The state of Kentucky's appeal against an appeal entered a new phase at the beginning of April, when the state's 50 page brief was accepted by the Kentucky Supreme Court. The Bluegrass state is appealing a decision by the Kentucky Court of Appeals, which overturned a lower court ruling permitting the seizure by the state of Kentucky of 141 international domain names belonging mainly to online gambling companies (see previous InfoPowa reports).

The successful appeal against the seizure order was obtained by the Interactive Media Entertainment and Gaming Association (iMEGA) and the Interactive Gaming Council, which must now file response briefs with the Kentucky Supreme Court by June 1st 2009.

According to a Poker Daily News report, the Kentucky Justice and Public Safety Cabinet brief opens with the allegation: “Wagers are accepted in an unregulated underworld without effective age verification, identification, or financial accountability… Persons can instantly wager and lose retirement savings or college funds in secrecy.”

PND reports that the Commonwealth of Kentucky also notes that internet gambling may be cutting into its revenues for legalised forms of gaming, including horse racing, and that 2 500 “unregulated sites” solicit U.S. customers. The state's outsourced lawyers claim that according to a Casino City study in 2006, the online gambling sites include 1 083 online casinos, 592 sports books, 532 online poker rooms, 224 Bingo sites, 49 skill game websites, 30 betting exchanges, 25 lotteries, and 17 backgammon sites.

Commonwealth attorneys refer the Court to Party Gaming Co-Founder Anurag Dikshit’s $300 million settlement with the U.S. Government in December of 2008; decisions by ClearChannel and Infinity Broadcasting to cease running advertisements for online gambling sites in 2003, after threats from the DoJ; a $7.2 million settlement between Sporting News and the U.S. Department of Justice in 2006, and the arrests of the founders of Neteller and a settlement with that company.

The old DoJ legal tactic of questioning the standing of iMEGA and the IGC to represent the domain owners is also attempted in the submission despite the federal court ruling last March of Judge Mary L. Cooper, which granted iMEGA standing to sue to declare the Unlawful Internet Gambling Enforcement Act (UIGEA) unconstitutional, a case that is currently also on appeal.

At some stage post-June 1st a hearing date will have to be set for the Kentucky Supreme Court to consider the submissions from both parties.

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