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  #1  
Old 11-03-2007, 08:56 AM
Cactus Jack Cactus Jack is offline
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Default A question for the lawers

The Court in California ruled that poker is a game of skill.

The Tax Court has ruled that poker is a game of skill.

Why aren't these precedents used to differentiate poker from other gambling issues?

Is this like abortion, still debated despite being the law of the land for a generation?

CJ
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  #2  
Old 11-03-2007, 11:59 AM
JPFisher55 JPFisher55 is offline
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Default Re: A question for the lawers

Basically each state has different laws and rulings. So for state law you have to interpret each state's laws.
The tax court decision does not necessarily apply to other laws. But a the federal Fifth Court of Appeals ruled that the Wire Act only applies to sports betting. Yet, the DOJ insists that it applies to all internet gambling and gaming. However, the DOJ has never prosecuted a poker only website or business concern. Cardplayer carries ads for poker websites, using the .com address in the ad.
IMO, the poker sites that left the US market did not have to leave unless they offered sports betting. But they did not want to risk a legal battle with the DOJ. Most ewallets left the US market because they provide services to sports betting sites, which is the basis for the prosecution against the Neteller execs under the Wire Act. I still think that the Neteller execs had valid defenses, but they settled. OTOH Epassporte openly serves US customers, but will only service poker only sites. The DOJ has not prosecuted Epassporte. Without a real test case with a prosecution by DOJ against some online poker concern, the law is still a matter of legal opinion, but the DOJ's failure to act IMO shows its real legal opinion.
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  #3  
Old 11-03-2007, 12:27 PM
DeadMoneyDad DeadMoneyDad is offline
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Default Re: A question for the lawers

[ QUOTE ]
Basically each state has different laws and rulings. So for state law you have to interpret each state's laws.
The tax court decision does not necessarily apply to other laws. But a the federal Fifth Court of Appeals ruled that the Wire Act only applies to sports betting. Yet, the DOJ insists that it applies to all internet gambling and gaming. However, the DOJ has never prosecuted a poker only website or business concern. Cardplayer carries ads for poker websites, using the .com address in the ad.
IMO, the poker sites that left the US market did not have to leave unless they offered sports betting. But they did not want to risk a legal battle with the DOJ. Most ewallets left the US market because they provide services to sports betting sites, which is the basis for the prosecution against the Neteller execs under the Wire Act. I still think that the Neteller execs had valid defenses, but they settled. OTOH Epassporte openly serves US customers, but will only service poker only sites. The DOJ has not prosecuted Epassporte. Without a real test case with a prosecution by DOJ against some online poker concern, the law is still a matter of legal opinion, but the DOJ's failure to act IMO shows its real legal opinion.

[/ QUOTE ]

IMO the test on e-pass will be after the UIGEA regs are finalized.

As I understand it in CA, and Tuff would know this better, the rules are not skill vs no skill but "controled game." So to me the skill agrument has some validity but isn't controling.


D$D
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  #4  
Old 11-03-2007, 12:44 PM
checktowin checktowin is offline
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Default Re: A question for the lawers

good point
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  #5  
Old 11-03-2007, 12:57 PM
tangled tangled is offline
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Default Re: A question for the lawers

[ QUOTE ]
Basically each state has different laws and rulings. So for state law you have to interpret each state's laws.
The tax court decision does not necessarily apply to other laws. But a the federal Fifth Court of Appeals ruled that the Wire Act only applies to sports betting. Yet, the DOJ insists that it applies to all internet gambling and gaming. However, the DOJ has never prosecuted a poker only website or business concern. Cardplayer carries ads for poker websites, using the .com address in the ad.
IMO, the poker sites that left the US market did not have to leave unless they offered sports betting. But they did not want to risk a legal battle with the DOJ. Most ewallets left the US market because they provide services to sports betting sites, which is the basis for the prosecution against the Neteller execs under the Wire Act. I still think that the Neteller execs had valid defenses, but they settled. OTOH Epassporte openly serves US customers, but will only service poker only sites. The DOJ has not prosecuted Epassporte. Without a real test case with a prosecution by DOJ against some online poker concern, the law is still a matter of legal opinion, but the DOJ's failure to act IMO shows its real legal opinion.

[/ QUOTE ]

But hasn't the poker only sites, like Party, broken tax laws by failing to report the winnings of some of their bigger players to the IRS?
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  #6  
Old 11-03-2007, 02:08 PM
Skallagrim Skallagrim is offline
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Default Re: A question for the lawers

JP's is a good summary. There are a couple of other points to be made: both the CA and MO supreme courts ruled poker was not a "Lottery," lotteries being barred by their state constitutions. Each of them also held, to one degree or another, that a lottery was any wagering scheme in which chance was predominant over skill. So it is correct, though not exact, to say they ruled poker more skill than chance. CA's statute covering cardrooms is where the distinction is made between controlled and uncontrolled games. Only poker where a rake is taken (hence making it a "percentage" game) is a "controlled" game in CA.

The Lower Court in the Baxter case explicitly ruled poker a game of skill, but by the time it got to the SCOTUS, the issue was much narrower, and it really only held that since Baxter was exercising at least some amount of skill when he played poker, he could file as a business (a pro) and treat his poker income as "earned" income.

All these cases help us, but they dont completely decide the issue due to slight variations in each state's gambling law.

That poker is not illegal as a matter of Federal law is now pretty well accepted thanks to the Mastercard case inthe 5th Circuit. But technically this case is not binding on the other circuits nor, of course, to the SCOTUS. That DOJ declined to appeal it to the SCOTUS shows they know the SCOTUS, and other circuits, would likely agree.

The DOJ knows full well that they could lose a prosecution of a poker-only site or an e-wallet that limits its funding to just poker, and this scares them. They could also win, which scares some sites.

And skill v luck is only ONE issue for this court case - international law, commerce clause law, and certain UIGEA specific language (is a poker site in the "business" of betting and wagering when it obviosly does not bet or wager itself? e.g.) all make this a very complicated issue.

Which is precisely why the regulations, if they ever formally come, will not mean much. The regulation writers have already taken the clear stand that they will not try and reslove the issues I have listed above - they want the banks to guess at the answers, which may or may not be worse for us, depending on the final regulation specifics.

PS -since there is no formal regulation of online gaming for offshore cites, they are not violating the tax law by not reporting "wins" over a certain amount (the only applicable reporting law). A US poker site would be though.

Skallagrim
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  #7  
Old 11-03-2007, 02:26 PM
JPFisher55 JPFisher55 is offline
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Default Re: A question for the lawers

Good points Skall. If any test of Epassporte comes if, and after, the regs are final, it will be litigation to have online poker and, thus Epassporte, declared by a court to be lawful because banks are blocking its transactions.
BTW, Skall what do you think about the delay in the decision of the iMEGA case? I cannot figure out why the regulations are so important to the granting of a preliminary injunction, except that they may help iMEGA. Does the delay mean that the suit will not be dismissed for lack of standing?
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  #8  
Old 11-03-2007, 06:26 PM
Skallagrim Skallagrim is offline
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Default Re: A question for the lawers

JP, you are a lawyer too, you know a delay BY A JUDGE in making a decision can mean anything [img]/images/graemlins/wink.gif[/img] .

But the likely problem is that the shotgun approach of the iMega suit means the judge has to make multiple rulings, not all involving the same law or arguments.

I believe a fair bit of the iMega suit will survive the standing/ripeness challenge, but not all of it. I a pretty sure all parts that concern the still unadopted regulations will go, and the judge will probably exclude other areas that dont directly affect affiliates, the only specific persons (as far as I know) iMega has identified in their "group" of plaintiffs. But it is hard to say for sure at this early stage of the litigation.

Skallagrim
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  #9  
Old 11-03-2007, 09:54 PM
MiltonFriedman MiltonFriedman is offline
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Default \"Delay\" by the iMEGA Judge means nada, zilch, zip ...

As the man said at each passing floor, having jumped from the roof, "So far, so good."

Chance of outright dismissal of all counts remains about 70%, with no ruling on the merits

Chance of dismissal, with a very negative ruling on the merits 25%

Chance of denial of preliminary injunctive relief against the promulgation (issuance) of the Regulations 0%,

Chance of denial of preliminary relief, but allowing further discovery/proceedings 5%

These guesses are certainly better grounded than yet more mindless cheerleading on the way to the pavement.
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  #10  
Old 11-03-2007, 11:18 PM
JPFisher55 JPFisher55 is offline
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Default Re: \"Delay\" by the iMEGA Judge means nada, zilch, zip ...

Milton, I think you are way too pessimistic. If the judge was going to dismiss the lawsuit, then she would have by now. Why wait and deliberate this long? I still think that the most likely outcome is denial of all motions to dismiss and for preliminary injunction with the case proceeding to discovery and trial.
Skall, I have limited experience in litigation. But the few times that I have seen this long a time for a decision tends to favor the side with the hardest decision for the judge which is usually the plaintiff. But I agree anything could happen.
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