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June 20, 2013
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State leaders vow to continue fight against unlicensed gambling websites

Settlement with U.S. agencies allows Kentucky to continue lawsuits

Settlement with U.S. agencies allows Kentucky to continue two lawsuits

FRANKFORT, Ky. (June 20, 2013) – Fresh off its $6 million settlement with federal agencies in an online gambling lawsuit, Kentucky leaders pledged to continue its legal battle against unlicensed, unregulated gambling websites.

onlinegamblingAn early version of yesterday’s announcement erroneously stated that the commonwealth had settled its lawsuits against gambling websites PokerStars and Full Tilt Poker. The state actually settled with the U.S. government, not with the online companies, and the settlement was reached by releasing the commonwealth’s claims against certain other domain names.

“This settlement with the U.S. government in the online gambling case increases our resolve to go after the bad actors in the online gambling industry which continue to run roughshod over the regulations designed to protect our consumers,” said Justice Cabinet Secretary J. Michael Brown. “We will not rest until all these unauthorized companies are held accountable for their actions.”

The state actively is pursuing its lawsuits against PokerStars and Full Tilt Poker. In fact, the Franklin Circuit Court recently ruled against PokerStars on its motion to dismiss the lawsuit. Instead, the court ordered PokerStars to submit to discovery concerning its internet gambling activities in Kentucky.

How the federal settlement was reached

As part of its efforts to curb unauthorized, unlicensed gambling, the commonwealth intervened in two federal lawsuits brought by the U.S. government in New York and Maryland. The commonwealth and the U.S. government cooperated with one another in those lawsuits to further their mutual objective of curbing unauthorized, unlicensed internet gambling in their respective jurisdictions as to the specific domain names that were seized.

Specifically, in New York, Kentucky released its seizure claims against the internet domain names, absolutepoker.com and ultimatebet.com, thereby allowing the U.S. government to seize and forfeit those two domain names. The U.S. government paid Kentucky $6 million for releasing its claims against absolutepoker.com and ultimatebet.com.

Kentucky and the U.S. government also agreed to auction three other internet domain names from the Maryland action:  truepoker.com; doylesroom.com; and bookmaker.com. The commonwealth and the U.S. government shared the proceeds from that sale, and the Commonwealth’s share was $75,000.

Separately, the U.S. government released its seizure claim against pokerstars.com, thereby paving the way for Kentucky to continue both of its lawsuits against PokerStars.

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