February has been a productive month for those trying to regulate online gambling in the United States with key victories in state court cases and new legislation on the horizon. In early February a report on Reuters claimed the European Union (EU) was poised to file a complaint with the World Trade Organization (WTO) regarding the Unlawful Internet Gambling Enforcement Act (UIGEA). The potential complaint will likely suggest US enforcement of the UIGEA has unfairly targeted European-based companies but protected similar companies operating in the States.
Since the UIGEA was originally passed as part of the Safe Port Act in late 2006 many online poker companies, including the European-based PartyGaming, pulled out of the US market in an attempt to avoid criminal prosecution. Party still found themselves in legal trouble when the company’s founder, Anurag Dikshit, pled guilty to several charges related to internet gambling in December of 2008. The Reuters report cited EU industry officials who claimed Dikshit’s guilty plea and its accompanying $300 million fine are a prime example of the US Department of Justice bullying European companies.
In an attempt to mend the relationship with the EU on this issue, Rep. Barney Frank (D-MA) is planning on introducing legislation to repeal the UIGEA sometime in March. The specifics of the bill have not been announced yet, but Frank has a longstanding reputation as one of online pokers most ardent supporters on Capitol Hill.
Frank has introduced internet gambling-related resolutions to Congress in previous sessions, but has yet to successfully pass any into law. In 2007 he proposed HR 2046, also known as the Internet Gambling Regulation and Enforcement Act, but it failed to make it to the floor for debate. Frank tried again last year when he co-sponsored HR 6870, a bill designed to clarify some of the vague language and regulations of the UIGEA. The bill passed a committee vote in September, but the more pressing issue of the banking bailout took precedent on Congress’ agenda and the resolution fell by the wayside.
Frank’s upcoming bill will likely seek to overturn the UIGEA and the regulations signed into law by President George W. Bush in the final days of his administration. These regulations, passed on January 19th, state that banks must be in compliance with the law by December 1st. Some critics of the UIGEA, Frank included, suggest this places unnecessary pressure on banks during this time of financial crisis.
Online poker enthusiasts can only speculate on the details of the new legislation, but Poker News Daily and other media outlets are suggesting that an exemption for skill games is entirely possible. Recent state court rulings also affirm the growing popularity of the belief that poker is a game of skill more so than chance and should not be grouped in with other forms of gambling.
In January a Pennsylvania judge ruled poker to be a game of skill and dropped the charges against a couple who ran a rake-free $1/$2 Hold’em game out of their home. Last week a South Carolina judge drew a similar conclusion from the “overwhelming” evidence in his case and also ruled poker to be a predominantly skill-based game. However, the defendants in the South Carolina case were still found guilty because of the lack of any law or on the state law books that clearly distinguished between games of skill and games of chance as forms of gambling.
The new state court rulings as well as the overturning of the initial ruling in the Kentucky court case regarding gambling-related domain names all point towards the growing possibility of legalized and regulated online poker in the USA in the near future.

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