More Online Gambling Tensions

Another front opens up in the gambling dispute:

A judge in Kentucky seized the Web addresses of more than 140 Internet-gambling sites last week, the latest example of how local governments can affect online businesses with physical operations beyond their jurisdictions.

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In the Kentucky case, Circuit Court Judge Thomas Wingate concluded that gambling Web sites were “virtual keys” that provided access to places where one could play online versions of gambling devices such as slot machines and roulette tables, which are illegal in the state.

None of the online businesses—such as GoldenPalace.com, PokerStars.com and UltimateBet.com—are based in Kentucky or rely on technical equipment located in the state. Still, the sites readily accept bets placed by users in Kentucky and process payments from banks based there. That is what triggered Judge Wingate to seize control of the Web addresses.

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The court said it will lift its seizure order for online casinos if they implement technology that would block Kentucky residents from accessing their sites.

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In the Kentucky case, many of the registrars are based in the U.S. even if the Web sites aren’t, meaning that they have to comply with the court’s order, says Todd Greene, an attorney for Oversee.net, which has a subsidiary called Moniker Online Services that is the registrar for two of the gambling sites.

Here is the court decision.