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#31
10-08-2007, 11:36 AM
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An \"impairment\" of contracts argument won\'t fly ....
Hypothetically, I have a contract with First State Bank (FSB)to send money to PokerSpot. The US then says sending money to Pokerspot is illegal if it is used for illegal Internet gambling. The intervening "illegality" gives FSB a defense in a breach of contract. That the "determination" is left to First State Bank under the UIGEA regs is irrelevant, especially given the statutory free harbor protection of First State Bank for being too restrictive.
In any event, your damages are contractual and would not result in any injunctive relief against enforcement of the Act. 
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#32
10-08-2007, 11:59 AM
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Re: An \"impairment\" of contracts argument won\'t fly ....
[ QUOTE ]
Hypothetically, I have a contract with First State Bank (FSB)to send money to PokerSpot. The US then says sending money to Pokerspot is illegal if it is used for illegal Internet gambling. The intervening "illegality" gives FSB a defense in a breach of contract. That the "determination" is left to First State Bank under the UIGEA regs is irrelevant, especially given the statutory free harbor protection of First State Bank for being too restrictive. In any event, your damages are contractual and would not result in any injunctive relief against enforcement of the Act. [/ QUOTE ] The key, Milton, is the complete discretion of the bank to decide what is "illegal." What if the transaction is, IN FACT, not illegal? Under the proposed regs and the UIGEA it seems the customer has no remedy. Thats what bothers me. A poster a while back brought up the point of selling software to a site and then having his Echeck as payment declined (lets leave for the moment the issue of money coming back, which appears to be included under the regs even though it is not under the UIGEA itself). That guy should have some remedy to insure his obviously legal transaction is honored, otherwise his contract with the bank is worthless. Or, what if I want to buy a hat from PokerStars. I can prove through documents that I am only buying a hat. The bank still refuses to process the transaction. Again, there should be a remedy to require the bank to honor its contract and process the obviously legal transaction otherwise my contract with the bank is, again, worthless: it can stop anything it wants and I can do nothing about it. Skallagrim
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#33
10-08-2007, 12:45 PM
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Re: An \"impairment\" of contracts argument won\'t fly ....
You could get injunctive relief if the UIGEA violates the US constitution by impairment of the right to contract. I do not know, but it may have been quite a long time since the US Supreme Court has ruled that a statute violated the US constitution on those grounds. But it is one argument to include in potential litigation.
The iMEGA missed it and the vagueness argument. I think that they filed their lawsuit too soon. They should have waited until these proposed regulations were released.
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#34
10-10-2007, 02:14 AM
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Re: An \"impairment\" of contracts argument won\'t fly ....
[ QUOTE ]
The key, Milton, is the complete discretion of the bank to decide what is "illegal." What if the transaction is, IN FACT, not illegal? Under the proposed regs and the UIGEA it seems the customer has no remedy. Thats what bothers me. Skallagrim [/ QUOTE ] Here is an example of a confused bank and perhaps a glimpse of things to come: http://www.pocketfives.com/B7DE0A2B-...7AD63F76F.aspx
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