difference between radio broadcasting and internet broadcasting, because one is "push" without a way of knowing who receives, and the other is "pull" where there is a way via IP checking. But again it would seem to me that this mostly free speech argument doesn't help us and that the most relevant legal arguments re either domestic or international law will revolve primarily around commerce, and electronic commerce in particular."

Yeah, the issue with the Chinese is free speech, but the Chinese Government seems very determined NOT to allow their citizens free speech, and they have signed no international treaty requiring them to do otherwise.

So with respect to the internet, I still see the issues as the same: China should not be allowed to make CNN.com a criminal site for allowing Chinese to view it (thus subjecting the CNN owners/operators to arrest if they set foot in China) and the US should not be allowed to make Pokerstars a criminal site for allowing US players to play there (thus subjecting...).

If the US wants me to stop playing online poker, make it a crime for me to do so, don't make criminals out of Pokerstars for letting me play (legally according to their jurisdiction's laws).

The reason they wrote the UIGEA the way they did was to do precisely that, however, and it was because they knew the backlash from millions of sudden criminals would have overwhelmed anything the politicians get from FoF and their ilk.

Skallagrim

[oldbookguy]

Well put my friend.
I posted a shorter, but basically the same, message at the didds link in a story about Rove this morning at the Washington Post.

obg

[permafrost]

[ QUOTE ]
If the US wants me to stop playing online poker, make it a crime for me to do so, don't make criminals out of Pokerstars for letting me play (legally according to their jurisdiction's laws).

The reason they wrote the UIGEA the way they did was to do precisely that

[/ QUOTE ]

If Pokerstars is only involved in lawful internet gambling, how does UIGEA make them criminal?

[Legislurker]

Thats sort of the thing I want to hear a judge say Skall. I want one to sit there and tell the little loyal bushie wiht a boxtop law degree, "you can't use terrorism and extortion to make something illegal that isn't, and I am striking down this law and telling you you need to make something a crime by the user here and prosecute them, not lawful companies domiciled elsewhere." I hope the ruling comes before full WTO resolution, if the US keeps on the self-destructive path. Any idea on a timeline for this? Is there even a formal trial date set?

[MiltonFriedman]

It will likely be decided by the District Court in Missouri long before the iMEGA substantive motions are addressed in New Jersey ..... fortunately.

[Skallagrim]

The issue of where an internet "crime" takes place is one that so far has gone against us - my sympathies to Jay Cohen. But then Jay didnt have the WTO treaty argument, and that has the potential to make a big difference.

Actually, my prediction here is very pessimistic for the short run, but for the WTO: the increasingly totalitarian DOJ wants jurisdiction over the internet in a bad way. These gambling cases are the first to really raise the issue in a context other than "speech." The DOJ "loyal bushies" really have no care about the long term implications of their position. One can hope a judge would see it another way, but Jay Cohen's judge didnt.

The idea that every internet site needs to know the law of the jurisdiction in which every visitor comes from so that it can make sure it doesnt do something with that person that is legal where the site is, but illegal where the person is, is what the DOJ wants - it first tried this argument in porn cases (and lost), but those can be distinguished because of 1st amendment concerns, concerns not applicable to gambling or any other type of commerce.

This will severely limit internet freedom if it succeeds: no major site or company wants to be indictable in the US. Little sites and companies with no US contacts will ignore the US threats, at least until the US bullies their home countries into extradition. So most of the internet becomes as bland as broadcast television and Wal-mart.

The Europeans, bless their soul, will oppose this in general, but not until a country like China or Iran uses this doctrine against Americans will (most) Americans care or the DOJ see the error of their ways.

Someday an international treaty will have to address this issue. Until then we can hope, but not count on, courts seeing the madness of the DOJ position.

Skallagrim

[JPFisher55]

Skall, I don't know if you have read the briefs, filings and rulings of the Jay Cohen case. They are still linked at www.freejaycohen.com.
Jay's best defense IMO was based on a safe harbor provision in the Wire Act. Case law, contract and tax, from various state and federal jurisdictions, held that where a party accepting a bet receives the money for the bet is the location in which the bet originates and is accepted. The judges in Jay's case ignored these cases because they were not criminal cases and ruled that the bet originated in NY from where the bettor sent his money to WSEX.
Had the judges followed the case law then the bet would have originated in Antiqua and accepted in Antiqua which qualifies for an exemption in the Wire Act.
The worst part of Jay's story is that the lawyers that, 1) he consulted before he traveled to the US to surrender to US authorities and 2) WSEX consulted before establishing their business, all opined that WSEX would qualify for this exemption. However, one or more of his friends in Antiqua basically compared US courts to China's when he warned Jay that "they will never let you win." This friend turned out to be right. It makes me wonder about our judicial system.
I think the perceived injustice of the Jay Cohen case is a big reason why Party Poker et. al. left the US market and Neteller founders plead to a deal.

[Merkle]

For my own clarification let me post a situation and let you tell me where the bet took place and if it would be illegal:

I transfer money to Neteller or other site(Isle of Man etc...). I then have it transferred to a casino in Europe. The casino offers a service that allows me to phone in a bet on roulette. When I call the casino from the U.S. and have them do this where did the bet take place?

I did not transfer money to the casino from the U.S. The roulette table is not in the U.S. What if the instructions on how to bet my money was mailed or emailed to the casino?

In the Cohen case did the bettor transfer the money directly to WSEX and would that have made a difference if he hadn't?

[Skallagrim]

The Court in Jay's case ruled that the placing of the bet took place where the bettor was when it was made (NY). The 2nd Circuit agreed, and the SCOTUS declined to hear his case.

This is the state of the law as it stands.

The wrinkle in the Kaplan case is the WTO, its seems pretty unfair even to a judge to have a treaty which gives a foreign company the right to do something, then prosecute them for doing it.

Without the WTO the DOJ has won; is gambling on roulette allowed where you live Merkle? If not, then the principle which got Jay would also get the casino in europe in your example. How the money got there would be irrelevant. (Roulette is not covered by the Wire Act, however - but I dont think thats the point here)

So, according to our DOJ, if China passes a law saying its illegal for a person in a foreign country to give unauthorized news to a person in China, and you give that unauthorized news, you had better not ever visit China (and hope that China never sends anyone to kidnap you back to China, our DOJ and Courts have ruled that even if the kidnapping is illegal, that is no defense to the charge once you are in the country).

Skallagrim

[Jay Cohen]

In my case, the judge ruled that the jury was not allowed to consider 1084(b), the exemption because he ruled that placing a bet in NY was illegal. There is no federal law against placing a bet. Thre is no state law against placing a bet. The AUSA relied on the constitution of the state of NY which has a general prohibition against gambling. However, NY courts ruled in the 1930's that that provision did not apply to the bettor.

Despite that, the judge ruled that it was illegal to place a bet in NY.

The jury came back with questions. One of them was to see a full copy of the law. The judge only gave them 1084(a) and even had his clerk take the "(a)" out so it didn't seem like something was missing.

Much of my testimony was about 1084(b). The jury asked for a read back of my testimony, but half of it was redacted by the judge. They only read portions of my testimony to the jury.

What should I have expected from a judge who was appointed by Nixon and who's first two questions were "What's a mouse? What's a cursor?"

It's very hard to win in Federal Court. It doesn't matter if you have all the case law and facts in the world behind you. If the judge wants it to go the other way, they can do it. It's rare to find a judge who will stand up to the government.

Finally, I want to let everyone know that I do not control the FreeJayCohen site. We let the URL lapse and someone hijacked it and restored the site from web archives. So don't write me there and I can't stand behind all of the material.