“Though we’re not across the finish line yet, the committee vote is significant progress,” said iMEGA chairman Joe Brennan Jr. “We’ve gotten to this point by making this debate about more than taxes from gaming revenue, which is a bit one-note. Instead, we’ve made a significant case for job creation, capital investment, and the opportunity for New Jersey to become the national and global hub for this industry. And those numbers make this a compelling option for New Jersey legislators to consider.”

iMEGA commissioned an economic development study by Econsult, a Philadelphia-based firm, to provide a conservative baseline projection of the economic benefits for an in-state only system, as well as a baseline should New Jersey establish itself as the hub for the industry nationally and internationally.

With the creation of an intra-state Internet gambling system, Econsult estimated that New Jersey could see the creation of up to 1,900 job, $250 million in annual gross gaming revenue and up to $55 million in annual state gaming taxes. Projecting outward, Econsult estimated that conservatively, New Jersey stands to realize the creation of up to 57,000 jobs, $7 billion in annual gross gaming revenue and up to $472 in annual state gaming taxes should it establish itself as the dominant hub for the industry.

“This industry has to offer more than just an opportunity for the state and operators to take revenue out of the population,” said Brennan. “It can have a more direct, positive affect than just increased tax revenues for the state to utilize for services. Being an engine for real job creation and attracting investment, and the opportunity to be the global hub for a high-tech industry is a much more meaningful opportunity for legislators to consider.”

Link
Download: iMEGA/Econsult i-Gaming Economic Development Study for NJ

The Supreme Court had issued an intermediate decision, saying that none of iMEGA’s “numerous [and] compelling” arguments in defense of the domain owners could be considered until the association satisfied the Court’s standing requirements. iMEGA last week submitted affidavits from both the association and Yatahay Limited, owner of the TruePoker.com domain name, to establish that one or more of the affected domains’ owners were members of iMEGA.

In the intermediate decision, the Court had also indicated that iMEGA and the other appellees, including Interactive Gaming Council (IGC) and Sportsbook.com, could ask the lower court to immediately move the suit back to the Supreme Court. iMEGA’s attorneys submitted such a request at the same time it provided the affidavits.

“Reading the Supreme Court’s decision, it was clear they wanted this suit back as soon as possible, and we’re happy we were able to comply,” said iMEGA chairman Joe Brennan Jr. “We’re confident the Court will make a ruling soon, and that we’ll finally wrap this up.”

Links
iMEGA, et al v. Commonwealth of Kentucky: Order Recommending Transfer (PDF format)

The Supreme Court asked that iMEGA and IGC to file affidavits, asserting that one or more of their members were the owners of an affected domain name, so the Court could then make a ruling on the merits, which many experts believe favor iMEGA and its members.

iMEGA’s attorneys filed two affidavits to satisfy the Supreme Court’s request.  The first affidavit was on the behalf of Yatahay Limited, the company that owns the rights to the domain name “TruePoker.com”. Yatahay Limited declared their membership in iMEGA, making it the first company to come forward and identify itself as an affected party.

The second affidavit was on the behalf of Joe Brennan Jr., iMEGA’s chairman, confirming TruePoker.com’s domain rights holder as a member of the trade association.

The declarations satisfy the standing requirements outlined in the state Supreme Court’s decision.  In its intermediate ruling, The Court stated that iMEGA’s arguments against the seizure of the 141 domains were strong, but that the association must first meet the standing requirements before their arguments could even be considered.

“The owners of the “TruePoker.com” domain have taken a big step on the behalf of the industry and players,” iMEGA’s Brennan said. “We’ve overcome the technicalities that gave the Commonwealth their short-lived victory. The Court can now make a decision based on Kentucky law. Based on the language of the decision last week, we know the Court wants to do just that. We know that the law favors us, and frankly, so does the Commonwealth’s attorneys.”

iMEGA’s attorneys also made a motion to have the matter immediately transferred back to the Kentucky Supreme Court, as was recommended by the Court in their decision last week. The Court also said that additional briefings or arguments were not needed for it to make a ruling on the merits, another sign, along with the recognition of the strength of iMEGA’s arguments, that has led experts to say the Court is likely to rule in favor of iMEGA and the rest of the affected parties.

“The Commonwealth’s attorneys knew they were lucky to get this one into overtime,” Brennan said. “It’s time to put them away.”

Links
iMEGA v. Wingate & Commonwealth of Kentucky (PDF format)
Motion for Intermediate Relief - iMEGA v. Wingate & Commonwealth of Kentucky (PDF format)
Motion to Transfer: iMEGA v. Wingate & Commonwealth of Kentucky (PDF format)

While not a final ruling by the Court, the decision is being viewed as a temporary setback by the affected parties. “In the written decision, the Court clearly indicates they agree with our arguments, and are inviting us to refile, so that the technicality of the standing issue can be resolved,” said Joe Brennan, iMEGA chairman. “It’s unfortunate, but I can’t imagine that Kentucky’s lawyers will celebrate a ruling that says ‘bring us an owner, so we can rule in your favor’”.

iMEGA and the other affected parties, Interactive Gaming Council and Sportsbook.com, have up to 20 days to file a motion for reconsideration. In the ruling, the Supreme Court indicated that no additional briefs or oral arguments were necessary for them to consider the case, and that a petition could be made to the Appeals Court to move the case immediately back to the state Supreme Court.

“All along, it seemed the Court wanted to go our way, and this decision today indicates that is still the case,” Brennan said. “The Court is telling us that all that is necessary is for one domain owner to come forward, and we likely win.”

Brennan indicated that iMEGA would immediately set to work with the other parties to resolve the Court’s issue, and would quickly file a motion to satisfy the court.

“We obviously would have preferred a complete, clean victory today, but reading the decision, it seems this is a technicality that is only delaying the inevitable,” Brennan said.

Link

KY Supreme Court: Decision in Commonwealth v. iMEGA, et al

In January 2009, iMEGA, who was also joined by the Interactive Gaming Council and Sportsbook.com, won a decision from the Kentucky Court of Appeals that blocked Kentucky from seizing the rights to 141 Internet domain names related to online gambling. Kentucky’s lawyers appealed that decision to the state’s Supreme Court, and both sides argued the case before the Court in October 2009.

Links
Webcast - Kentucky v. iMEGA, et al: KY Supreme Court (courtesy of thePPA.org)
KY Supreme Court order - Commonwealth of Kentucky v. iMEGA, et al
iMEGA Kentucky Supreme Court Brief (PDF format)
iMEGA v. Judge Thomas D. Wingate - KY Court of Appeals decision (PDF format)
iMEGA v. Judge Thomas D. Wingate - KY notice of appeal