Internet Gambling Settlement Awards Kentucky

State receives more than $6 million following efforts to halt unregulated wagering.

Kentucky has received a settlement of more than $6 million following its efforts to halt unregulated online gambling in the state.

In 2008 Kentucky's Justice and Public Safety Cabinet filed suit to seize 141 domain names it said were used to conduct unauthorized and unlicensed Internet gambling in the state. The case, Commonwealth of Kentucky ex rel. J. Michael Brown, Secretary, Justice and Public Safety Cabinet v. 141 Internet Domain Names, was the first of its kind in this country.

Three years later, two federal entities, United States Attorneys for both the Southern District of New York and the District of Maryland, brought similar lawsuits against some of the same Internet domain names that had been seized in Kentucky. The Commonwealth joined those federal actions, resulting in the $6,075,000 settlement.

A press release from Kentucky Gov. Steve Beshear July 10 said online gaming giants PokerStars, Full Tilt Poker, Absolute Poker, and Ultimate Bet are no longer operating in Kentucky. In a statement,  Beshear said Kentucky's actions helped protect horse racing, which offers legal interstate pari-mutuel wagering on the Internet, against competition from unregulated Internet gambling.

"As a result of the collective efforts and cooperation of the commonwealth and U.S. Attorneys for the Southern District of New York and the District of Maryland, we've protected Kentucky consumers, our signature horse racing industry, and legitimate charitable gaming interests," Beshear said in a statement. "Unlicensed and unauthorized Internet gambling has been substantially curtailed in Kentucky, and we've created a framework for the rest of the country to manage the issue in their own jurisdictions."

Beshear said the funds will go into this year's General Fund.

"I'm pleased with the disposition of this case with regard to the major players in this arena, and I'm grateful to our legal team for their persistence over the past five years," said Justice Secretary J. Michael Brown, who brought the suit on behalf of the Commonwealth. In his statement, Brown added that Kentucky will continue to pursue action against the remaining Internet sites included in the pending suits.