crAAKKer

Can't Buy Me Love—How the Illuminati Won in PokerStars v. Atlantic Club Casino

2013-05-18T11:53:00.003-05:00

"Didn't you take economics? You could have had me for $49.95."

~"Transfer Girl" (Corissa Miller), in "Can't Buy Me Love" (1988)

In my initial post about the PokerStars v. Atlantic Club Casino litigation, I invoked the classic martial arts flick Bloodsport. And what the Atlantic Club did to PokerStars in court this week does evoke the Bloodsport scene where the villain, Chong Li, intentionally snaps the neck of a helpless opponent. But, on further reflection, the PokerStars-Atlantic Club business relationship over the past few months is actually more reminiscent of the classic 80s comedy, "Can't Buy Me Love". Nerdy outcast convinces popular cheerleader to date him. Nerd becomes popular, fame goes to his head. Nerd dumps cheerleader. Cheerleader freaks out. Nerd and cheerleader both get their comeuppances, learn valuable life lessons, and get back together. Cue happily-ever-after scene as the nerd and cheerleader ride into the sunset ... on a lawn mower.

Obviously there are a few differences between reality and the movies. In real life, the unpopular, near-bankrupt Atlantic Club not only convinced the hottest poker site in the universe to hook up, but PokerStars paid the Atlantic Club nearly $15 million for the dubious privilege. But just like the movie, the Atlantic Club got popular and decided to dump PokerStars. PokerStars freaked out. But then things took an odd turn. The Atlantic Club threw out some vicious gossip and innuendo about PokerStars' trashy past, and it was PokerStars left as the outcast while the Atlantic Club enjoys being the most popular casino on the market, with its choice of online poker sites to hook up with. There won't be any happily-ever-after for these former lovebirds.

Friday's court ruling denying PokerStars' request for a temporary restraining order (TRO) to force the Atlantic Club to abide by the parties' purchase agreement was a serious blow to PokerStars' chances of breaking into New Jersey's newly-authorized online poker market. Pursuant to New Jersey law, PokerStars must own a land-based casino in Atlantic City in order to offer online poker. The financially challenged Atlantic Club was a relatively inexpensive gamble for PokerStars when it wasn't clear if Governor Christie would approve online poker. Now, the Atlantic Club is shopping around for a better deal, and it's not clear whether PokerStars has any other options for casinos to purchase. Heck, it's not even clear now if PokerStars can get a gaming license.

I am most emphatically not a conspiracy theorist. But the more I think about the way the PokerStars v. Atlantic Club Casino litigation went down, the more convinced I am that something is rotten in the state of New Jersey. Atlantic Club's actions leading up to the lawsuit suggested they were trying to leverage a higher purchase price, either from PokerStars or a shadow purchaser lurking in the background. But the Atlantic Club's litigation strategy showed that the termination of the PokerStars deal was about much more than money, it was intended to destroy PokerStars' chances to enter the New Jersey iPoker market altogether.

The key evidence of an anti-PokerStars conspiracy is the Atlantic Club's decision to go nuclear in its response to the TRO, focusing its defense on PokerStars' connections to the Black Friday criminal indictments and civil forfeiture cases. These attacks were legally irrelevant to the claims made by PokerStars. As you will recall, PokerStars raised two primary arguments in its initial Complaint and Motion for TRO: a) Breach of Contract—claiming that the contract termination date was void pursuant to gaming laws requiring a 120-day window between submission of a gaming license application and the closing date for a casino purchase agreement, and b) Promissory Estoppel / Unjust Enrichment—claiming that the Atlantic Club knew the Division of Gaming Enforcement (DGE) would not rule on PokerStars gaming license application prior to the contract's termination date, and yet the Atlantic Club nonetheless improperly misled PokerStars into believing the Atlantic Club had agreed to extend the deadline for PokerStars to obtain its license.

The breach of contract claim is legally and factually straightforward. One simply looks at the contract and the relevant statute, then decides if the contract termination provision violates the statute. Evidence of PokerStars' Black Friday issues is irrelevant to interpreting the contract's termination provision. When the poker media first began reporting even prior to the lawsuit that PokerStars might argue that the contract termination date was invalid under New Jersey gaming law, I immediately had serious doubts that the argument would work (see my comments in response to Diamond Flush's initial reporting of this issue), even without having access to the actual purchase agreement and related documents available to the Atlantic Club's attorneys. After reading the PokerStars Complaint and Brief, I remained skeptical that PokerStars would win on this issue, based only on a general discussion of the purchase agreement's terms. Presumably, the Atlantic Club's attorneys were likewise skeptical of PokerStars' interpretation of the law and were confident about their argument on the termination date issue. In fact, the Atlantic Club actually prevailed on this issue at the court hearing denying PokerStars' request for a TRO, with the court finding that the contract's terms permitted the Atlantic Club to terminate the purchase agreement if PokerStars was not licensed by April 26. Considering the Atlantic Club held such a strong legal position on the breach of contract claim, there was no good litigation purpose for raising PokerStars' Black Friday issues in response to the breach of contract claim. [FN1].

The promissory estoppel / unjust enrichment claims are based on various actions and statements by the Atlantic Club which are alleged to have improperly misled PokerStars to believe that the Atlantic Club had agreed to extend the purchase agreement termination date until after the DGE ruled on PokerStars' application for a gaming license. The evidence to support or refute these claims would be limited to the parties' actions during the period of their business relationship. The Atlantic Club could have responded to PokerStars' claims by arguing that the actions and statements in question were proper and not misleading under the circumstances. Evidence of PokerStars' Black Friday issues which arose two years ago prior to any business relationship would have no relevance to a defense of the promissory estoppel / unjust enrichment claims.

Not only was the Atlantic Club's use of PokerStar's Black Friday issues unnecessary to the litigation, it was also unwise as a business decision. In commercial litigation, it is always important for attorneys to remember that the goal of the litigation is to maximize their client's profit. Here, the TRO hearing was an important legal skirmish, but it does not terminate the litigation nor conclusively decide a winner. All the TRO hearing did was determine which side the court felt was more likely to win based on a limited consideration of key evidence and legal arguments. In theory, the case will continue forward and PokerStars could ultimately win at trial or on appeal.

What the TRO hearing was about, from a business-legal perspective, was which party would have greater leverage going forward. PokerStars and the Atlantic Club had already discussed extending the termination date in exchange for additional funds from PokerStars, and had even exchanged various offers for such an extension. Thus, the Atlantic Club knew PokerStars would likely be willing to continue negotiations on a revised deal regardless of which side prevailed at the TRO hearing. Had PokerStars won at the TRO hearing, they would most likely have agreed to a revised purchase agreement with additional funds in exchange for an extended termination date simply to foreclose the legal risk of losing later in the litigation process. Now that the Atlantic Club has prevailed on the TRO, the Atlantic Club has legal risk from the continuation of the litigation, both the risk of PokerStars later winning on either the contract termination issue or the somewhat stronger unjust enrichment claims which have yet to be addressed by the court. In normal commercial litigation, one would expect the Atlantic Club and PokerStars to work out a settlement of their claims at this point. Further, one would expect PokerStars to make a new, more lucrative offer to buy the Atlantic Club. The Atlantic Club, in turn, would be expected to welcome a financially strong, highly motivated potential purchaser like PokerStars to bid up their other competing suitors for a better purchase price.

Which brings us back to the apparent insanity of the Atlantic Club's litigation strategy. The Atlantic Club's business executives and litigation team presumably want to maximize the Atlantic Club's ultimate sale price. Cutting PokerStars out of the bidding war makes no business sense because PokerStars is known to be a serious potential buyer in the market for an Atlantic City casino, has deep pockets, and can also resolve its claims against the Atlantic Club as part of any potential deal (those claims will factor into the ultimate purchase price of the casino regardless of the buyer). Further, being in the position of seller, the current Atlantic Club owners will have no dog in the New Jersey iPoker fight after any sale closes, so from the perspective of the Atlantic Club, if they sell to a different buyer, they should be indifferent to whether PokerStars eventually obtains a gaming license. The Atlantic Club could have fully defended itself in the TRO hearing without raising PokerStars' Black Friday issues, and certainly could have done so without raising the far more damaging questions about Isai Scheinberg's involvement in the deal. By using the Black Friday and Scheinberg issues in the TRO dispute, the Atlantic Club essentially declared that PokerStars was unsuitable for a New Jersey gaming license, making it impossible for the Atlantic Club to do business with PokerStars.

There is no apparent rational business reason for the Atlantic Club to pursue a litigation strategy that effectively disqualifies PokerStars from the bidding competition for the casino and jeopardizes PokerStars' chances to obtain a gaming license. Unless, of course, those were the Atlantic Club's real goals. What looks irrational turns diabolically clever if one considers that the Atlantic Club has almost certainly been in talks with one or more potential purchasers who are looking to block PokerStars from gaining a foothold in the United States iPoker market. Caesars Entertainment and Boyd Gaming (50% owner of the Borgata) are obvious foes of PokerStars both in New Jersey and nationally, though other iPoker platforms, out of state casinos, and even tribal casinos would all have business interests in keeping PokerStars out of New Jersey. To one or more of these PokerStars competitors, spending several million dollars to buy out the Atlantic Club might well make good business sense. If they are able to sabotage PokerStars' gaming license as well, then that's a great business deal. In fact, to many of PokerStars' competitors, the ability to unleash a vicious proxy attack on PokerStars' suitability for licensing probably was a far more valuable part of any potential deal than acquiring the Atlantic Club itself.

At this point, it seems certain PokerStars will not be able to buy the Atlantic Club, blocking PokerStars from the New Jersey iPoker market for the short term. What is less certain is whether PokerStars will move forward with the gaming license process in hopes of finding a new casino to target for acquisition or as an iPoker partner. It's difficult to know how much damage the Atlantic Club inflicted on the PokerStars gaming license application. The Black Friday issues were old news that PokerStars was presumably ready to address. But having those issues raised publicly, in court, by a business partner as evidence that PokerStars is unqualified for licensing likely escalates the attention the DGE will pay to those issues in the licensing process. More significantly, the Atlantic Club's accusations about the involvement of Scheinberg in the acquisition and licensing processes will almost certainly draw unwanted additional scrutiny from the DGE and possibly the DOJ. Scheinberg reportedly gave the Atlantic Club his estimate that PokerStars had a 90% chance of obtaining a New Jersey gaming license. Right now, if Scheinberg would offer me only 2:1 odds, I would lay a healthy wager against a PokerStars license.

Of course, PokerStars has to take some of the blame for its current problems. Obviously their Black Friday issues stem from a post-UIGEA business decision to remain in the United States market, and a good case can be made that PokerStars should be penalized in some way—up to and including being barred from holding a gaming license—for operating in apparent violation of various state and federal laws. Yet, PokerStars at least deserves a fair hearing to determine whether they broke the law, and if so, whether that is sufficient to preclude licensing. PokerStars also has only itself (and its attorneys) to blame for signing a draconian, one-sided purchase agreement, and for failing to understand and meet the deadlines in that contract. Finally, PokerStars has to be kicking itself for pursuing litigation rather than further negotiation. If the Atlantic Club had made its Black Friday and Scheinberg accusations prior to litigation, those statements could have been used as evidence of the Atlantic Club failing to act in good faith in support of its contractual duties, particularly the duty to assist PokerStars' efforts to obtain a gaming license. By initiating litigation, PokerStars gave the Atlantic Club the pretextual opening it needed to raise those issues: "Your Honor, we hate to say it, but in response to the issues raised in PokerStars' Complaint, we feel compelled to point out that PokerStars has been accused of money laundering and bank fraud, and we just found out this Scheinberg guy we've been dealing with is a fugitive under federal indictment. But anyway, about Section 7.2 of the purchase agreement ...." PokerStars is probably thinking right now that another few days of negotiating and another several million dollars on the deal would be preferable to what happened in court this week.

PokerStars made some mistakes in the Atlantic Club deal, and it's not yet clear whether the damage will be contained to a lost casino deal or will spread to PokerStars' gaming license efforts. The Atlantic Club looks poised to cash in on its backstabbing of PokerStars. The only remaining question is, what company ordered the hit on PokerStars? The smart money is on whoever wins the bidding war for the Atlantic Club.

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[FN1]. The Atlantic Club could try to justify raising the Black Friday issues in connection with the breach of contract claim by asserting that those issues would likely preclude PokerStars from ever obtaining a gaming license as required by the purchase agreement. But this argument would be pretextual, as the breach of contract claim was purely retrospective—because PokerStars failed to meet a past deadline for obtaining a gaming license, the only question was whether that deadline was enforceable. Speculation about how DGE might rule this summer on PokerStars' pending gaming license application is irrelevant to analyzing a past deadline.

Atlantic Club Casino Drops a Neutron Bomb on PokerStars

2013-05-17T15:47:00.001-05:00

The already contentious lawsuit between former—and possibly future—business partners PokerStars and Atlantic Club Casino just turned nasty. The lawsuit in New Jersey state court centers on whether Atlantic Club properly terminated a contract to let PokerStars purchase the casino because PokerStars missed a key deadline tied to obtaining a gaming license. Because the parties' legal filings this week are not yet available to the general public [FN1], I cannot analyze and comment on the relative strengths and weaknesses of the opposing legal arguments. One widely reported argument raised by Atlantic Club, however, does have intriguing legal implications.

A key defense raised by Atlantic Club is that it was purportedly unaware of the most serious Black Friday-related charges against PokerStars and its then-CEO, Isai Scheinberg, until after entering into the purchase agreement. Indeed, Atlantic Club claims it was in the dark about the extent of the Back Friday charges until after PokerStars submitted its New Jersey gaming license application in March. According to Atlantic Club, "significant information emerged publicly that Plaintiffs’ principals were associated with serious criminal activities more extensive and unresolved than previously disclosed." Further, Atlantic Club claimed to have been unaware that former PokerStars executives Scheinberg and Paul Tate had been indicted on a number of federal charges related to offering online gaming illegally in the United States and disguising monetary transactions related to such illegal gaming. Perhaps most significantly, Atlantic Club contends that Scheinberg has been actively involved in the negotiations for the purchase of the casino and in PokerStars' licensing efforts, which implies PokerStars may be in violation of their settlement agreement with the Department of Justice which required Scheinberg to give up any managing role in the company.

As a litigator, my first impression was that Atlantic Club included these allegations mostly in an attempt to throw some dirt at PokerStars. As you will recall, PokerStars had raised certain claims such as breach of the duty of good faith, promissory estoppel, and unjust enrichment which are based in equity (i.e., principles of fairness). In essence, PokerStars claimed Atlantic Club was not acting fairly and in good faith in terminating the purchase agreement. However, a litigant seeking an equitable remedy is generally required to come to court with "clean hands", meaning the party has itself acted fairly and in good faith. By contrast, issues of law—such as PokerStars' claim for breach of contract—apply rules without regard for fairness (though it never hurts to dirty up an opponent even on purely legal issues). So, Atlantic Club's response bringing up PokerStars' Black Friday legal issues is an obvious attempt to undermine PokerStars' entitlement to equitable relief.

Another obvious purpose of raising the Black Friday scandal is to undermine PokerStars' credibility with the court. Given the nature of the charges in the criminal indictments and civil complaints—violations of gaming laws, bank fraud, and money laundering—Atlantic Club is painting PokerStars as an unsavory characters, folks the court should send packing. Of course, this raises interesting questions for Atlantic Club as to why they were doing business with PokerStars in the first place. The official Atlantic Club line is that they were unaware of the serious nature of the Black Friday allegations until the American Gaming Association (AGA) filed a brief in opposition to PokerStars gaming license application. This explanation is pure bovine excrement. The general public might not know about the Black Friday charges, but it was big news in the gaming industry. A gaming executive, even one at a land-based casino, would have known enough about Black Friday and PokerStars' prominent connection to the criminal and civil cases to have done some basic due diligence investigation of PokerStars before getting into bed with them on a multimillion dollar business deal that depended on gaming commission approval. Still, even if the accusations tar Atlantic Club indirectly, the more PokerStars is talking about Black Friday in court, the less likely they are to win their case on the merits.

Which brings us to my personal "neutron bomb" theory. A neutron bomb is a nuclear device much like conventional hydrogen bombs, but specifically designed so that the majority of the bomb's energy is released as neutron radiation instead of explosive energy. The purpose of a neutron bomb is to maximize lethality to people, while minimizing damage to structures. So, a neutron bomb's destructive radius is relatively small, yet it causes death by radiation to people within close proximity (~1500 meters) to the detonation point. Many of those exposed to lethal doses of radiation linger for days or weeks before dying, with no viable treatment options.

The more I think about Atlantic Club's decision to throw Black Friday mud at PokerStars, the less sense it makes if this were a simple contractual dispute. PokerStars has a legitimate shot at winning the breach of contract claim, and specific performance of the contract—requiring the parties to abide by the purchse agreement and selling the casino to PokerStars if they obtain licensing—is the most likely remedy (money damages are often viewed as inadequate if the contract involves sale of property or a similar unique transaction). If there is a real chance the parties will be ordered by the court to continue forward with the deal, then Atlantic Club's muckraking only poisons an already tense relationship for a questionable amount of litigation benefit.

Atlantic Club's focus on PokerStars' Black Friday issues makes complete sense, however, if Atlantic Club has another buyer lined up and simply wants to kill off the PokerStars' deal at any cost, even if that means making PokerStars too radioactive for a gaming license. When the American Gaming Association (AGA) raised the Black Friday issues in its brief to the New Jersey Division of Gaming Enforcement (DGE), those issues did not seem to gain much traction publicly. The Black Friday issues would have been easy for the DGE to minimize in reaching a decision on PokerStars' application for a gaming license. But now those accusations have been made publicly, in court, in a high-profile case, and include accusations that PokerStars has breached its DOJ settlement agreement to keep Scheinberg out of the operations side of PokerStars. Even worse, those accusations are not coming from potential business rivals to PokerStars, as with the AGA brief. Instead, it's the Atlantic Club, a current gaming licensee and party to the proposed sale who claims that its own business partner is unsuitable for licensing. That fact alone is going to make it much more difficult for the DGE to simply whitewash PokerStars' Black Friday issues.

Atlantic Club seems intent on leveraging Scheinberg's apparent influence over PokerStars into evidence that PokerStars is unsuitable for licensing. Of course, without a gaming license, the purchase agreement is dead, whether now or in three months after the DGE's decision on PokerStars' application. In a similar case, DGE pressured MGM Resorts to sell off its New Jersey gaming operations because of DGE concerns that MGM's partner in its Macau operations, Pansy Ho, was too closely tied to her father, Stanley Ho, who is reputed to be connected to Chinese organized crime. DGE would be open to accusations of inconsistency if it now grants a gaming license to a company like PokerStars which has as a behind-the-scenes leader a man indicted for violating United States bank fraud and money laundering laws.

Further, Atlantic Club may be injecting Scheinberg into the debate to create a basis for having Scheinberg subpoenaed to testify in the United States about his current role in PokerStars, either in the litigation with PokerStars, or before the DGE as part of the licensing process, or both. Of course, Scheinberg would almost certainly decline to appear in the United States to avoid being arrested on his outstanding Black Friday charges, but doing so would likely sink the lawsuit and the gaming license.

New Jersey is PokerStars' best and possibly last chance to obtain a gaming license in the United States. If PokerStars continues to pursue the Atlantic Club litigation, Atlantic Club will ratchet up its attacks on PokerStars' Black Friday issues, which in turn will increase the pressure on the DGE to take a hard line in the licensing process. PokerStars could easily win the TRO battle and keep the Atlantic Club purchase agreement alive, only to find that the fight has fatally poisoned its chances to obtain the gaming license it needs both to complete the Atlantic Club purchase and to pursue licensing in other states. The Atlantic Club, on the other hand, would walk away relatively unscathed, $15 million richer, with its business operations intact and ready for sale to another, higher bidder.

With Scheinberg and Black Friday, the Atlantic Club may have created itself a litigation neutron bomb. If PokerStars presses their current lawsuit, don't be surprised if their hopes for a gaming license take a significant, even fatal, hit.

UPDATED (5/17/2013; 3:52 PM): As I was editing and hitting "publish" on this post, news broke that, following today's hearing, the judge in the PokerStars-Atlantic Club Casino case lifted the TRO. This will permit Atlantic Club to move forward with a sale to another buyer. This ruling effectively ends the effort by PokerStars to buy the casino, but PokerStars could still continue to fight to recover the $15 million it has sunk into the casino to keep it operational during the term of the purchase agreement. The more intriguing question is whether the Scheinberg-Black Friday issues have already made PokerStars too radioactive for licensing in New Jersey, and effectively elsewhere in the United States.

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[FN1]. Although there have been a lot of filings by both parties this week, New Jersey's state court system does not provide online access to court records, and my New Jersey legal contacts have not been able to obtain copies of documents directly from the court (likely because the judge has the file for a key hearing on PokerStars' request for a temporary restraining order later today). However, at least two journalists—John Brennan of the "Meadowlands Matters" blog for and "Diamond Flush" of the eponymous poker blog—have either been provided copies of the parties' recent filings or had access to those filings and have provided excellent, detailed summaries of the legal jujitsu. Brennan's posts summarize Atlantic Club's resistance to the TRO, reviews the timeline of key events, notes the views of a number of "big gun" experts retained to support Atlantic Club's view of a key gaming law issue, and summarizes PokerStars' reply to Atlantic Club's arguments. Diamond Flush—who confirms she has a confidential source with access to the legal proceedings—has provided substantially more detailed summaries of the Atlantic Club's resistance to the TRO and supporting affidavits, as well as PokerStars' reply to those arguments. Most intriguing, however, was Diamond Flush's reporting (which I don't recall seeing covered elsewhere) of the details of an emergency court hearing held on May 7 in which Atlantic Club attempted to have the initial TRO rescinded prior to the original hearing date of May 17. The presiding judge denied that request, which is not unusual, though the hearing is quite interesting as it helps understand how the parties and the judge are framing the issues.

PokerStars v. Atlantic Club Casino—What to Watch for in Atlantic Club's Response

2013-05-13T15:16:00.001-05:00

As most folks in the poker world are aware, the Rational Group—parent of online poker behemoth PokerStars—has filed suit against Resorts International and other defendants with respect to a dispute over an agreement for PokerStars to purchase the Atlantic Club Casino. The purchase of the Atlantic Club was—and maybe still is—the best vehicle for PokerStars' entry into the legal U.S. online poker market. The apparent failure of the deal has been covered by former corporate attorney turned poker journalist Dave "FTrain" Behr for Flushdraw.com (Part 1 and Part 2). Behr (at Flushdraw.com) along with poker journalists DiamondFlush (at DiamondFlush.com) and Chris Grove (at QuadJacks.com) have each provided excellent analyses of the initial Complaint and accompanying Motion for Temporary Restraining Order (TRO) and supporting Brief (thanks to Grove and QuadJacks for obtaining and sharing the original pleadings).

At this point, there's not much for me to add to the excellent work noted above, mostly because to this point we—and the Court—have seen only one side of the case. However, my 18-year career has been spent mostly as a litigator specializing in defending a variety of civil lawsuits, primarily insurance, financial, and commercial in nature. As a civil defense attorney, when looking at an initial Petition or Complaint, my first instinct is to ask, "What's missing? What didn't the Plaintiff or Petitioner tell the Court?" Often what's not mentioned in the Petition or Complaint are matters that go to the heart of the dispute. With respect to the PokersStars v. Atlantic Club Casino Complaint, there are several key factual issues that need to be fleshed out in the Atlantic Club's Response due later today. Three issues in particular deserve to be put on a "watch list" for when Atlantic Club files its Response.

I. What does the Purchase Agreement state regarding the "Outside Date" and PokerStars' Obligation to Become Licensed?

The first, and most critical issue, is the exact contractual definition of "Outside Date", and the contractual significance of that date. Regrettably, the Purchase Agreement itself is not yet publicly available (though it was filed with and available to the Court). However, PokerStars makes repeated reference to various provisions of the Purchase Agreement throughout its Complaint and Brief, including quoting or even block-quoting several key provisions.

However, the Complaint and Brief cite to, paraphrase, but do not quote the relevant contractual provisions which apparently set an "Outside Date" for completion of certain aspects of the deal (referred to as Section 7.2), and also set forth the requirements for PokerStars to obtain a casino license (referred to as Section 5.5.). The failure to quote contractual terms is always a red flag to a litigator, because the precise contractual language is nearly always critical to the proper construction and interpretation of a contract.

In this particular case, the exact terms of the Purchase Agreement related to licensing and the "Outside Date" are critical because PokerStars is arguing those provisions run afoul of the following provision of the New Jersey gaming statutes:

[W]henever any person contracts to transfer any property relating to an ongoing casino operation … under circumstances which require that the transferee obtain casino licensure … the contract shall not specify a closing or settlement date which is earlier than the 121st day after the submission of a completed application for licensure or qualification… Any contract provision which specifies an earlier closing or settlement date shall be void for all purposes.

PokerStars argues that its application was not "completed" until April 11, 2013, and thus any contractual provision for an "Outside Date" less than 120 days later (before August 9, 2013) would be void pursuant to law.

The problem with PokerStars' argument is that it is not clear whether the Purchase Agreement actually violates the statute. First, the term "Outside Date" is not defined. To violate the statute, the "Outside Date" must be a "closing or settlement date". A "closing date" is generally understood to be the date when control and ownership is transferred to the purchaser, and payment is made to the seller. A "settlement date" is generally understood to be the date payment is made for a previous transfer of goods or property. In the context of gaming control regulations connected to licensing of a previously unlicensed owner, "closing or settlement date" would appear to be the date when the purchaser takes control of the casino after receiving its license; the 120 day statutory requirement is to ensure there is sufficient time for gaming officials to consider, investigate, and make a determination as to the purchaser's suitability for licensing.

However, for those of us who have been involved in large business sales, it seems unlikely that the "closing date" is the same as a licensing date. Closing on a large business sale like this requires significant "due diligence", including transferring deeds, clearing liens, assigning contracts and accounts, and reviewing employment and labor contracts (the PokerStars Complaint and Brief take Atantic Club to task for failing to provide paperwork on several of these types of due diligence issues). The more common practice where regulatory approval is required for a transaction would be to designate a deadline for obtaining necessary approvals or licenses, and a later date for the actual closing of the transaction.

In the present case, PokerStars' obtaining licensing by a particular date might be a condition precedent for closing the deal, not the closing date itself. In other words, the "Outside Date" might refer to a deadline by which PokerStars was to be licensed to keep the deal alive, with a later formal closing date (perhaps tied to the date of licensing; e.g., "Closing shall occur within 30 days of PokerStars receiving a valid gaming license."). Or, the "Outside Date" might be a deadline on the entire deal itself; if all requirements are not met by that date, then the Purchase Agreement terminates. In such a case, the "Outside Date" would operate not as a closing date, but as the expiration date on an option to buy the casino (and it is unquestioned that the Purchase Agreement provided more than sufficient time from the date of signing in which PokerStars could have submitted a "completed application" and still had 120 days before the "Outside Date"). Similarly, there might be other deadlines in the Purchase Agreement which are not tied to licensing which PokerStars missed because of the licensing delays.

Of course, without the Purchase Agreement, we are in the dark as to what was meant by the term "Outside Date", and whether that "Outside Date" was the equivalent of a "closing or settlement date" pursuant to the relevant statute. But the Atlantic Club will need a convincing argument that the closing date statute has not been violated to avoid being found in breach of the Purchase Agreement.

II. What is the Atlantic Club's explanation for appearing to mislead PokerStars into thinking the "Outside Date" would not be enforced?

In its claims for unjust enrichment and promissory estoppel, PokerStars outlines a number of communications and actions by the Atlantic Club which PokerStars claims unfairly gave the impression that the Atlantic Club was not going to enforce the "Outside Date" and terminate the Purchase Agreement. Both of these claims are equitable in nature, based on principles of fairness where one party has misled another party to its detriment. Principles of equity generally will not operate to void valid contractual provisions; equity is not intended to save parties from bad deals, only to remedy unfair conduct.

Here, the Purchase Agreement will again be key. Often contracts have "non-waiver of default" provisions that state a party can choose not to invoke a remedy for one default without waiving the right to later pursue a remedy for a future default. Here, the Atlantic Club might argue it was cooperating with PokerStars to make the deal work until it became obvious that the closing time frame was too far removed from the original "Outside Date" and it needed to terminate the Purchase Agreement and pursue other options.

The Atlantic Club will also need to answer what I view as PokerStars' strongest argument—PokerStars has paid advances of $11 million, and is potentially on the hook for an additional $4 million penalty, which is roughly equivalent to the full purchase price of the deal. Thus, termination of the Purchase Agreement essentially works a forfeiture of the entire purchase price. Generally speaking, the law frowns on forfeitures. However, if forfeiture of advance payments is a remedy spelled out in the Purchase Agreement, it likely is enforceable as a bargained-for condition of the contract.

More troubling is the allegation that the Atlantic Club demanded certain advances on construction costs associated with refurbishing the casino for PokerStars, including building out a poker room. Some of these demands for advance payments were made after the time when it appears the Atlantic Club was already considering terminating the Purchase Agreement. How the Atlantic Club responds to these complaints is also important. However, even if some of these actions by the Atlantic Club are found to be improper, the Court may nonetheless determine that the appropriate remedy is only reimbursement of specific payments made after the date the Atlantic Club determined the deal would not meet the contractual deadline. PokerStars' preferred remedies of either specific performance of the contract or reimbursement of all payments may both be rejected even if PokerStars demonstrates detrimental reliance on some of the Atlantic Club's statements and demands.

III. Spot the malpractice.

Assuming that the major issues are whether the "Outside Date" complies with New Jersey law, and whether the Purchase Agreement provides for forfeiture of advance payments if PokerStars did not obtain a gaming license, the obvious question will be "What lawyer dropped the ball?" These issues are so legally obvious, so critical to the business deal, and of such a major financial magnitude that the attorneys drafting the Purchase Agreement and giving the parties advice on how to proceed pursuant to that contract have to be sweating profusely about how to explain any potential loss in Court to their respective clients.

Get your popcorn. This lawsuit promises to be legal Bloodsport.

Annie Duke: Ultimate Shill, Penultimate Cheat? UPDATED with Annie Duke Comments

2013-05-11T19:02:00.000-05:00

As the Ultimate Bet scandal recordings continue to stir up the poker community, one intriguing, polarizing name has popped to the surface—Annie Duke. As mentioned in my prior post on the Ultimate Bet recordings, on the main three-hour recording, Russ Hamilton calmly states, ""Annie Duke used it [God-mode cheating software] on a fifteen minute delay quite a few times." On a second, somewhat shorter recording also released yesterday, poker media guru Kevin "Kevmath" Mathers reports that Hamilton stated Duke used the God-mode cheating software on a five minute delay. Certainly Duke has been accused of improperly looking at opponents' hole cards in live play (albeit by her nemesis, Daniel Negreanu), but this accusation of online cheating was completely new.

Creating further intrigue is a post by TwoPlusTwo member "dougmanct" (who has "Centurion" status at the site) which casts doubt on whether the "God-mode" cheating software could operate on a time delay:

"Just want to point out, as the researcher who collected UB client software and decompiled/examined it at great length to understand the specific cheating mechanism, I can tell you it never appeared to function on a "time delay"; i.e. revealing hole card data only after a certain period of time had elapsed. The cheat code appeared to reveal opponent's hole cards in real time as a hand was being played. I suppose one could have recorded a table using the cheat client and made the recording available to someone on a delay, but that seems like quite a bit of effort and at the very least, someone doing so would be quite aware the ability to cheat existed and chose not to come forward/be complicit in keeping the cheat ability secret for their own gain."

The official Kahnawake Gaming Commission (KGC) report regarding the Ultimate Bet cheating scandal likewise seems to suggest that the "God-mode" cheating software only operated on a real-time basis:

INITIAL INVESTIGATION

….

After several weeks of Commission investigation of the source code, a method was detected by which specific users could gain access to “hole” card data in real time. Once the cheating method was identified, the Commission’s agents confirmed through the audit process that:

1. The illicit software allowed only two accounts—AuditMonster1 and AuditMonster2—to access hole card information;

2. These two accounts were able to access hole cards via the normal poker client;

3. The “stealth observer” function was located in the normal code base where the normal card messages were sent to the poker client; and

4. The illicit software was disabled on UB servers on February 2, 2008.

The Commission also confirmed that when Tokwiro acquired UB, it was only provided with source code history dating back to November 29, 2005. The source code history of the Ultimate Bet poker software showed that the illicit code was not modified after November 29, 2005. Attempts to obtain source code historical records from prior to November 29, 2005 from the original developers were unsuccessful.

ANATOMY OF THE CHEATING

The following is an overview of the methodologies used to perpetrate the cheating incidences, based on the information the Commission obtained during the course of its investigations:

....

3. To perpetrate the cheating, one or more individuals logged into the UB client software using an account that accessed the illicit software. The name of the account was “AuditMonster2.” An additional account (“AuditMonster1”) had the same privileges, but there is no evidence this account was ever used;

4. The “AuditMonster2” account was used to view hole cards, but was never used to play in a game. Rather, the responsible individual(s) gathered hole card information using this account, and then employed a variety of other accounts to use the hole card information to cheat other players in actual money games; and

5. The user names of the player accounts maintained by the responsible individual(s)—see the list below—were changed repeatedly over the course of the cheating scheme in an apparent attempt to avoid detection.

Based on the information available, it seems unlikely Annie Duke ever used the "God-mode" cheating software as alleged by Hamilton. First, because Hamilton knew he was recording these conversations, any of his statements on the tape that are not damaging to Hamilton himself ("admissions against interest" in legalese) must be viewed with some skepticism. Second, unless Hamilton and Duke were in on the scam together, it seems unlikely Hamilton would give Duke access to one of the only two "AuditMonster" accounts that could support real-time cheating, nor that he would risk letting her know of the scam. Third, there is no evidence to date of Duke displaying any of the hallmarks of this type of scam: improbable cash game results, large player-to-player transfers, or large cashouts.

One other possible way to reconcile the real-time operation of the "AuditMonster2" account and Hamilton's comments about Duke using it on a time delay would be to surmise that there was a similar program used to monitor play in near-real-time for legitimate audit and security purposes. If such a program existed, an unscrupulous player might use it to gain access to hole card information to which they were not otherwise entitled, which undoubtedly would give them an improper edge over their opponents, and would be the type of cheating that should disqualify a player from online poker sites, much like multi-accounting, ghosting, chip dumping, and collusion have disqualified other players. If Duke did use such software to gain an improper advantage, she certainly deserves to be banned from poker. At this point, however, we have only the word of an admitted thief and scam artist as evidence of Duke's cheating. Without some kind of independent corroborating evidence, Hamilton's accusation, while scandalous, is still merely innuendo.

UPDATE (5/11/2013: 8:15 CDT): A screenshot of Annie Duke's Twitter responses to the hole card viewing accusations was posted on TwoPlusTwo. Essentially, Duke claims she only had access to hole cards while doing broadcasts of a limited number of online tournaments. While this would be a legitimate use of such a technology, it doesn't square with Hamilton's statements which implied Duke used the God-Mode software during her own play. Also, if Duke knew God-Mode software was available even for such limited purposes, why did she seem to pass it off in interviews and testimony (see below) as an improper "breach" of the software by a rogue employee? Much like Hamilton's comments, Duke's comments are obviously self-serving and should be viewed skeptically absent corroborating evidence.

UPDATE (5/14/2013; 8:47 AM CDT): Martin "Short-Stacked Shamus" Harris has posted at Fushdraw.com an excellent analysis of two significant areas of concern with Duke's statements. First. the real-time viewing of hole cards by poker commentators was not commonplace until recently. Second, Duke's boyfriend (who had little poker experience) won an Ultimate Bet tournament—and $266,000—while Duke provided commentary. As with most things connected with Ultimate Bet, there are a lot of implausible stories and statements, but they are difficult to either corroborate or debunk.

UPDATE (5/18/2013; 10:42 PM CDT): Annie Duke has released a lengthy statement denying any involvement in the Ultimate Bet scandal, and further asserting she has never used or been made aware of any "God mode" or other software that would allow her to see player hole cards in real-time or on a delay. Duke's statement was accompanied by brief statements by John Vorhaus (Duke's co-commentator on Ultimate Bet tournament broadcasts) and Joanne Primm (UB Pro Relations Manager and tournament broadcast organizer) who corroborate key points of Duke's statement. Again, we have no independent evidence to corroborate or debunk Duke's claims, but Duke certainly deserves the benefit of the doubt when her accuser is an admitted thief, liar, and scam artist like Russ Hamilton.

* * * * *

A more troubling issue for Annie Duke does arise from the recent Ultimate Bet recordings. It is unquestionable that Ultimate Bet management was looking to cover up the scandal as quickly and quietly as possible, and with the least cost. The problem is, this crisis management strategy required Ultimate Bet's management not only to lie to its customers, but also to attempt to find a way to minimize the amount it refunded to those of its customers who were victims of the cheating scam. Enter Annie Duke, Ultimate Bet sponsored pro and public spokesperson.

Following the scandal, and mere months after Ultimate Bet executives were conspiring with Russ Hamilton to control the public narrative and minimize their financial exposure, Annie Duke gave an interview in which she asserted that "new management" had handled the situation fairly:

"Everybody's horrified that it happened - including me. I just want to get that out of the way. There are no excuses for what happened. It's ugly, it's ridiculous and it's incredibly upsetting. With that being said, I think there's a large portion of people out there who got their money back which I think is amazing. I had one player call me up who's an old time player playing for a really long time and who said to me, "Annie in all the years that I've been playing and all the times that I've been cheated this is the first time I've ever gotten my money back." I think that there's recognizing there are things that have happened. This was not the site cheating anybody, this was individuals cheating people. It's really horrible that it happened but the site did good by it and made sure that everybody go their money back and let's move on because the site is secure."

~Annie Duke, Dec. 25, 2008 in a Gambling 911 interview

Also, as you may recall, back in July 2010, Duke testified before Congress on behalf of the Poker Players' Alliance (PPA) in support of the then-pending online poker bill (HR2267) sponsored by then-Representative Barney Frank. Duke's written testimony, which she also read into the record, whitewashed the scandal, asserting that the "God mode" cheating scam was the work of one person (Russ Hamilton), and that "new management" had refunded all stolen money to the victims of the scam:

"For me, the most critical component of regulation is player protections. As some of you know, I play at a site called Ultimate Bet. Under previous management, an associate of the website developed a breach in the software that allowed for players to be cheated out of a great deal of money. I agreed to continue to endorse the site only after I was sure that new management had addressed the problems, took voluntary steps to refund the cheated players and ensured tighter control over their site security. Nonetheless, an important benefit of regulation would be to ensure, through source code-based testing and outcome-based testing, that the games are fair and those players cannot be defrauded by the sites and that players cannot cheat others at the table. Further, under a U.S. regulated system players would have legal recourse should they feel they are harmed and regulators would be able to penalize licensed companies that breach the regulatory standards. Today, the best non-U.S. licensing regimes already do this, but, U.S. players deserve the protections and assurances of their own government."

In response to follow up questions from the committee members, Annie Duke repeated her claim that UltimateBet's new management had fully refunded the players who were victims of the "God mode" cheating scam. Below is video and a transcript of Annie Duke's sworn testimony in response to a question from Rep. Bachus (Rep. Bachus's question begins at the 3:23 mark, with Annie Duke's response beginning around the 3:51 mark):

“I’m affiliated with UltimateBet.net, which is a free play site. But they do offer games on .com, yes. … It was $22 million. The site self-regulated and refunded all the money to its customers. I would prefer to have something like HR2267 [the Barney Frank online poker bill] so that the government could oversee that regulation. I think that the customers of that site were lucky that they were playing on a site under new management that behaved in an honest way and refunded them. But the individual—and it was one individual—that perpetrated the crime and breached the software has not been prosecuted because, unfortunately, there is no jurisdiction to do so.”

Based on the recent Ultimate Bet recordings, it seems safe to say that Ultimate Bet's management neither "self-regulated" nor "behaved in an honest way". Simply listening to the ten-minute segment of one of the meetings shows Ultimate Bet management conspiring to concoct a plausible cover story, complete with Travis Makar and/or an unnamed rogue former employee as a possible fall guy, to sell to the KGC and the public. They even had the chutzpah to suggest perhaps Russ Hamilton himself should be painted as a victim of the scam. Further, rather than attempting to determine and repay actual losses for all cheating victims (which probably exceed the $22 million paid and are effectively impossible to calculate), Ultimate Bet management was intent on refunding as little money as possible, including asking the primary figure in the scam to think of ways to convince victims to waive their claims. Based on John Mehaffey's summary of other parts of the recordings, Ultimate Bet's management clearly was focused on minimizing its liability, even if doing so came at the expense of the victims.

If Annie Duke was unaware of the scope and nature of the cheating scam and Ultimate Bet management's response to it, then she quite likely believed that new management was cleaning house and taking care of the victims. But—and this is a critical caveat—it is extremely troubling that Duke's testimony emphasizes Ultimate Bet's "rogue operator" story, pinning all the blame on Russ Hamilton acting alone when Ultimate Bet's management had worked with Hamilton to concoct that precise official cover story. It's also quite rich for Duke to bemoan the fact Hamilton would never be prosecuted, considering Ultimate Bet executives had tried (unsuccessfully) to work with Hamilton to concoct a story that would let him avoid taking responsibility with the KGC. Perhaps Duke was naive and Ultimate Bet's management convinced Duke their official story was correct. Perhaps Duke was suspicious but didn't want to bite the hand that fed her. Perhaps Duke knew the story wasn't entirely accurate, but viewed it as public relations spin. Without more evidence, we simply cannot draw any conclusions.

Regardless of what Annie knew and when, she certainly earned her keep as an official Ultimate Bet shill. Ultimate Bet not only weathered the scandal, it was strong enough financially to merge with Absolute Poker into the Cereus network, which was then sold to Blanca Games in August 2010, probably putting some money in the pockets of the executives who saw nothing wrong with working with Russ Hamilton to minimize the recovery for Hamilton's victims. Duke stayed on board with Ultimate Bet until she jumped ship in December 2010, just a few months ahead of the demise and liquidation of the company in the wake of Black Friday. Annie Duke's loyalty to Ultimate Bet and her excellent sense of timing make her one of only a few poker pros—along with Phil Hellmuth and Russ Hamilton—who can say they made big money at Ultimate Bet.

Poker's Watergate Moment

2013-05-11T11:55:00.000-05:00

"I did take this money and I'm not trying to make it right, Dan, so we gotta get that out of the way right away, real quick."

~Russ Hamilton to then Ultimate Bet legal counsel Dan Friedberg, Early 2008

Last night, Travis Makar, a former associate of disgraced poker pro Russ Hamilton, released a large number of files related to the Ultimate Bet cheating scandal. Over the past five years, significant information has come to light regarding the scandal, much of it involving internal Ultimate Bet records, emails, and other documents. That evidence—much of which was analyzed extensively by Haley Hintze, Nat Arem, and other dedicated folks in the poker community—painted a compelling story that Hamilton and likely others at Ultimate Bet had used a software program that permitted a player to see his opponent's hole cards in real time, allowing them to play perfectly. This so-called "God mode program" was used to steal more than $22 million from high-stakes Ultimate Bet players, though the actual amount stolen was almost certainly north of that admitted amount.

Until last night, despite the official determination by regulators that Russ Hamilton was the primary figure in the cheating scandal, the evidence available actually suggested that the scandal was wider than just Hamilton, that other high-level executives and big-name players at Ultimate Bet had known of the "God mode" cheating and profited from it, either using the program directly or profiting indirectly from collusion, chip dumping, or assisting in hiding the money trail. But all of that evidence was circumstantial, allowing a surprising number of suckers and apologists in the poker community to maintain that the scandal couldn't possibly have infected the management of Ultimate Bet. After all, why would an online poker site that could generate millions of dollars in rake take the risk of cheating and stealing from its own customers?

Ladies and gentlemen of the jury, I present to you Prosecution Exhibit A, a ten-minute portion of a three-hour audio recording of a meeting between Russ Hamilton and several Ultimate Bet executives. This meeting occurred during early 2008,* after the original hand histories had been released and the cheating detected by the poker community. The point of the meeting is to concoct a damage control strategy.

John Mehaffey at LegalPokerSites has prepared an excellent detailed summary of key points from the full three-hour meeting. Some notable moments in this ten-minute part of the meeting include:

Beginning: Immediate discussion of fact that information about the God Mode account has gone public, and the need to create plausible (but apparently false) story to explain and minimize the cheating.
2:55—Russ Hamilton: "Annie Duke used it [God mode software] on a 15 minute delay quite a few times."
3:10—UB Executive asks Russ to identify cheated pros who he could "explain it away" to prevent a claim being made.
4:00—Discussion of limiting exposure to $5 million, including any fine to the Kahnawake Gaming Commission (KGC).
5:07—Russ Hamilton: "I did take this money and I'm not trying to make it right, Dan [Freidberg, Ultimate Bet legal counsel], so we gotta get that out of the way right away, real quick."
6:30—Russ Hamilton claims he spread his ill-gotten gains to high stakes players: "Freddy Deeb got the most cash." (NOTE: This is not to say those who got money knew about the cheating. This might have been staking, or a method of indirect cashing out to hide the cheating paper trail.)
8:20—Russ Hamilton justifies his fraud by claiming he used it to pump up UB: "I spent a lot of this money on [UB promotions]."
8:30 to end—UB exec suggests some of Russ Hamilton's cheating was "sanctioned" by management to help UB survive a financially difficult period.
9:00 to end—UB exec suggest shifting blame/liability for fraud to Excapsa is "my current goal".

In a courtroom, a standard instruction judges give to juries is that direct and circumstantial evidence can be given equal weight. But as a trial attorney, I know better. Direct evidence like an audio or video recording of the people involved in a crime is pure gold. Nothing beats an admission straight from a criminal's or witness's own mouth.

Ever since the original Watergate scandal back in the mid-1970s, the media attempts to analogize every new political scandal back to Watergate. But with the release of this new Ultimate Bet audio recording, the analogy is rather apt. In Watergate, the initial crime—a break-in at the Democratic Party headquarters—was a plot involving only a few key Nixon campaign staffers. But once the break-in was discovered, the cover-up efforts spread to more senior White House staffers, and eventually to the President himself. Initially, the investigation involved statements and testimony from individuals with circumstantial knowledge of key events, and a variety of circumstantial documents laying out a "money trail". White House staff denied or disputed all allegations of misconduct, and delayed or obstructed the investigation at every turn. But the scandal escalated when it was discovered that audio tapes of White House meeting existed. Once those tapes were released, there could be no further plausible deniability of the involvement of many senior White House staffers, as well as the President himself.

Just like in Watergate, the release of this Ultimate Bet audio recording (and another recording from a few months later) is a game-changer. It is no longer possible for the apologists to defend Russ Hamilton or any of Ultimate Bet's senior management who were at this meeting, or who are implicated by this recording. It is now crystal clear that Ultimate Bet's management was facing a financial crisis in the wake of the scandal, and thus never had any interest in coming clean about the scandal or in identifying and repaying customers who had been cheated. Instead, the entire focus of management was to perform public relations damage control and to minimize exposure for fines or customer claims. If that meant fabricating stories, shifting blame, or outright denial, so be it.

Of course, this scandal is now more than five years old. Ultimate Bet doesn't even exist anymore, a victim of Black Friday and shady player account practices. Much of this new evidence will simply confirm what has already been pieced together from other sources. It is unlikely that any criminal charges will ever be brought against Hamilton or the Ultimate Bet executives complicit in the cheating or the cover-up. Regrettably, this new evidence probably has surfaced far too late to assist any of the cheating scandal victims in recovering their money. But having an accurate historical record of the details of the cheating and the cover-up may well be useful in helping iGaming regulators detect and prevent future cheating. And, to the extent any of the involved individuals remain part of the gaming industry, they can and should be asked to explain themselves to gaming regulators. Frankly, given this audio recording, Hamilton and the others at the meeting should be permanently barred from the gaming industry, and attorney Daniel Friedberg should also be disbarred anywhere he is licensed to practice law.

Unfortunately, this new evidence may well have one additional Watergate-esque effect: staining the online poker industry's reputation. Certainly the Absolute Poker and Ultimate Bet superuser scandals have been common knowledge within the poker community. In fact, these scandals were the subject of a 60 Minutes report discussing the "Wild West" of cheating on poorly regulated online poker sites. But the new Ultimate Bet audio recording adds a piece of the puzzle that makes the scandal more real to those folks who are potential casual poker players who haven't paid much attention to the scandals to date (or might even be too young to have heard of them). Certainly these new revelations come at an awkward moment in online poker legalization efforts, as legislatures wrestle with a variety of customer protection concerns. Ultimately, this new information probably won't prevent online poker legalization by itself, but it will give poker opponents fresh ammunition. But, if this new information leads to tougher online poker regulations and stricter security oversight, then poker players will be better for having this sordid mess finally put to rest.

Sunlight truly is the best disinfectant.

-------------------------------------------------------------------
* UPDATE (5/12/2013; 3:45 PM CDT): The original version of this post incorrectly placed the audio recording in "late 2008" based on other writers' ambiguous references to "Winter 2008". However, given the discussion in the recording of creating a cover story that did not implicate Russ Hamilton and discussions as to the ongoing internal investigation into the accounts used in the "AuditMonster" cheating scheme, the timing of the meeting in the recording must have been sometime after the cheating was discovered in January or early February of 2008, and certainly before the preliminary KGC report of September 29, 2008 which identified Russ Hamilton as the primary (or sole) cheater. Further, the Ultimate Bet internal investigation report was provided to the KGC in late July, 2008, so discussion of the official story to provide to the KGC would have occurred prior to that report.

-------------------------------------------------------------------
In the days ahead, follow Haley Hintze (Twitter, blog, and FlushDraw.com), TwoPlusTwo, Chris Grove, and Kevmath for updated information on the scandal, along with the usual excellent poker news sites like FlushDraw, LegalPokerSites, OnlinePokerReport, and PokerFuse.

Why I Race—A Runner Responds to The Boston Marathon Tragedy

2013-04-15T23:57:00.001-05:00

Today's tragic news of the bombing of the finish line of the Boston Marathon hit me hard. Obviously all Americans are stunned and saddened by yet another terrorist attack at home (even if we don't know right now who perpetrated this atrocity or why). But this attack was like a sucker punch to my psyche because I am a runner, and the Boston Marathon is the quintessential road race, the ultimate running challenge for which merely qualifying to participate is a badge of honor.

The Boston Marathon is not just the ultimate road race, it is also the ultimate expression of the paradox of running. Running is inherently an individual pursuit, a solo sport. Runners generally train alone, spending hours with nothing but their thoughts as they trip off miles in the early morning or twilight hours. Running provides personal records (PRs) as a goal, rather than the team victories offered by softball or basketball leagues. Runners finish their workouts with Powerade and yogurt, while golfers finish their rounds with beers and cigars.

I run for a lot of reasons. I run for my health. I run to stay fit. I run to relax. I run to get lost in my thoughts. I run to enjoy the weather and the great outdoors. I run to exercise and bond with my happy and manic dog.

Yet while running is a lone wolf pursuit, racing is a gathering of the wolf pack. There is nothing quite like the experience of a road race, joining together with hundreds or thousands of fellow runners and even greater numbers of volunteers and spectators to run, still as an individual, but also as a member of a community that shares your love of running.

Over the better part of two decades, I have run dozens of road races for a myriad of reasons. In my youth, I was competitive and raced to beat my friends, to compete in my age class, and to set PRs. More recently, after several years away from road races, I was lured back by the opportunity to share an experience with friends, and an excuse to visit places I had never seen. And in the past year, I have come to appreciate a rather spiritual element of racing, where pushing yourself as an individual can lead to a special bonding with friends.

In the wake of the Boston tragedy today, I have no special insights to offer, no easy solutions to sell, no political position to push. My gut is twisted in knots by news of dead and injured children, by photos of maimed and bleeding runners and spectators. To many Americans, today's events may be just another attack by terrorists or a delusional sociopath. But today's bombings hit me hard; even though I don't know any of the victims, I feel as if I knew them because of the special bond between runners and those who support them at road races. Those hurt by the bombs in Boston were the family and friends of some of us runners, which makes them the family and friends of all of us runners everywhere. The only way I know how to explain this feeling is to explain why I race.

* * * * *

I race for my friends who are on the verge of qualifying for Boston.
I race for my friends for whom just crossing the finish line is a victory.
I race for the young girl with the rainbow covered sign that says, "Go Mom! Run Fast! I Love You!"
I race for the little boy in his favorite athletic jersey high-fiving strangers while he waits to see his Daddy run past.
I race for the old couple holding hands in their lawn chairs as we zip past their home.
I race for neighborhood groups schlepping Gatorade and raking up cups.
I race for the ladies with the funny signs that say, "Run like a bear is chasing you!" or "Those shorts make your ass look fast."
I race for the local bands covering classic rock songs at every mile marker.
I race for the amateur DJ spinning tunes out of a minivan parked at the bottom of the Big Hill.
I race for the spectators cheering for hours for complete strangers, even the slow, balding, and pudgy old guys like me.
I race for the gals in the rainbow tutus, the dude in the banana suit, and all the running Elvises.
I race for the high school kids, the mothers pushing strollers, and the old men who all pass me in the last three miles.
I race for my boyfriend and dog who magically appear every couple of miles to yell or bark my name.
I race for my friends who sit for ages just to pop up and pace me for encouragement after a rough hill.
I race for that last half mile kick past cheering throngs of people who don't know me but want me to finish strong.
I race for the folks who hand out the medals, the water, the yogurt, and the beer in recognition of a successful run.
I race for the police officers who take a day off to direct traffic, and for the EMTs and doctors in the volunteer medical tents.
I race for my friends at the finish line who high five me and buy me pancakes and beer despite my being a sweaty mess.
I race because runners aren't meant to run alone.
I race because I'm part of the pack.

* * * * *

I'm registered to run half-marathons the next two weekends at the Marion Rotary Marathon for Shoes and at the Drake Relays / Hy-Vee Road Races. As planned, I'll be running to enjoy Iowa's spring weather, to compete against myself and the field, and to celebrate an accomplishment with my friends.

After today, I'll also be running in honor of those innocents who died or were injured in the Boston attacks. I don't believe in any simplistic "Run or the terrorists win" pablum. I just feel that the best way to honor today's victims—and heroes—is to keep the Great Race alive. To high five cheering kids. To do a little dance when a DJ pumps up the volume along the course. To give a thumbs up to random spectators with a funny sign or a local band belting out an upbeat tune. To spare a breath for a "Thank you, sir/ma'am" for the police officer holding traffic at a crossroad. To respond to neighborhood volunteers' calls of "Gatorade!" or "Water!" with a sincere "Bud Light?!?"

To simply keep the pack together to race another day.

Don't Kill the Refs

2013-03-24T17:26:00.001-05:00

"If I show up at your door, chances are you did something to bring me there."

~Assassin for hire Martin Blank (John Cusack), in Grosse Point Blank (1997)

Several close games in this year's opening rounds of the NCAA basketball tourney have resurrected that time-honored wail from the fans of losing teams: "The refs screwed us." Usually the fans' ire is directed at a close call or no-call in the final minute of a tight game, particularly one that looks questionable or even flat out wrong in slow motion replay. But for that one bad call, fans contend, their team would have won the game.

The whining du jour comes compliments of Iowa State fans, who saw their 10th seeded Cyclones battle back against the 2nd seeded Ohio St. Buckeyes in a West Regional game, only to lose to a buzzer beating three-pointer. Cyclone fans (including many of my fellow Ironmen) are incensed over an offensive charging call against a Cyclone player with roughly a minute left in the game. Replays showed that the Ohio State defender should have been called for a blocking foul, and the Cyclones awarded the basket and a free throw with a chance to take a three or four point lead into the final minute. Many Cyclone fans are now crying into their beer about how "the refs cost us that game".

The problem with this mentality is that focusing on one call in isolation just because it happens in the last minute of the game ignores the first 39 minutes of the game. Although the call feels critical because the game is close to an end, the same call at any point in the game would have had the same impact—a three point swing in favor of Ohio State. Of course, Ohio State fans probably can point to a handful of calls earlier in the game that they disagreed with, calls which created the same or greater swing in favor of Iowa State (and truthfully, "bad" calls and no-calls tend to even out over the course of a full game). Further, events earlier in the game could have put Iowa State or Ohio State comfortably ahead, rendering any call in the final minute largely irrelevant to the outcome. Finally, focusing on that one call ignores the succeeding nearly full minute of play, during which: a) Ohio State missed the front end of a one-and-one followed by an immediate Iowa State rebound and turnover with the score still tied with 58 seconds left, b) Iowa State failed to secure a defensive rebound with 33 seconds remaining, and c) Iowa State failed to defend Ohio State's winning shot (though it was still a tough, clutch shot by Aaron Craft). [FN1].

If a team is in a position to lose a game because of a questionable or bad call in the final minute, chances are that team did something wrong in the first 39 minutes that put them in that position. The team may have taken poor shots, missed free throws, committed turnovers, failed to rebound effectively, or played poor defense. The coach may have failed to adjust his offensive or defensive sets to take advantage of the opponent's weaknesses, or failed to adjust his lineup to create the most favorable player matchups. A star player may have tried to force the action rather than running the offense, or committed a silly foul forcing the coach to bench him for a critical part of the game. A team playing its best basketball should rarely be in a close game in the closing minutes of a game. [FN2].

Referees obviously impact a game. But referees rarely "decide" a game, and when they do, it's usually because the style of game they call (loose or tight on fouls) favors one team or the other, not because they booted an isolated call or two. So although it's tempting to blame the refs for "losing" a game for your team because of one or two bad calls, odds are strong your team has only itself to blame.

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[FN1]. In the interest of full disclosure, I refereed basketball at high school varsity level down to grade school games for roughly 18 years, including training and supervising college intramural referees during law school. In fact, back in the day, I wrote an op-ed in the college newspaper similar to this post. So I admittedly have a "pro-referee" bias.

[FN2]. In today's game, shooting from the field, free throws, and personal fouls were all essentially even between the teams. However, Iowa State committed 16 turnovers to Ohio State's 7, which probably had a much greater impact on the ultimate outcome than did the late block-charge call.

Dear Fathers: What If Your Son Is Gay?

2013-03-17T21:26:00.000-05:00

Kurt's Dad: My son's a homosexual, and I love him. I love my dead gay son.

J.D.: Wonder how he'd react if his son had a limp wrist with a pulse.

~Heathers (1988)

Friday, conservative Republican Senator Rob Portman published a shocking article coming out in favor of marriage equality for gays after years spent toeing the GOP anti-gay party line:

Two years ago, my son Will, then a college freshman, told my wife, Jane, and me that he is gay. He said he’d known for some time, and that his sexual orientation wasn’t something he chose; it was simply a part of who he is. Jane and I were proud of him for his honesty and courage. We were surprised to learn he is gay but knew he was still the same person he’d always been. The only difference was that now we had a more complete picture of the son we love.

At the time, my position on marriage for same-sex couples was rooted in my faith tradition that marriage is a sacred bond between a man and a woman. Knowing that my son is gay prompted me to consider the issue from another perspective: that of a dad who wants all three of his kids to lead happy, meaningful lives with the people they love, a blessing Jane and I have shared for 26 years.

I wrestled with how to reconcile my Christian faith with my desire for Will to have the same opportunities to pursue happiness and fulfillment as his brother and sister. Ultimately, it came down to the Bible’s overarching themes of love and compassion and my belief that we are all children of God.

Senator Portman's article drew plenty of criticism from fellow conservatives, hardly surprising given the influence of the religious right over Republican politics. More surprising—and disappointing—was sniping from many pundits on the political left who called Portman's change of heart a "confession of moral failure" or evidence of "a fundamental lack of compassion", causing "disgust" at Portman's lack of empathy and accusations of a "politics of narcissism".

All of the critics need to pipe down. There is no question marriage equality is a hot-button political issue, and a sitting U.S. Senator breaking with his party's position on the issue undoubtedly has political implications. Yet I view Senator Portman's announcement as more of a personal and family matter, made public only because he is a fairly high-profile politician. Seeing the Senator and his wife publicly declare how proud they are of their son Will, how they love him as he is, not as they might have wanted him to be, and how they wish for their son to have the opportunity to be just as happy as they and their other children, only drives home for me how difficult the situation must have been for the entire family. Imagine being Will Portman, the gay son of a prominent politician whose party is anti-gay (often rabidly so), in a state where an anti-gay marriage amendment was cynically placed on the ballot in 2004 in a transparent effort to bring Republican voters to the presidential polls, whose father was even mentioned as a leading Vice Presidential candidate for an avowedly anti-gay Mitt Romney. Imagine the fear and anxiety that Will must have felt as he tried to work up the courage to tell his parents he was gay. Imagine Will's relief when his parents accepted him with love. Imagine Will's pride when his parents not merely accepted him, but went so far as to publicly advocate for his right to marry some day, in direct contravention of what would be politically expedient for his father. To me, Senator Portman's article was not a political statement, but a public declaration of love and support from a father to his son. I have nothing but admiration for how the entire Portman family has handled this situation.

Senator Portman's article was a strange counterpoint to another note making the rounds on the internet this week, a note in which a father told his gay son there was no reason to worry about coming out:

I overheard your phone conversation with Mike last night about your plans to come out to me. The only thing I need you to plan is to bring home OJ and bread after class. We are out, like you now. I’ve known you were gay since you were six, I’ve loved you since you were born.

—Dad

P.S. Your mom and I think you and Mike make a cute couple.

This note was pretty much the opposite of my personal experience. When I came out, my friends were overwhelmingly supportive. My mother, however ... well, she returned my Christmas letter unopened, with a post-it note attached stating:

We have no desire to know anything about the lifestyle you have chosen. Your letter will just upset us, so I am returning it.

~Mom & Dad

Now, my parents and I eventually worked through the issue, and our relationship is stronger than ever. But my experience, and the experience of the Portmans, is a reminder to fathers of young sons everywhere—your own son might well be gay. Of course, the odds are overwhelming your son will be straight—he only has roughly a 1-in-20 chance of being gay. Still, considering around 5% of kids will turn out to be gay, you will almost certainly be confronted with the issue of a gay teen at some point in your life. If it's not your son, it will be the son of a friend, or one of your son's friends. So, how will you handle the issue of your son growing up gay, or his growing up with a gay friend?

If your son is interested in sports, will you steer him toward football, basketball, hockey, wrestling, or baseball because they are more "manly"? If you coach a youth sports team, will you tell your team they are playing like "fags" or "pussies"? Will you tolerate a coach or fellow parent who uses anti-gay language? Will you stand by and let the more talented or popular kids on the team use words like "gay" or worse to taunt their opponents or even their own teammates?

What if your son excels in a sport like swimming, diving, gymnastics, ice skating, or volleyball; will you be embarrassed to attend his meets? Will you be openly disappointed if your son doesn't want to watch sports or go hunting or snowmobiling or hiking with you? Or what if your son wants to participate in drama, show choir, band, dance, or art? Will you attend every show? Take him to rehearsals? Brag to your friends about his awards? Or will you tell your son that he should stick to sports? Avoid his shows with forced excuses? Hide your discomfort from your friends with uneasy jokes?

When your friend confides over a beer that his son is gay, will you silently give thanks that your son is straight? When you learn for certain your son is straight, will you breathe a sigh of relief?

Knowing that gay teens are at substantially higher risk for depression and anxiety, being bullied or assaulted, abusing alcohol or drugs, dropping out of school or having educational problems, and attempting / committing suicide, will you be the strong father, coach, or role model who is someone a gay teen can turn to for support?

If you learn your son is gay, will you love him just the same? Will your son know this even before you tell him?

Frankly, though, if it turns out your son is gay, there are only two questions that really matter:

Will you be proud of your son?

Will your son be proud of you?

Especially proud of my dad today

http://www.dispatch.com/content/stories/editorials/2013/03/15/gay-couples-also-deserve-chance-to-get-married.html …

~Will Portman, @wdportman, 6:34 AM; 15 Mar 2013

Did the PPA "Lobby" for SunFirst Bank?

2013-02-28T13:12:00.001-06:00

Haley Hintze is well-known in the poker community for her diligent, even obsessive, investigation into the Absolute Poker and Ulitmate Bet superuser scandals. Since Black Friday, Hintze has turned her sights on the Full Tilt Poker collapse, generating quite a number of informative articles and often digging up fascinating nuggets of backstory to fill in some of the blanks in the public Black Friday narrative.

Hintze today published a four-part story, "PPA Linked to Full Tilt / PokerStars SunFirst Bank Lobbying Effort" which uses emails generated in the SunFirst Bank investigation to fill in some gaps in the events that led up to Black Friday. Her full piece is worth a read by anyone interested in the state of poker lobbying efforts in the months leading up to both the Reid-Kyl bill and Black Friday.

There is a lot of information packed in the Hintze piece which is worth some reflection and comment once I return from vacation. However, I did want to address one point raised by Hintze:

Whether the lobbying effort grew out of SunFirst’s own desire for legal confirmation or whether it was the sensing of an opportunity by lawyers for Stars and Tilt remains unexplained, as does the mechanism of how John Pappas and the PPA became involved in lobbying on SunFirst’s behalf, to benefit Stars and Tilt. The lobbying effort appears to have begun in conjunction with Full Tilt joining the SunFirst operation, but the failure to procure a beneficial legal opinion from the Utah AG’s office did not cause Full Tilt to back out of the arrangement.

As part of my job, I work with a variety of industry groups on legislative and administrative rule proposals. What I do is not "lobbying" per se. [FN1]. My role is more in background support, typically drafting proposed bills or rules, then handing them off to lobbyists who get them submitted. I then provide comments on proposed amendments, and on occasion testify before committees or meet with legislators who have questions about the bill. In drafting bills or rules, I nearly always am coordinating with multiple interest groups; sometimes it's a gathering of the usual suspects for your industry, sometimes you find your group aligned with a mortal enemy group on an issue, and sometimes it's a kumbaya "for the good of everyone" compromise proposal hashed out in advance of submission.

Turning back to the SunFirst / PPA situation, I think it is important to be careful in describing what the PPA's role was in "lobbying" the Utah Attorney General for an opinion that online poker was not illegal, so processing payments was likewise not illegal. First, there is nothing improper about requesting an AG opinion on an issue, even one related to your own business. In fact, AG opinions (or similar processes, like advisory opinions or declaratory orders before certain agencies) are an important tool for businesses looking to clear up legal grey areas in advance of taking the risk of violating an unclear statute or rule.

Next, there is nothing inherently improper about the PPA assisting SunFirst (or any other poker industry business) in obtaining an AG opinion that online poker is legal, or that processing online poker payments is legal. It appears from the emails cited by Hintze that the PPA was advancing its usual arguments that poker is a game of skill, and that online poker was not illegal under state or federal laws as they existed post-UIGEA. Now the mere fact that the PPA's argument--which it had robustly developed by that point--supports SunFirst's business interests in processing online poker payments does not mean that the PPA was "lobbying for" SunFirst. Rather, the PPA was lobbying for online poker, and that argument was of benefit to SunFirst.

Finally, and perhaps most importantly, the mere fact the PPA coordinated its lobbying efforts with SunFirst does not mean there were any shady dealings between the two, or that the PPA was aware of the alleged bribes by SunFirst executive Jeremy Johnson (and Hintze explicitly disavows drawing the latter conclusion). The emails cited by Hintze certainly demonstrate coordination between SunFirst, the PPA, and their respective attorneys. But in lobbying efforts of this kind, such coordination is common--routine, in fact. It makes sense to divide the lobbying work based on the interests and expertise of the coordinating groups. Here, letting the PPA take the lead on the issue of the legality of online poker would make sense, given their expertise in developing those legal arguments. Further, submitting draft bills, rules, or, in this case, opinion letters, is also routine; no legislator or official wants to start from a blank slate, and those most interested in the issue will generally draft a proposal that suits their needs as a starting point for discussion. So the PPA's submission of materials to the AG in support of online poker in general, and in support of SunFirst's request for an opinion on the legality of payment processing specifically, is actually quite consistent with the activities of most issue advocacy groups.

The interesting issue raised by the emails reported by Hintze is whether the PPA had any deeper connection to SunFirst, Jeremy Johnson, or Chad Elie. The connections between PokerStars, Full Tilt, and the PPA have long raised questions in the minds of some poker players about whether the PPA is truly an independent advocacy group, or instead is a stalking horse for the online poker sites who provide most of the PPA's money. Hintze's article explores this issue in light of the new SunFirst emails, and the connections and timeline of events Hintze draws are quite intriguing (and something I will certainly re-read once I get back from vacation). Hopefully Hintze or others in the poker community can use these emails to shake loose more documents that can help fill in the remaining gaps in this backstory.

------------------------------------------------------------

[FN1]. "Lobbying" carries a technical, legal definition of paid advocacy that is much narrower than the more generic use of that term. I will use "lobbying" in that broader sense of advocacy for a position by a group with an interest in a particular issue or industry.

- Posted using BlogPress from my iPad

IMOP VII: The Honey Badger Craps Out

2013-02-22T22:45:00.002-06:00

"Wine loved I deeply, dice dearly."

~Edgar, in King Lear, by William Shakespeare

As "Winter Storm Q" sweeps across the Midwest, the thoughts of the Ironmen of Poker turn to the bright lights of Vegas, with dreams of poker tables, casino pits, sports books, and alcoholic beverages dancing in their graying and balding heads. Next weekend will bring the Ironmen back to Poker Mecca to celebrate the high holy days of IMOP VIII—Revenge of the Nerds. D-bags beware! Hijinks will ensue!

"But wait!" cry the loyal followers of the Ironmen. "Whatever happened on IMOP VII—There Will Be Blood? Who won the Jacket Dinner? Who tilted Euro D-Bags while stacking mountains of chips? Who pulled the best "Ta Da"? Did the Honey Badger give a sh*t? Where's the freakin' trip report?"

You know that "What Happens Here, Stays Here" ad campaign for Vegas? Well, here's the dark truth behind all those wild tales of Vegas fun. The Vegas Strip is the high altar for the Gods of Degeneracy. Most who worship there leave happy, if hungover and poorer. But the dark gods demand the occasional sacrifice to maintain cosmic balance. For six IMOP expeditions, the Ironmen left Vegas as winners. Last March, instead of celebrating IMOP-VII, the entire Ironman crew sevened out.

Frankly, the Vegas admen have it all wrong. The happy stories of cashing sports investments, tossing back beverages, and tilting d-bags at the poker table are meant to be remembered and shared. It's the trips where the only stories are of parlays getting hooked, dealers drawing 5s on 16s against double downs, and monsterpottens getting shipped to d-bags hitting perfect-perfect that should be shrouded in a cone of silence. So it is, and so it shall be for IMOP-VII, henceforth known as the Dark Age.

Consequently, there will be no official trip report filed for IMOP-VII, no official record made of the hijinks and hilarity, the pranks and putdowns, the booze and bonding, that mark a successful Ironman outing. However, for the benefit of future poker archaeologists, here are some unfinished notes found on scraps of napkins buried deep in my iPhone notes app.

Returning Vets (Rookie Year): Santa (I), Lucky (I), JebeDIA (II), Grange (II), Barbie (III), Bonnie (III), Colt (V), River Joe (V), Fat Jesus (V), Mr. Chow (V)

Rookies: Fun Bobby, Texas Ollie, Beavis (IMOP-TX chapter), Butthead (IMOP-TX chapter)

Tournament I: Stratosphere. In hindsight, having the official kickoff toast in the bar at the top of the Stratosphere while watching people intentionally jump over the side "for fun" may not have set the right tone for the trip.

Tournament II: Tropicana, with "Silly Shades" contest. Apparently the Honey Badger JuJu jinxed the poker room, causing it to close shortly thereafter.

Colt rocks the crazy shades at Tropicana.

Tournament III: Mirage, with "White Trash (wife beaters and tattoos)" contest. Not sure why, but the Mirage poker room has yet to call security on the Ironmen. Maybe this year. It's good to have goals.

The white trash crew at Mirage.

River Joe says, "Ta Da!"

Lucky. Duh.

The Debil.

Third World Poker Tour: Rooms on the Tour included Mandalay Bay, Luxor, Excalibur, Monte Carlo and ... Flamingo? Imperial Palace? Bellagio? Sure. Why not? If they weren't the actual sites, they should have been. Plus, good luck proving otherwise.

Jebedia gets some culture.

Tournament IV: Aria. Awesome room. Awesome tourney. Too awesome for the Ironmen who left steaming piles of poker dookie all over the room. Which may be why we can't have nice things.

Jacket Dinner: Stack at Mirage. Where do you think all the dookie came from? For lack of memory of actual results, and because history is an artificial construct created by the victors to establish a credible social narrative supporting their usurpation of power, the official Jacket Champion was Santa, with Lucky as First Loser.

Lucky looking suave.

Santa makes a statement:

"Even hookers won't hit on me tonight."

Champion: None. Had any Ironman so much as walked away from Vegas up a solitary credit on penny slots, he would have won the IMOP-VII Championship in a rout. For those of you keeping score at home, rumor has it that the ironically named rookie Fun Bobby won as Leastest Loser.

As two-time defending IMOP Champ Barbie might

have said if he wasn't busy 4-balling blackjack on credit

with a homeless guy by the Bally's pedestrian bridge:

"Sometimes, the only answer is another drink."

The WSOP Ladies Event "Discount" Blunder

2013-02-15T16:17:00.001-06:00

“The essence of strategy is choosing what not to do.”

~Harvard Business School Professor Michael E. Porter

Yesterday, the 2013 World Series of Poker schedule was announced. Most of the immediate reaction was focused on Event 51, the long traditional and recently controversial "Ladies Event". It's become one of poker's most hallowed rituals—a chorus of complaints that the Ladies Event is unfair discrimination against men and condescending to women, followed by a responsive chorus of defenses of the Ladies Event as a time-honored WSOP tradition that is a fun and entertaining event for women who would not otherwise play big buy-in tournament poker. Unfortunately, this ritual debate has devolved into zombie arguments, beaten to death, resurrected, and beaten to death again, lying in shallow graves waiting for the first full moon after the summer solstice for the magic incantation of "Ladies, shuffle up and deal!" to call them forth. [FN1].

I have long maintained that all the bickering about the Ladies Event just results in a lot of unhappiness being spread around the poker world. Men are unhappy they can't play the supposedly weaker competition in the Ladies Event, at least without WSOP officials hassling them. WSOP officials are unhappy that men are ruining the fun of their Ladies Event, so they feel compelled to get medieval on the spoilsports. Women are unhappy that men are ruining their day in the sun by playing in their event, unless, of course, they are unhappy that men aren't allowed to play in their event.

This year, even though we are four months out from the start of the Ladies Event, the old arguments got a new twist. As Shamus observed over at Hard-Boiled Poker, WSOP officials gave the ladies a Valentine of sorts this year, making the Ladies Event officially a $10K buy-in tournament, but giving all women a $9K "discount" on their entry fees. Or, from the other point of view, WSOP officials went up to all the male players considering entering the Ladies Event, looked them dead in their Blue Shark sunglasses, flipped them the bird, then spit on their baller shoes.

Of course, the "ladies' discount" is really just a cynical ploy by the WSOP to find some way to keep out those pesky, uncouth men who have been crashing the ladies' poker party the past few years. Openly banning men from the Ladies Event is illegal under anti-discrimination laws, while strong-arm tactics like threats of player suspensions have been ineffective (and probably illegal if implemented). But the "ladies' discount" gambit is an interesting ploy. Nevada law expressly allows "differential pricing, discounted pricing or special offers based on sex to promote or market the place of public accommodation.” Although intended to permit promotions like "ladies nights" to attract women to bars or clubs, the law appears drawn broadly enough to permit a "ladies discount" for a poker tournament. [FN2].

Based on my Twitter feed yesterday, it seems like many poker players and poker media members regard the "ladies discount" as a good idea. Change100 called the discount idea "genius", while Daniel Negreanu tweeted:

Bravo @WSOP addressing the issue of "men" playing ladies events by making it a $10k and giving ladies a $9k discount! Very clever!

Clever? Well, it certainly is legally creative; I give the WSOP that much. But as I often tell my clients, just because something is legal doesn't mean it's a good idea.

The problem with the WSOP's "ladies discount" gambit is that it sacrifices the WSOP's strategic position of moral superiority in the debate over the Ladies Event in exchange for the marginal tactical advantage of having a legal tool for preventing most men from playing in the event. Prior to this year, although the Ladies Event discriminated against men, the WSOP could defend the discrimination by pointing to the availabillity of numerous other open WSOP tournaments at similar low buy-ins which were available for critics of the Ladies Event. Now, the Ladies Event is nominally a $10K event for men, giving those men no realistic comparable WSOP tournament alternative to the de facto $1K tournament offered solely to women. Further, men entering the Ladies Event will have to pay ten times the entry fee for the same chance of winning the tournament as for women players; the WSOP presumably will not be kicking in an additional $9K to the prize pool for every women player, nor will men presumably be given ten times as many starting tournament chips. [FN3]. Consequently, men who enter the tournament will be at a real disadvantage to women in terms of tournament equity and expected return on investment, and the WSOP intentionally wants men to be at such a disadvantage. Just think of the public relations nightmare for the WSOP when a man pays the $10K buy-in and makes the final table or even wins the event and spouts off in interviews: "Hey, I had to give these women 10-to-1 odds, and I still beat them!" Talk about a credibility killer.

The Ladies Event through its history hasn't continued as a women-only (or women-mostly) event because it is technically legal to exclude men. It has continued as a women-only event because of etiquette, because of gentlemen and their manners. Gentlemen have understood that demanding to play in the Ladies Event is simply rude, regardless of whether they could force the WSOP to let them play as a matter of right. The women-only "rule" to this point has been enforced simply by social agreement to let those women who wanted to play the Ladies Event enjoy their special tournament as a matter of courtesy. But changing the rules as the WSOP has done alters the etiquette equilibrium. The new "ladies discount" rule changes the landscape from a place where the WSOP carved out a small niche tournament for a group of women poker players, to a place where the WSOP is actively placing men at a significant disadvantage to women in a tournament. Those complaints of discrimination by men that once came off as petty whining suddenly take on a lot more gravity.

In my view, the "ladies discount" rule forfeits the WSOP's moral high ground in the Ladies Event debate. The WSOP is basically claiming it needs a 10-to-1 buy-in ratio to protect the Ladies Event, and by extension the ladies participating in the event, from all those awful male poker players. In my book, that implicit attitude changes the Ladies Event from charming to demeaning, and from celebratory to vitriolic. In a word, the rule is rude.

-----------------------------------------------------------------------
[FN1] I have contributed my own zombie arguments to the Ladies Event debate, submitting a modest proposal for a compromise satisfactory to all sides, and making a demand for attention to a similar issue in the world of bingo.

[FN2] I haven't researched the relevant Nevada anti-discrimination laws personally, as I presume Caesars Entertainment (owner of the WSOP) has had its attorneys review and approve the ladies discount "promotion". However, I presume Nevada courts would likely put some boundaries on the sorts of marketing ploys that would be permissible under the differential pricing/marketing exception. For example, if the difference in pricing were so large as to render the goods or services at issue unavailable to men as a practical matter—say, a $500 gin and tonic, or a $10 million poker tournament entry fee—I could see a court holding that the price difference was an illegal pretext for discrimination. Here, even though the intent of the Ladies Event price differential is to encourage men to sit out, arguably the $10K entry fee is not inconsistent with a number of other WSOP events, and the fee is only ten times the price charged to women (equivalent to charging men $10 per drink, while women are charged only $1 per drink). In other words, although there is likely a line to be drawn between legal pricing and marketing differentials intended to encourage women to buy particular goods or services and illegal pretextual pricing and marketing differentials intended to exclude men entirely, the WSOP's $9K discount for women doesn't seem to have crossed it.

[FN3] It will be interesting to see if the Nevada gaming authorities would object to a purportedly open poker tournament where some players are forced to pay a substantially greater entry fee for the same chance to win the tournament as other players.

Seven Virgins, a Mule, and the Gypsy Queen: Welcome to the MGM Poker Show!

2013-01-27T22:36:00.001-06:00

Welcome back my friends
To the show that never ends.
We're so glad you could attend.
Come inside! Come inside!
....

Come inside, the show's about to start,
Guaranteed to blow your head apart.
....

Soon the Gypsy Queen
In a glaze of Vaseline,
Will perform on guillotine.
What a scene! What a scene!
....

Performing on a stool,
We've a sight to make you drool.
Seven virgins and a mule.
Keep it cool. Keep it cool.
....

Come and see the show! Come and see the show!
Come and see the show! See the show!

~ Emerson, Lake & Palmer, "Karn Evil 9 First Impression, Part 2"

As has been my tradition over the past several years, I found myself in Vegas as part of my holiday travels. Because Vegas is not the usual Christmas season destination, the couple of weeks before Christmas through a few days after the holiday are typically the lull before the Vegas tourist storm that is kicked off by New Year's Eve. It's easy to find bargain basement airfares and free or cheap upscale Strip hotel rooms during that holiday period, making a Vegas holiday trip extraordinarily economical. So, after a few great days hanging with my family at my brother's new home in Denver, I took a three day solo poker journey to Vegas.

This trip, MGM's MLife program offered me two free nights at a variety of hotels. I opted for the MGM Grand, both for quality of accommodations and out of nostalgia for my first trip to Vegas. Way back in the summer of 2006, the MGM poker room was smack in the center of the recreational poker universe. The Venetian poker room had been open only a few months, and was beautiful, huge, and mostly empty. The Wynn poker room had been open only a year. The "Big Game" had long migrated from Mirage to Bellagio, with the latter catering to bigger-rolled players ($2/$5 was the lowest NLHE game) while the former was waging a myopic war against no-limit games, preferring to cater to limit hold-'em and stud players. Many of the other Strip casinos had small poker rooms, with 6-10 tables spreading mostly $1/$2 NLHE and $2/$4 LHE.

MGM's poker room filled a key niche in the '06 Vegas poker ecosystem—the big room that catered to the "little" players. With 23 tables in a prime location between the sports book and Centrifuge bar, poker players could find a game nearly 24/7, and a packed room with waiting lists was common most evenings and weekends. The room catered to low stakes players, offering mostly $3/$6 LHE and $1/$2 NLHE (with a bankroll friendly buy-in of $60-$200), and some soft $2/$5 NLHE games. The MGM poker room had a definite "young gun" vibe, filled with brash, drunk, noisy players. Fortunately, most of those players were terrible, and finding a juicy, profitable game was generally easy.

Although the Vegas poker scene has evolved considerably during the intervening years, in many ways the MGM poker room is remarkably unchanged. Other than the more traditional poker tables replacing the MGM's original unique tables with a marble "racetrack" edge, the MGM poker room still looks identical to how it looked back during my first Vegas trip. Same location, same mix of games, same generally bad players.

Which was a good thing. A lucrative thing. A shooting fish in a barrel thing, or at least some sort of fish-poker-profit metaphor thing.

Buy into MGM poker room cash game.
Identify fish.
???
Profit!

My first two evenings I played $1/$2 NLHE, and managed to turn healthy two buy-in profits with a pretty ABC style, with the occasional aggressive steal play or semi-bluff thrown in for good measure. The fishing wasn't quite as good as in 2006, but there were some nice poker trout swimming around more than willing to nibble at the lures I was casting.

Which brings us to the last evening of my vacation. It was a Friday night, which would have meant a busy poker room on an average weekend. But this was the Friday before New Years Eve, and tourists were starting to surge into Vegas to get a jumpstart on their holiday celebrations. Dinner and drinks with some friends, with a detour to the Mandalay Bay sports book to sweat the end of the Missouri loss to UCLA, caused me to get back to MGM a hour or so later than planned. Losing that Mizzou investment turned out to be a blessing in disguise.

The MGM poker room was jammed, so I put my name on both the $1/$2 and $2/$5 NLHE lists. After a short wait, a new $2/$5 game was opened, so I settled in for what I figured would be a pretty standard game. Rarely have I so badly underestimated a game's potential.

Come inside, the show's about to start. Guaranteed to blow your head apart.

The game was wild from the git-go. No hand went unraised, and 3-bets routinely found three or four callers. I decided to sit back and play an almond-broker strategy, looking to trap the aggros with a monster hand. From the table chatter, it sounded like many of the players were regulars, or at least had played together on prior occasions. The players included myself, two young ladies, and seven guys who fit every stereotype of young, hyper-aggro yahoos.

Ah yes, two ladies, seven virgins, and a Mule (me, natch—the token non-reproducing jackass).

Much of the early action was being driven by two of the aggro dudes and one of the young gals. The lady was quite attractive, if you're into that sort of thing, which I'm not. She clearly was trying to dominate the table, and the two aggro dudes were equally clearly trying to push her around. One of the three would raise or 3-bet nearly every hand preflop, and on most of those hands, at least two of the three would stick around for the flop. The three were fearless, perhaps even reckless, pulling out a steady series of ballsy bluffs, ridiculous draws, sick calls, and improbable catches to win bloated pot after bloated pot.

Adding to the intrigue was the fact that none of the three players respected the others. Many poker games involve a little good-natured joking and even the occasional taunt. These three players were openly critical of each other, making the game a bit uncomfortable. After a while, it became clearer that those three had played together the night before, and one of the guys had caught an improbable runner-runner to snap off the lady's big pocket pair. This yahoo of course taunted the lady that she hadn't bet big enough on the turn, giving him "pot odds" to call. From their description of the hand, I doubt that's the case. Nonetheless, the three continued to trade rapid-fire caustic barbs about the other's poker skills, with a couple of the other yahoos chiming in whenever the chatter lagged.

The action hadn't been going on long when I felt a tap on my shoulder. It was Rob, of Ante Up and All Vegas Poker fame. Rob likes to recount his poker exploits on his "Vegas and Poker" blog, sometimes at great length. Well, almost always at great length. But still, his posts are an enjoyable read for anyone wanting a low-stakes Vegas poker fix between trips to poker mecca. Rob said hello, then pointed at the aggro lady and whispered conspiratorially, "Do you know who that is?" I shook my head. Rob chuckled, "It's Prudence!"

Keep it cool. Keep it cool.

Ah yes, the famous (infamous?) Prudence, the mysterious Queen of the Degenerates who has been featured in a handful (assuming we're discussing the Hindu goddess Mahakali) of posts on Rob's blog. Rob had always painted a picture of Prudence as a show-stopping diva, a modern-day poker-playing Lili Von Shtupp. Prudence did not disappoint. The Prudence Poker Show was a true masterpiece, blending snarky commentary with blitzkrieg poker tactics, seasoned liberally with a never-ending stream of blue language. In the space of a couple of hours, I heard Prudence flirt with dealers, heckle players, and use both the F-bomb and the derivative MF-bomb as every part of speech. Someone outside the game might have viewed the proceedings as a trainwreck, but in reality it was more like Prudence was playing a game of chicken with the other players, only using taunts and chips rather than cars.

Or, if you like, Prudence was the Gypsy Queen performing on a guillotine (I can't confirm any Vaseline but it's sort of implied, I think).

While enjoying the Prudence Show, I also actually played some poker. I used my tight image to steal a few nice pots preflop with 3-bets and 4-bets scaring off the lagtards who were focused on their d*ck measuring contest. I got a courtesy double up early on when my Queens (obviously) turned a set and another player put me on a bluff. Later, I took down a nice pot with Tens; the flop was low trash, I bet, got check-raised, then shoved over the top, leading to a major tank-fold by one of the mouthy yahoos. My thinking was that the yahoo likely had a medium overpair or was bluffing with big cards; though a set was always possible, the board really wasn't scary enough to make a set ram and jam. The yahoo tanking was a bit odd for big cards, unless he was just Hollywooding. I don't know if my hand was good there, but I suppose it was also possible the yahoo had something like a pair-plus-draw and didn't want to play a big pot on the come. Chickensh*t. Rob was railing Prudence (well, not like that) and asked me about the hand later; it would be interesting to hear his perspective (after all, I apparently inspired Rob to play the Spanish Inquisition to great profit the very next night).

Unfortunately for Prudence, the poker gods were not viewing her performance favorably, and she took several tough beats while also picking a couple of bad spots to make big moves. Some might suggest her steady consumption of "carrot juice" on the rocks contributed to her run of bad fortune, but I think her night was mostly the typical downswing part of the LAG roller coaster. Prudence and I only really tangled once, when I called her preflop raise (along with half the table) on the button with 76 sooooted. Yahtzee! I loved the 7-6-2 rainbow flop. Apparently, Prudence did as well, leading out with a bet that was raised by one of the usual yahoos. I made a big raise, and Prudence pushed all-in, leading the yahoo to fold. I insta-called and rolled my hand. The board ran out trash, and Prudence mucked. I don't know what Prudence held, but I suspect a middle pocket pair or maybe something like A7 sooooted.

Eventually the jawing between Prudence and the two main yahoos took a turn from entertaining to nasty when one of the guys started taunting Prudence after the other yahoo hit a lucky suckout to stack her, reminding Prudence of a similar suckout in their session the night prior when the yahoo's Q6s luckboxed a rivered boat to beat Prudence's altos dos pairs of KQ. The yahoo called Prudence an "effing moron". Prudence suggested the yahoo take his Q6s and do something unnatural that would likely kill his hand, at least in most nicer poker rooms. Suddenly the yahoo was calling for the floor, whining about Prudence's language (which although out of bounds for most tables, was hardly all that objectionable given the general chatter at the table to that point). A rather humorless floor gave a warning to the entire table about language. Of course, Prudence let loose another F-bomb moments later, and the same yahoo was again screaming for the floor.

What a scene! What a scene!

Prudence defused the situation by racking up for the night; probably a wise decision. I stayed for another couple of hours, building up a nice stack with a combination of good tight play and a fortunate run of cards. But the game was no fun without Prudence; just a bunch of social misfits grinding out pots with the only talk being discussion of poker strategy (most of it rather ill-conceived). FML, as Prudence might have said. I racked up a four buy-in profit, then played $1/$2 NLHE and drank for a couple of hours, having a lot of fun with the low stakes crowd while padding my profit for the trip.

I've seen a lot in various Vegas poker rooms. Drunk Englishmen taunting pit bosses and tackling me at the table. Grown men eating ribs at the table, after pulling them out of a jacket pocket. But the Prudence Poker Show was an instant classic. So on your next trip to Vegas, head on over to the MGM poker room.

Come and see the show! Come and see the show!

A little Keith Emerson Band to play you out ...

___________________

EDITED (26 JAN 2013): Added in detail re the Prudence-Yahoo throwdown to reflect Prudence's reminder in the comments as to the events in question. Her comments was dead on balls accurate re what the yahoo said.

The Mule Orthodoxy

2013-01-21T23:22:00.001-06:00

“Heresy is the eternal dawn, the morning star, the glittering herald of the day. Heresy is the last and best thought. It is the perpetual New World, the unknown sea, toward which the brave all sail. It is the eternal horizon of progress.

Heresy extends the hospitalities of the brain to a new thought.

Heresy is a cradle; orthodoxy, a coffin.”

~Robert Green Ingersoll, Heretics and Heresies (1874)

I happen to enjoy quaffing the occasional refreshing, medicinal beverage known as the Moscow Mule. In fact, I'm something of a Mule evangelist, spreading the good news of the Mule from South Carolina to Denver, and from Vegas to Canada. But I am also a Mule traditionalist, hewing strictly to the time-honored Mule recipe: good vodka, ginger beer, fresh-squeezed lime juice, and ice cubes, served in a copper mug. No mint, no bottled lime juice, no sugar or simple syrup, no crushed ice, no garnish other than a lime wedge, no highball glass. An orthodox Mule, if you will.

Part of my Christmas gift to my brother and sister-in-law,

so they can fight scurvy in Denver. Using cubed ice, of course.

Unfortunately, the more I evangelize for the cult of the Mule, the more Mule heresies I encounter. Some are minor, like flavored vodkas offered in a number of Des Moines establishments. Many of these "Mule Ranchers"—sort of a cross between a Mule and a Jolly Rancher—are actually quite tasty, particularly those that stick to fruit flavors which complement the ginger flavor of the Mule—pear, black cherry, apple, and peach seem to work well. Other heresies are more fundamental. "Drug Mules" swap out the vodka for silver tequila, while "Kentucky Mules" get their kick from good bourbon. Perhaps the most esoteric Mule heresy I've encountered was a "Tokyo Mule", based on dry saké and yuzu juice. All were highly unorthodox, yet all were very refreshing.

Maybe "heresy" is too strong a word for these mutant Mules. In a way, these Mule variants are more like a cover song or tribute album, putting a new spin on an old classic. Sometimes, the cover song introduces the listener to the original performer, like Metallica did for me with their cover of Diamond Head's "Am I Evil?". Sometimes, the cover version puts a whole new spin on the classic, rendering the original song accessible to a new generation (e.g., the Moulin Rouge remake of LaBelle's "Lady Marmalade" by Missy Elliott, Christina Aguilera, P!nk, Mya, and Lil' Kim) or a different audience (e.g., Travis Tritt's excellent countrified cover of the Eagles' classic "Take It Easy", or in the other direction, Carrie Underwood's great pop cover of the already amazing Martina McBride country classic "Independence Day"). For some songs, numerous wildly divergent renditions of the same song may be equally inspiring; witness the variety of approaches to Leonard Cohen's classic "Hallelujah" taken by artists like Jeff Buckley, John Cale, Rufus Wainwright, and k.d. lang (my personal favorite). In rare cases, a cover version may actually elevate a good song to something transcendent—Johnny Cash covering the Nine Inch Nails' hit "Hurt", or Whitney Houston's iconic rendition of the Dolly Parton hit "I Will Always Love You" (Entertainment Weekly recently published an intriguing behind-the-scenes story about how Houston came to perform the song for The Bodyguard).

Of course, not every cover song is an artistic success. In fact, most cover songs probably hover somewhere between William Hung's American Idol rendition of "She Bangs" and Billy Joe Jim Bob and Ellie Mae belting out a tequila-aided "Friends In Low Places" duet during karaoke night at Finnegan's Corner Tap. When it comes to Mules, often the heretical variations from the Platonic Mule more closely resemble "playing Kenny G on a kazoo" than "Kenny G covering Charlie Parker" (an abomination in its own right).

The most common unforgivable Mule sins are adding sugar or simple syrup to the mix, or garnishing with mint. Look, mojitos have earned their place in the scurvy-fighting refreshment pharmacopoeia. But sugar and spice do not make everything else nice, at least not in my copper mug. Speaking of which, a Mule served in anything other than a copper mug may well be refreshing, but it's like serving a fine red wine in jelly glasses—it will do in a pinch, but the ambience is lost (you'll have to trust me on this).

Which brings us to the ultimate Mule heresy—crushed ice. When sharing the Mule recipe with Otis, I felt confident I had conveyed the central importance of cubed ice. In fact, I said, "Ice cubes—must be 2 cm per side, made from water drawn during a new moon from the Ogallala aquifer (PRO TIP: Any ice from the closest freezer will work fine)." That's right: "Ice cubes". Good lord, could it be any clearer?!?

My WPBT bounty could not have been clearer:

Ice CUBES and NO MINT!

Nonetheless, Otis fancied himself the equal of Daniel Webster and proceeded to orate for his Mule soul, throwing down the gauntlet and claiming a mixology loophole rendered crushed ice superior to ice cubes. As Exhibit A in his impassioned defense, Otis demanded a jury viewing—and tasting—of the crushed ice Mule at Herbs & Rye in Las Vegas. Otis described the Herbs & Rye experience as pure rapture:

A giant man with a Thor-like hammer stood on the other side of the bar. He stuffed ice into a canvas sack (I’d learn later it’s called a “Lewis Bag”), put it on the edge of his bar, and beat it with his giant wooden mallet. It was simultaneously violent, artful, and erotic. I’d never been so turned on by a sweating 300-pound man in a black vest.

Thor went to work in a way I had never seen. It was at once robotic and fluid, like a wax museum bartender animated into a performance artist. By the time Thor finished, I had in front of me what amounted to a Moscow Mule sno-cone made with Fever Tree Ginger Beer and garnished with a paper-thin piece of lime peel.

A Moscow Mule sno-cone? Blasphemy!

Nonetheless, I am nothing if not a fair man. I determined that Otis and his crushed ice theorem should be given a fair trial, then shot like Old Yeller. So, during WPBT, I prevailed upon Lori to take me to Herbs & Rye, accompanied by a security force / jury of Astin and Travis. The scene was much as described by Otis, except for the two young, hipster Asian DJs spinning "Best of the 80s/90s Hip Hop Videos" in the lounge while we dined. Now that was an awesome trip down musical memory lanes!

The waitress brought drink menus, but there was no reason to open them. Three Mules were ordered. Three crushed ice Mule sno-cones arrived. I was duly skeptical. I sipped. The drink was tasty. It was ... very refreshing.

A second round of Mules were ordered by Lori and me, while Astin switched to a "Blood and Sand", a drink requiring an elaborate tableside orange bonfire. Apparently our order required more ice to be crushed, leading to our observing a 250+ pound man beating a block of ice into pulp with a massive mallet. Let's just say, if you own a massive mallet, you can crush all the ice you want for your bar and you will not hear a word of protest from me.

Perfect scene for a "Name that 80s/90s Hip Hop Video" contest.

Travis, Lori, and Astin, with a round of refreshments at Herbs & Rye.

All side dishes are better with bacon.

How to make artisan crushed ice.

Now THAT's a mallet!

An Herbs & Rye ice sculpture. Very refreshing.

I left Herbs & Rye very refreshed. Sure, much like Jabez Stone, I "got tricked and trapped and bamboozled, but it was a great journey." Still, although Herbs & Rye was a compelling opening gambit, the jury was still very much out on the crushed ice Mule.

Fast forward to late December when I stopped off in Vegas for a few days on the tail end of my holiday travels. During my stay, I sampled Mules in several spots. Nobhill Tavern in the MGM Grand served a decent Mule made with Smirnoff and Gosling's ginger beer, but it was served in a highball glass with crushed ice. It was good, but not great. Later, I had a Mule at Todd English's P.U.B. in Aria. This was the second time I dined at P.U.B., and the second time I was sorely disappointed by mediocre food. This time, I was also disappointed by a Mule served in a lowball glass with crushed ice and what seemed to be merely a splash of ginger beer. P.U.B. certainly took the mediocre Mule to an entirely new level.

But the greatest disappointment was saved for last. After a tasty dinner at Rick Mooney's RM Seafood at Mandalay Bay with Lori, Scott, Julie, and Poker Grump, we adjourned to Red Square to sample their Moscow Mules. When they were served, the Mules were not only sno-cones on steroids, but garnished with mint and served in pseudo-copper mugs (copper exteriors lined with non-copperish interiors). Mint sprigs were duly discarded, and Mules were sipped. Thankfully the straws enabled us to reach the beverage, but the mugs were barely 2/3 full at best. And thus were the two fundamental flaws of the crushed ice Mule laid bare—crushed ice waters down the drink while concomitantly squeezing out space for the beverage itself. Presto! Diluted Mule, and not much of it. Even the use of the uber-ginger beer Fever Tree could not save these Mules from mediocrity, and a second round was actually less satisfying (or more dissatisfying) than the first. The Mules even saved a final kick for when the waitress presented the tab—$17 per Mule. Sacrilege!

Red Square mint garnish gets the proper reception.

Poker Grump, Pkdlr, DiceGrll, & PokerVixen search for

pricey refreshment at Red Square.

Frankly, I have seen enough. Mene Mule Tekel u-Pharsin. The Crushed Ice Mule has been judged and found wanting. No more will I permit crushed ice to pollute the sacred Mule. No more will I tolerate watered-down Mules that require a bendy straw to sip. By grand edict of the High Priest of the Mules: Give me cubes or give me death!

Or a Templeton Rye. On the rocks.

“I myself have read the writings and teachings of the heretics, polluting my soul for a while with their abominable notions, though deriving this benefit: I was able to refute them for myself and loathe them even more.”

~Eusebius, The Church History

k.d. lang performs "Hallelujah" at the 2005 Juno Awards in Winnipeg.
(Yes, she's Canadian. Deal with it.)

Johnny Cash covers "Hurt".

Whitney Houston's ultimate rendition of "I Will Always Love You".

The Blind Paying the Blinds

2013-01-19T23:43:00.001-06:00

Earlier this week, I had to travel to Kansas City for work. As an executive, it's important that I set a good example for our department by finding an inexpensive hotel. So, I had no choice but to accept a comped room from Harrah's North Kansas City. My sacrifice better earn me a gold star from the Morlocks in Accounting.

After a great dinner of veal spiedini at Mike & Charlie's, I headed up to the poker room. The usually busy room had only two tables of $1/$2 NLHE running, sparse even considering it was a Monday night. The players told me that most of the bigger action games had relocated to the recently opened Hollywood Casino at the Kansas Speedway, which apparently has several NLHE and PLO games at the $2/$5 and $5/$10 stakes most days Thursday-Saturday, with juicy $1/$3 NLHE throughout the week. Conversely, most of the regular low stakes LE games had settled in down the road at Ameristar, a move that has been in progress for some time.

It didn't take long to realize that making a big score was out of the question. Though my game was full, there were only three stacks over $300, and my opponents were mostly almond brokers. As is usually the case in these kinds of games, my profit came mostly on two hands. I got a courtesy double up for nearly $200 from a guy who declared he was playing his last hand and was racking up. I called his preflop raise with 87 offsuit, flopped the nuts on a rainbow 6-5-4 board, and maneuvered him into calling my river all-in with just pocket Yaks. My other big pot was picking off a stone cold four barrel bluff when I went with my read and went to war with my pocket 9s which were good against this yahoo's 84 of crubs unimproved on a Q-J-5-5-J board; calling the pot-sized $75 river bet was tough, but hearing the yahoo's sigh as I put in the chips made stacking his chips all the sweeter.

Towards the end of the session, an older guy wearing dark glasses took an open seat at the table, with a younger guy sitting down next to and slightly behind him. Because a player had busted out of the seat the hand prior, the old guy was sitting down in what would have been the small blind, setting off this exchange:

Dealer: "Do you want to buy the button?"

Old Guy: "Sure. How much is it?"

Dealer: "Three dollars."

[Young guy puts out $3 for Old Guy.]

[Dealer deals cards.]

Old Guy: "Am I the small blind?"

Dealer: "You bought the button, so you're actually the big blind."

Old Guy: "I'm the big blind?"

Me: "Actually, you're both blinds."

Young Guy: "No, only he's blind."

[Crickets.]

Umm, yeah. Old Guy was blind and Young Guy was there to read his cards and the bets to him. I suddenly had a flashback to Dawn Summers' 2010 vacation to the Midwest, in particular where she had an entertaining encounter with a one-legged man in Des Moines. Considering it was pushing midnight, even I could see my "fox pass" was an omen, and I decided to rack up a healthy profit.

Me: "Good night, and good luck, y'all."

Old Guy: "See ya later!"

Indeed.

Dawn Summers Makes Me Say "Hmmm"

2013-01-15T20:27:00.001-06:00

For reasons that will become apparent in a later post, I was doing some searches for a particular blog post by the inestimable and prolific Real Dawn Summers when I stumbled across this interesting quote from conservative political blog "Freedom Matters":

“Obama is all style. No substance. He’s all ‘I want to send children to the moon,’ and then when you ask how he says ‘Hope.’” – Dawn Summers

O_o

Well clearly there has to be a FAKE Real Dawn Summers who just happens to hold the opposite political views of the REAL Real Dawn Summers we all know and love. Sort of a matter-antimatter thing. Real Dawn v. Anti-Real Dawn.

But wait. What's that on the Dawn Summers blog Clareified, from way back in February 2008? A tormented blog post, you say?

I called up pearatty last night after watching a particularly horrific Hillary Clinton interview with George somethingsomethingopolis.

“I’m losing faith,” I cried, “maybe Obama is better.”

“Dawn,” she said, “Obama is all style. No substance. He’s all “I want to send children to the moon,” and then when you ask how he says “Hope.”"

That made me laugh.

He totally would say hope. That wanker.

Obama is untested to say the least. He’s 40, has won exactly one statewide election –where his opponent was a transplant from another state — and he didn’t even give a crap about that job enough to so much as finish a half of it before he decides no running the United States is what he’d be better at.

Yeah, me too. I can run the United States. Um…I believe in myself and stuff.
And of course, should the idiot wing of the Democratic party will out and nominate…ack ack ack…Obama, I will work as hard as I usually work at things, to see that he…umm…loses to McCain by as few votes as possible. (I tried typing beats McCain, but I was giggling too hard that I couldn’t see the keyboard.)

~Dawn Summers, "They try to make me like Obama, I say no, no, no."

o_O

So, while I was busy in Iowa caucusing for our eventual President, Dawn Summers was calling him a "wanker"?

I am so telling Obama.

Politics—A Game of Chance

2012-11-28T22:53:00.000-06:00

Poker players are familiar with the "skill vs. luck" debate, which leaves most poker players scratching their heads trying to figure out why the law looks at a game requiring significant skill, then labels it "gambling" and lumps it in with games of pure chance like roulette, keno, and lotteries. But given that there is an element of luck or chance inherent in the nature of the game, perhaps banning or regulating poker as "gambling" is a necessary step to insulate the public from risking money on something as random as the turn of a card.

Of course, when it comes to politics, hypocrisy and arbitrary line drawing are standard plays. Games of chance might be too dangerous for people who want to play a little hold 'em at home, but apparently betting your entire roll on the luck of the draw is perfectly acceptable for politicians:

It's one of the weirder traditions of American democracy: In many states, if a [political] race is tied, a "game by lot" -- cards, straws, or most often, a coin toss -- determines who goes to the house and who goes home. Months of campaigning, committee assignments, the fortunes of careers, the possibility of political change -- it all comes down, like possession in a football game, to heads or tails.

That's right, after months of ads, yard signs, debates, rallies, speeches, and fundraisers, if an election is tied, the winner of the political race is generally decided by chance. But how can that be legal? Isn't a political office something too important to be left to the luck of the draw?

The election noted in the article above is a state legislature race in New Mexico, which is currently tied pending a recount. Under New Mexico law, "gambling" is defined to include both "making a bet" and "conducting a lottery". A "bet" is defined under New Mexico law as:

[A] bargain in which the parties agree that, dependent upon chance, even though accompanied by some skill, one stands to win or lose anything of value specified in the agreement. ...

A "lottery" is defined under New Mexico law as:

[A]n enterprise wherein, for a consideration, the participants are given an opportunity to win a prize, the award of which is determined by chance, even though accompanied by some skill. ...

Now, at least arguably, a political office is "anything of value" or "a prize", such that relying on the flip of a coin, playing of cards, or drawing of lots to win that political office would constitute illegal "gambling". Of course, it's not really so straightforward. Like many states, New Mexico's gambling laws carve out a wide number of exceptions for a variety of occupations and undertakings that rely in part of elements of chance. Here, New Mexico's gambling law exempts "betting otherwise permitted by law". Of course, there are statutes permitting tied political races—both state and municipal—to be determined by resorting to drawing lots:

In the event of a tie vote between any candidates in the election for the same office, the determination as to which of the candidates shall be declared to have been nominated or elected shall be decided by lot. The method of determining by lot shall be agreed upon by a majority of a committee consisting of the tied candidates, the county chairmen of the political parties that participated in the election and the district judge. The county canvassing board shall issue the certificate of nomination or election to the candidate chosen by lot.

In the event of a tie vote between any candidates in the election for the same office, the determination as to which of the candidates shall be declared to have been elected shall be decided by drawing by impartial lot. The method of determining by lot shall be mutually agreed upon by the candidates who are tied. The municipal clerk shall issue a certificate of election to the candidate chosen by lot.

So, by definition New Mexico law permits political races to be decided by drawing lots—by chance—yet still declares poker to be illegal gambling despite being predominately a game of skill. It would seem that if we as a society agree that resorting to a pure game of chance is good enough to determine something as sacrosanct as our democratically elected political leaders, then maybe, just maybe, we can trust adults to take a reasonable gamble on the turn of the cards in a game of poker.

I wonder where Ms. Ferrary and Mr. McMillan stand on the issue of legalizing poker. If one of them is ultimately awarded office by luck of the draw, I wonder if they will maybe, just maybe, look at poker in a different light.

What are the odds?

Generic Poker at Riverside

2012-11-25T23:42:00.002-06:00

Between work and training for several road races this fall, I haven't had many opportunities to play poker. Truth be told, I haven't really made much effort to carve out time to play, either. Probably an issue for another post.

This Thanksgiving weekend, however, provided me the chance to combine a Huskers football game with a couple of nights of poker at Riverside Casino & Nit Retirement Village. First, I stopped off in Marion for a wonderful traditional Thanksgiving dinner whipped up by the wife and mother of uber-wingman Santa Claus. Santa has some great women in his life. Then I headed out for some poker.

Thursday evening, Riverside only had one cash game running, so I had to kill some time in the bar watching the late football games, sipping a beer. Not an entirely horrible turn of events. After an hour or so, I finally got a seat in the $1/$2 cash game. It was filled with a bunch of players straight from poker central casting. Grumpy Granny was there, on my left, whining about the temperature being too low and her cards being lousy. Poker Professor was in the three seat, whining about his students and how others were playing. We had two Young Dudes With Bored Girlfriends Watching Them, both of whom were predictably arrogant, terrible, and (eventually) busted. There were two Retired Almond Brokers, playing one hand every two orbits. The other three players were Interchangeable ABC Players. I was left to play the role of Jester, a role which I thankfully have plenty of experience with.

Yes, I had landed in a Generic Poker Game, where I had never played with any of the other players, yet knew precisely how they played. To say the table played ABC poker was an insult to literate poker players. This was more like Dick and Jane Poker:

See Jane check. Check Jane, check!

See Dick bet. Bet Dick, bet!

See Jane raise. Jane likes to check-raise.

See Dick fold. Dick is sad.

Given the Riverside buy-in of $60-$200, the nitty players, and the fact the standard preflop raise was $5-$8, the game played as tight as my testicles in the nasty polar wind chill of the Husker-Hawkeyes game the next day. I raised preflop with pocket pairs five times, and three times flopped sets. I managed to get paid off on one of those hands. I quickly settled into a basic strategy of only playing Top Ten hands, and not making any moves. It was more profitable to simply drink Captain and Diets, watch football, and wait for a big hand versus big hand showdown than to try to run over a table of players who wouldn't put a dollar in the pot without at least top pair.

I managed to get up $150 or so. The late NFL game ended, and I decided to play no more than another hour, knowing I had to be up early in the morning to tailgate for the Huskers-Hawkeyes game. That's when I was in early position and looked down to see the Holy Grail of poker hands.

Yes, it was the Duck Pho. Offsuit, even, to give me two flush and straight flush draws instead of merely one. Easily one of the super-elite premium hands.

I limped in, as did six other players.

Flop was Ad-3c-5c. Wheee .... llll!

Donkey Kong!

I checked, as did the other players, to the button. The button bet $15. I min-raised, expecting at least a couple of callers. Nope, everyone folded to the button, who sighed, then flashed pocket Tens and folded. I tabled my hand, and the rest of the table glared at me; clearly I had breached some sort of protocol by playing "just" deuce-four. I tried to explain that the deuce-four was a special hand made famous by one of my poker friends, but they all acted like I had tried to share a recipe for bacon-wrapped shrimp with a minyan of Orthodox Jewish rabbis. Oh well, guess they'll never know how tasty bacon-wrapped shrimp or duck pho can be.

I raked the pot, tipped the dealer, and racked up. Generic poker may be cheap, but it ain't profitable.

At least the Huskers walked away with a small profit the next day.

Same Song, Different Verse:Poker Players Lose Again (South Carolina Edition)

2012-11-21T22:54:00.001-06:00

"Insanity: Doing the same thing over and over again and expecting different results."

~Albert Einstein

This morning, the South Carolina Supreme Court finally issued its long-awaited decision in Town of Mount Pleasant v. Chimento, the legal challenge to the application of the state's anti-gambling statute to poker games hosted in a private residence. Considering the case was argued more than two years ago, I think it's now safe to conclude that the reason for the lengthy delay between the argument and the ultimate release of the opinion was that the judges simply could find little common ground on which to agree. The court issued a fractured decision, with two of the court's five judges joining in a plurality opinion delivering the court's judgment, two judges joining in a dissenting opinion, and one judge concurring in the plurality's judgment while agreeing largely with the dissent's reasoning. Despite the fractured decision, the ultimate result was much the same as in other state court challenges to state gambling laws—the Chimento court held that poker was illegal gambling under state law, at least when played for money in a private home whose owner took a small rake or fee for hosting the game.

I. The Three Opinions

A. Case Background: I previously summarized in detail the factual background of the case as well as the primary arguments raised by the parties. I will presume you are familiar with my prior summary as you read the remainder of this post. However, I will summarize the relevant facts again here to help frame the court's decision:

The game was held in a private residence.
The game was regular and recurring, typically being held once or twice each week.
The game was open to new participants known to the game organizer or brought to the game by established players.
Participants—including new players—could learn about the game via an online social network.
The game involved very low stakes Texas hold 'em cash game play—blinds of 25¢ / 50¢, with a maximum buy-in of $20.
The game organizer (who also resided in the house with his girlfriend) took a small rake from each pot, ostensibly to cover food and beverage expenses. The game organizer testified that the maximum rake was 50¢ per pot, while a state investigator testified the maximum rake was $2 per pot (which seems unlikely given the stakes).

B. Issues: The illegal gambling charges against the defendants were based on a two-century old statutory ban on gambling (the full text of the statute is set out in my prior summary of the arguments). The court's analysis came down to two particular phrases in that statute (emphasis added):

If any person shall play at any tavern, inn, store for the retailing of spirituous liquors or in any house used as a place of gaming, barn, kitchen, stable or other outhouse, street, highway, open wood, race field or open place at (a) any game with cards or dice, ...

Essentially, the defendants argued that: a) poker was a game of skill and the statute implied only that card games of chance were illegal gambling; b) a private residence could not be a "house used as a place of gaming" where the only game being played was poker; and, c) the phrase "house used as a place of gaming" in the statute was unconstitutionally vague because an ordinary citizen would not appreciate that the statute might be interpreted to apply to a private home poker game.

The state argued that: a) the statute barred gambling on all card games regardless of whether they were games of skill or chance; b) a private residence could be a "house used as a place of gaming" if the owner or host took a fee or rake; and c) the phrase "house used as a place of gaming" in the statute could be understood by an ordinary citizen to apply to a poker game such as the one attended by the defendants, and thus the statute was not unconstitutionally vague.

The court was ultimately confronted with two issues. First, is playing poker in a private residence illegal gambling under South Carolina law? Second, if playing poker in a private residence is illegal gambling under the statute, is the anti-gambling statute unconstitutionally vague because it fails to clearly define "house used as a place of gaming"? If the defendants won on either issue, they could not be convicted of a gambling offense.

C. Plurality Opinion: At the outset, it should be noted this is the rare appellate decision (at least for a state court) which does not have a true majority opinion—a decision in which a majority of the justices agree both as to the judgment (the result) and the opinion (the legal reasoning used to reach the result). Occasionally, as here, a majority of the judges can agree on the ultimate judgment—reversal of the lower court and a reinstatement of the guilty verdicts—but do not agree on how the law supports that result. Such opinions are binding on the parties, but generally are not given as great of weight when cited by other courts. In this case, the plurality opinion by Justice Pleicones (joined by Justice Beatty) leads off the official decision because it is the opinion with the most support by the justices in the majority as to the judgment. As will be seen later, Chief Justice Toal concurred in the judgment (agreed the guilty verdicts should be reinstated), but actually disagreed with both the plurality and the dissent on different aspects of the constitutional questions presented.

After discussing the legislative history of the two-century old anti-gambling statute, the plurality first concluded that a private residence could constitute a "house used as a place of gaming", but noted that such a definition excluded "casual games" (emphasis added):

By altering the prohibition on playing prohibited games from “public house” to “house used as a place of gaming,” the legislature effectively adopted the view of Justice Brevard in his Brice dissent. What was originally a ban on merely playing these games “in a public house” became a ban on playing of these games in a residence or mansion house only when that house was “used as a place of gaming.” Thus, individuals gambling on a casual game in a person's home were no longer subject to prosecution under this statute.

If, however, a dwelling house is being used “as a place of gaming,” then all those playing the game, whether or not they are betting on it, and those present and betting, even if not playing, are guilty of violating § 16-19-40. To the extent that respondents argue that a residence or dwelling cannot be a house within the meaning of this statute, their contention is refuted by Faulkener, supra, and the plain language of the statute.

To determine whether the residence was being "used as a place of gaming", the plurality next looked at whether poker is illegal gambling under South Carolina law. This is the central issue in the case, and the place where the PPA's standard "poker is a game of skill" argument was brought to bear. The plurality sidestepped the entire skill/chance analysis, however, by finding that the skill/chance analysis applies only to "lotteries" while "gambling" involves betting on games, and thus any analysis of whether skill or chance predominates with respect to the underlying game is irrelevant (emphasis added):

Under the plain language of § 16-19-40, gambling on a game of skill is a violation if that gambling is being done in a prohibited location. The statute specifically lists several games that are exempt from the absolute ban on playing games in prohibited locations: billiards, bowls, backgammon, chess, draughts, and whist. These games all involve skill, yet betting on these games is a crime under the statute. [citations]. A violation of the gaming prohibition of § 16-19-40 does not depend on whether the particular game involves more skill than chance.

The plurality further held that, under South Carolina law, the key defining component of gambling is whether money is wagered, noting that money can be wagered on games of skill as readily as games of chance (emphasis added):

[G]ambling/gaming depends not on the skill/chance ratio, but on the wager.

We hold that one "games" within the meaning of § 16-19-40 when money is wagered on Texas Hold’em, even though it is a game in which skill predominates.

Thus, the plurality held that poker is "gambling" under South Carolina law because it involves betting on a game of cards; whether poker is a game of skill or chance is ultimately beside the point.

The plurality then moved on to the constitutional claim. The plurality first noted that merely because a phrase is undefined in a statute is insufficient to render a statute void for vagueness. The plurality cited to a 1909 decision for the proposition that "the evidence of keeping a gaming house is determined by the facts and circumstances" of each case. In this particular case, the plurality noted that the evidence supported a finding that the residence in question in fact was used as a house of gaming:

[T]he evidence showed that Stallings’s house was used regularly twice a week for poker games at which there was gambling, and that the games were advertised to interested persons on the website, and open to those individuals and their friends.

Further, the plurality contended that, although the statute might arguably be vague as to some persons involved in different types of games, the statute was not vague with respect to the poker game in question (emphasis added):

One whose conduct clearly falls within the statutory proscription does not have standing to raise a void-for-vagueness challenge. [citation]. We find respondents lack standing to challenge § 16-19-40,7 but also note that a person of reasonable intelligence would understand the statute to prohibit gambling on a card game at a house where players were invited on a regular basis to engage in this activity, especially where, while not a profit-making commercial activity, the players were required to contribute money to cover the host’s expenses.

Thus, the plurality held that because these particular defendants clearly should have known that this type of poker game was illegal under the statute, they did not have a viable constitutional complaint about how the statute was worded or applied.

D. Dissenting Opinion: Jumping ahead to the dissenting opinion, Justice Hearn (joined by Justice Kittredge) focused on the constitutional void-for-vagueness argument. In fact, the dissent expressly disavowed any comment on the statutory construction issues that formed the bulk of the plurality opinion, finding that it was not necessary to wrestle with whether poker was illegal gambling under the statute when the statute was, in the dissent's view, unconstitutionally vague.

Interestingly, the dissent did not directly disagree with the plurality's reasoning on the vagueness issue. In fact, the dissent specifically agreed that the defendants should have been aware that the poker game was illegal gambling:

As reasonable, intelligent people, Respondents should have understood the statute prohibited their conduct. It banned playing cards, with betting involved, in a house used as a place of gaming; Respondents participated in bi-weekly, organized poker games at someone's home with strangers that responded to advertisements on the internet, with a buy-in and the house taking a rake. While I question whether other individuals under different circumstances would have sufficient notice of whether their conduct is proscribed, such as four individuals who play a penny-ante poker or bridge game once per month, it is clear that Respondents were on notice their gambling fell within the ambit of the statute.

However, the dissent noted that there are two ways a statute can be unconstitutionally void: a) where the statute fails to give a person notice that their conduct is illegal, or b) where the statute fails to provide sufficient standards for law enforcement to objectively determine whether particular conduct is illegal. Although the two tests are intertwined to a degree, they are distinct.

The dissent then argued that the South Carolina anti-gambling statute failed to provide sufficient objective standards to guide law enforcement. The dissent noted that the phrase "house used as a place of gaming" was undefined and has no common understanding in the community. Thus,

Because the statute itself provides no guidance, it was up to police and local governments to determine just where this line is drawn. To that end, Officer Hembree believed that the frequency of the games, the number of players involved, and whether the game was run for a profit all factored into whether individuals were playing in a "house used as a place of gaming." However, none of these criteria appears in the statute, and Officer Hembree's decision to issue Respondents a citation was based on these additional elements imposed simply to ferret out conduct he truly believed violated the statute. Officer Hembree therefore had to take it upon himself to make a policy decision based on his own personal opinions as to what should be covered by the statute. It is also clear from Officer Hembree's testimony that had another officer entered Stallings' home, the officer could have come to a different conclusion.

In the dissent's view, the statute as written improperly permitted—even required—law enforcement officers to engraft their own criteria onto the statutory definition of "house used as a place of gaming", which necessarily would lead to different interpretations of the statute by different officers, and thus different treatment of poker players based solely on the policy of law enforcement where they lived:

Accordingly, when a statute such as section 16-19-40 or the one at issue in Morales grants officers too much discretion, the decision to target a certain individual is based upon the officer's own understanding of what the statute proscribes and not solely upon the language of the statute itself. Therefore, every arrest or citation is the result of the officer's personal exercise of discretion; the individuals he lets be are only granted that relief because he has decided their conduct does not fall within the proscription as he understands it. I agree with Justice Breyer that the inescapable conclusion accordingly is that the statute's application is invalid in every case, rendering it facially unconstitutional. A criminal statute is the place for setting forth with precision what conduct constitutes a crime, and our law does not sanction the idea that police and the prosecution can subjectively vary from the statutory elements and impose their separate criteria. If part of a statute permits such variance, as the one before us today does, that language is unconstitutionally vague.

E. Concurring Opinion: The court's decision ultimately came down to Chief Justice Toal. Her concurring opinion is quite interesting; in fact, it is rather unlike any other concurring opinion I can think of off the top of my head. The Chief Justice begins by stating, "I agree wholeheartedly with the constitutional analysis contained in the excellently researched and beautifully written dissenting opinion ...". Usually, one would expect the dissent to prevail after hearing how their argument is correct. However, the Chief Justice then goes on to proclaim that "because of the unique circumstances of this case, ... I concur in the result reached by the majority that these defendants' convictions must stand". Well, that's certainly an interesting case of judicial whiplash.

The Chief Justice begins her analysis in a rather straightforward manner, agreeing with the plurality that, even if the statute is vague, the defendants' conduct in this case was so clearly illegal that they had no legal basis ("standing") to complain about that vagueness:

I agree with the majority that these Appellants are foreclosed from challenging the constitutionality of this section because they were engaged in conduct that fell so clearly within the statutory proscription. This was not your penny ante game of poker organized in someone's home, but a regular card game hosted in Stallings's home after advertisements were posted on the Internet to recruit players who paid to participate. Thus, they do not have standing to challenge the statute as vague.

Thus far, the Chief Justice's analysis is pretty standard stuff. But then her opinion takes a twist, declaring that she finds the statute to be unconstitutionally void for vagueness, but is unwilling to strike down the statute because to do so would potentially render all gambling in private homes legal, opening the proverbial floodgates of criminal activity, causing great harm to the state (emphasis added):

In my opinion, striking this language would also open the door wide to all heretofore illegal gaming practices in this state, including video poker. See S.C. Code Ann. § 16-19-40(g) (proscribing the playing of "any machine or device . . . used for gambling purposes"). Because of this very real consequence, I am concerned that striking this critical language from the statute would beget, as elucidated by the General Assembly in 1816 when amending section 16-191-40, the "impoverishment of many people, corruption of the morals and manners of youth, . . . the tendency which is vice, misery and crime, as examples in this state have abundantly proven." These dire concerns resonate as much today as they did nearly 200 years ago. I do not need to remind any person of the havoc wreaked upon this State as a result of the "pernicious" practice of video poker. Although there are other sound provisions outlawing video poker, see S.C. Code Ann. §§ 1221-2710, 2712 (2000), I am loathe to strike the critical language from the general ban on gaming in the event that it guts these provisions, and consequently, South Carolina's longstanding prohibition against gambling.

In lieu of invalidating the statute as vague, the Chief Justice instead tossed the problems with the anti-gambling statute back to the legislature to fix:

Section 16-19-40 is hopelessly outdated, as it applies to any gaming activity (including all card games) played in a residential home whether wagering occurs or not. This section expired in usefulness long ago and should not form the basis of a modern anti-gambling statute. Thus, I now charge the legislature to modernize section 16-19-40, as I am inclined to agree with the dissent that this provision is constitutionally infirm. However, for the aforementioned reasons, I join the majority in result only, and would reverse the circuit court under these circumstances.

II. Analysis

A. Casual, Social, Low-Stakes Home Games Are Likely Legal (For Now): Although the court never explicitly ruled on the issue, a common thread in each opinion was that the game at issue was illegal because the game was more than a mere low-stakes, casual home game. The opinions went out of their way to emphasize that the game in this case was more than penny-ante ($20 buy-in; whoa, call in Ivey and Galfond!), was regular, invited players via social media, and paid a rake to the host. The opinions also expressed unease with applying the "house used as a place of gaming" designation for casual, social, low-stakes games. Given how the court's opinions were written, as well as the state's admission in oral argument that the statute did not apply to social poker games held in private homes, South Carolina poker players probably have some breathing space for hosting low-stakes, rake-free, private games and tournaments. But that doesn't mean some law enforcement officer won't decide to bust even those poker games, so proceed at your own risk.

B. "Poker As a Game of Skill" Argument Takes a Back Seat: After all of the time spent in testimony at trial and pages devoted in appellate briefs to the skill/chance argument, the court collectively shrugged and avoided any analysis of the issue. The entire argument was essentially ignored, except for the plurality opinion stating in passing, "We hold that one 'games' within the meaning of § 16-19-40 when money is wagered on Texas Hold’em, even though it is a game in which skill predominates." (emphasis added). Poker players will almost certainly latch on to this one statement and declare that the court held that poker is a game of skill. But in fact, the court actually held it didn't matter whether poker was a game of skill, so the court simply passed on deciding the issue altogether. This distinction is important, because other courts wrestling with the skill/chance issue will give little credence to what is essentially a throwaway, conclusory sentence which had no bearing on the court's analysis of the controlling issues (what lawyers refer to as "dicta").

C. Opinion Shopping: This decision is rather strangely written. As noted earlier, this decision featured fractured opinions and a lengthy delay (over two years) from argument to decision. Also, both the plurality opinion and the dissenting opinion contain full-fledged procedural and factual histories, which is uncommon unless the dissent wants to highlight certain facts; here, the plurality and dissent mirror each other. My read of the situation is that Chief Justice Toal waffled in her vote, and the two opposing sides wrote multiple drafts of opinions hoping to get her to sign on to their side of the decision. Based on the Chief Justice's ultimate concurring opinion, it was a close call, but her concerns about the possible negative effects of striking down the statute entirely eventually won the day for the plurality; the Chief Justice stared into the legalized, unregulated gambling abyss and flinched. As I discussed previously, given the Chief Justice's vocal concerns about the evils of gambling in a prior case involving video poker (referenced in her concurring decision in this case), nobody should be all that shocked that she finally sided with the anti-poker argument.

D. "Void for Vagueness" Is a Tough Argument to Win, Particularly for the Guilty: As a general rule, constitutional challenges are rarely successful, and the "void for vagueness" sub-genre is notoriously among the least likely to prevail; courts go out of their way to find statutes constitutional against vagueness challenges. In this case, the defendants also argued that the statutory proscription against any card game was vague and overbroad. As I noted in my prior analysis of the appelllate briefs:

[T]he defense argument on this point is a bit awkward, essentially stating, "You can't convict us for gambling when we were playing cards for money, because the statute might arguably apply to the kids next door playing Old Maid." Let's just say that the kids playing Old Maid, if they were ever arrested for gambling, would have a much stronger argument on this point than the poker players in this case.

Similarly, when you make a void for vagueness challenge, you want to be in the "gray area" of the law (preferably the light gray area) to demonstrate how extreme and unfair the prosecution is. Here, by contrast, the defendants were well into the dark gray area at best, involved in a poker game one step removed from an actual underground poker room, à-la Rounders. The defendants would likely have won their appeal if their game had been a truly casual, friendly, no-rake affair.

E. Judicial Hand-Wringing: Chief Justice Toal's concurring opinion bothers me a bit as an attorney. She could easily have said something to the effect, "Although I share the dissent's concerns as to whether the statute might be void for vagueness in some contexts, I agree that these defendants clearly crossed the line into illegal behavior." Instead, the Chief Justice went out of her way to express in great detail how much she agreed with the dissent about how poorly the statute was written (and how archaic the statute was). But instead of voting to strike down the law and forcing the legislature to enact a "modern" gambling law, the Chief Justice flinched at the idea of implicitly legalizing gambling by fiat, and instead resorted to the classic judicial dodge: "I really hate this statute, but my hands are tied. It is up to the legislature to fix this statute, not me." Now, such a hands off jurisprudence might be appropriate in many situations. Maybe it was even appropriate here. But it feels awkward to have a judge wax poetic about how a statute is flawed, only to punt at the last second to the legislature, leaving the actual parties in the lurch (and with a criminal record).

F. Things Could Get Worse for Poker Players: Given that the court essentially threw down the gauntlet challenging the legislature to fix the anti-gambling statute before the court is forced to invalidate it, I would expect the South Carolina legislature to enact a "modern" anti-gambling statute in its next session. Considering how socially conservative South Carolina is compared to the rest of the nation, don't be surprised to see a sleek new highly restrictive anti-gambling law rolling off the legislative assembly line in the next year. None of the justices gave any indication they would find a general ban on poker to be legally problematic, and in fact the court endorsed the idea that skill games can be the predicate for illegal gambling. Poker players may well end up in a worse legal position under any new law than they are under the archaic current law.

G. The PPA Is Still Inept: This case was a perfect storm of good factors for the PPA's legalization-by-litigation strategy. The statute was, by the court's own admission, poorly drafted. The trial court found that poker was a game of skill. Yet the South Carolina Supreme Court all but ignored the arguments made by the PPA in its amicus brief, and ultimately ruled against poker players in general and the poker player defendants specifically. Although this topic deserves its own lengthy post (in the works!), this case serves to underscore the ineptitude of the PPA on the litigation front. Frankly, it probably serves to demonstrate the futility of pursuing further poker legalization litigation.

As many of my readers are aware, I've long argued that the poker legalization-by-litigation strategy is flawed and ultimately doomed to failure, primarily because of the inherent difficulty in convincing an appellate court to flout historical and social understandings of poker as a form of gambling. My readers may recall I accurately predicted the failure of the PPA's Commerce Clause challenge to the Washington state ban on internet gambling. Similarly, I predicted the failure of the Chimento appeal, as reflected below:

Given the text of the statute and the related case law, I think the South Carolina supreme court will most likely find that poker is prohibited by the anti-gambling statute, regardless of whether it is predominately a game of skill or a game of chance. To hold otherwise would overturn decades of social agreement that poker is gambling, with the effect of essentially legalizing unregulated, for-profit poker rooms and poker tournaments statewide. As I've discussed previously, asking courts to rule that poker is not gambling is really no better than tilting at windmills.

[T]his is precisely the ruling I expect the court to reach—poker is gambling, and is legal if done as a private, no-rake game, but becomes illegal when played in a public place and/or for a rake or fee. Such a ruling would preserve the traditional notion of poker as gambling, prohibit poker in public or for-profit setting contexts, but allow casual home poker games to be played legally. Such a ruling is actually the result most poker players should want.

Of course, my prediction of the outcome is not the result most poker players think they want. But those players are short-sighted. Yes, the statute is rather poorly written, though that is mostly an artifact of its age. Yes, the statute could use clarity. Yes, it would be really nice if a court would recognize poker is a game of skill, and exempt it from an anti-gambling statute. But such a ruling would essentially legalize unregulated, for-profit poker rooms and poker tournaments throughout the state. The legislature would almost certainly react swiftly and negatively to such a ruling, and likely enact draconian restrictions against playing poker, including perhaps an explicit ban on online poker. Don't forget, this is South Carolina, where conservative "family values" politics still hold sway. Frankly, a fully pro-poker court ruling might be the worst result for poker players, a Pyrrhic victory leading to explicit and more onerous anti-poker laws.

Poker is illegal gambling under South Carolina law, regardless of skill element? Check. Casual home poker games are not illegal? Check. Charging a rake is a major factor in making home poker games illegal? Check. Judicial concerns about striking down the anti-gambling statute and legalizing unregulated, for-profit poker rooms preventing a pro-poker decision? Five star check. Legislature weighing in with broad new anti-poker restrictions in response to the appellate decision? Pending.

Look, I'm no legal Nostradamus. But I am an attorney with over 17 years of trial and appellate experience. The PPA's "poker as a game of skill" argument looks great on paper. But in the real world, it's not even worth using as toilet paper.

-----------------------------------------------------------------------

ADDENDUM:

Poker Grump has posted his thoughts about the decision, many of which dovetail with mine.

PokerFuse put out a nice news article about the decision which is worthy of reading.

My Recovery Run

2012-10-30T22:01:00.000-05:00

So last Saturday I ran the Spinx half marathon during my Mastodon trip to Greenville, South Carolina. There was joy. There was fun. There was suffering in the sun. But that story is for another post. Suffice it to say I ran 13.1 miles and, so far as I can tell, lived to tell of it.

Sunday was a travel day, and I intended to take yesterday and today as recovery days before easing back into my training for the Vegas Rock 'N Roll half marathon in December. Apparently my dog / personal trainer Berkeley had other ideas.

Berk: "OMG! OMG! You're home from work! Time to play!"

Me: "Hey bud. Good to see you. Now settle."

"Settle? I don't think so! I've been napping all day. Time to play!"

"Bud, I'm tired."

"Fine. I'll entertain myself."

"Berkeley Cooper put down that bed! Come back! Your bed is NOT a toy!"

"OK fat boy, we're going for a run then."

"No, we're staying home. I'm still sore. Ouch! Ouch! Stop biting my feet!"

"You're wearing SOCKS. You know I own all socks in this house."

"Those are my work socks. Drop them. Stop chewing my socks!"

"OK, but I have ways to persuade you to run."

"Ouch! Dude, why do you have to punch me? I have so many bruises on my thighs, my doctor is going to ask me if I'm in a 'safe place' next time I see him."

"We can do this the easy way or the hard way. Your call."

"OK, settle down and we'll go for a run. A SLOW run."

"That's more like it. Hey! What are those?"

"Gloves. It's chilly out."

"Those aren't gloves! Those are FRONT PAW SOCKS! ATTACK!"

"Ouch! Dude, my hands are in those gloves! Ouch!"

"Well let's run then."

"Slowly. Ouch! What was that punch for?"

"We're running fast. Get with the program."

"Ouch! Fast is fine then. No sprinting!"

"Wimp."

"I am sore. I've run two half marathons in the past two weeks."

"Whatever. You need some speed work, fat guy. Whoa! Trick or treaters! Bet they want to party. Hey kids! Want to play? Huh? Huh?"

"Berk! Enough! You win, we'll run faster. Stop scaring the kids."

"They aren't scared. They love me. Everyone loves me."

"I'm not loving you so much right now. My legs hurt. We're going to walk this hill."

"Hill? Yay! SPRINT!!"

"Aaarrrgggghhhh!!"

"Baby. Suck it up. It's just a hill."

"Aaarrrgggghhhh!!"

"Knock it off. You're embarrassing me. Now sprint home!"

"Can't ... breathe ... help ... me ..."

"Hey, good run! Now get me a treat. I said, GET ME A TREAT!"

"Chicken jerky OK?"

"It'll do. Oh, and we're running again in the morning."

"No we're not. We just ran five miles fast."

"Don't make me wake you up."

"Ouch! OK, we'll talk about it. Ouch!"

Don't even think of running without me.

Play with me. Or else.

My Accidental PR—A Half Marathon Soft Opening

2012-10-22T21:27:00.000-05:00

Rusty Ryan (Brad Pitt): "It's a soft opening. To test the place before the grand opening."

Linus Caldwell (Matt Damon): "Yeah it's kinda like a out of town preview on the town."

Saul Bloom (Carl Reiner): "Soft opening, grand opening. When they opened the Flamingo, one day it was closed, the next day it was open. End of story. I know, I was there."

~Ocean's 13 (2007)

It was a hectic last week. A major appellate brief to file. An unexpected three day trip to Phoenix to put out some corporate fires. The usual stuff that justifies my existence and my salary.

I got back into town after midnight Friday night, errr, Saturday morning. Berkeley greeted me with a slobbery assault, but was none too excited when I pushed him off his comfy perch on my legs at 7:00 a.m. to go coach my junior high Mock Trial team for our final practice before the regional tournament. Then it was off to Iowa City for some tailgating and night football with the sig other; well, tailgating at least, considering the Hawkeyes apparently forgot they had a game against Penn State. After a late night drive home, I finally crawled into bed after midnight, utterly exhausted.

So, why was I up again at 4:30 a.m. Sunday morning? Why wasn't I sleeping in late? Two good questions Berkeley was probably pondering as he once again lost the use of my legs as his pillows. The short answer—I'm an idiot. The long answer—I was registered to run the IMT Des Moines Half Marathon.

As I discussed recently following my Ali-like return to competitive road racing, I have been inspired by a bunch of poker degenerates to convert my irregular fitness routine into a quest to recapture the halcyon days of my running prime, or at least to give myself a physical challenge to pursue in an effort to deny the effects of advancing middle age. My major goal is to run a solid time in the Vegas half marathon, held this year on the auspicious date of my actual 43rd birthday. I don't have a lot of life rules, but one of them is, if you plan to run under the neon lights of Vegas, be in good enough shape you don't die—at least not in front of the Stratosphere or Circus Circus. Pro tip: Wynn and Aria are much classier places to collapse from ventricular fibrillation.

So I have been pushing an irregular training schedule since early summer, inspired by the sage advice/torture tactics of poker-running guru/fanatic Poker Peaker (a/k/a Dan England). Most of the Peaker's advice includes wisdom such as, "Run faster!" and "Kill you not, tempo runs will." Still, I have slowly regained some of my prior speed and stamina over the past few months, enough so I no longer fear embarrassing myself come Vegas—well, at least not in the half marathon. I can't make any guarantees about WPBT-related festivities.

This summer, I set an ambitious goal of breaking 1:51.26 (8:30 min/mile pace) in Vegas. Hey, it's good to have goals. I knew I would need at least one long road race under my belt prior to Vegas, just to get back in the road racing groove. So I looked at the Des Moines running calendar and focused on two races—the Capital Pursuit 10-mile race and the Des Moines Half Marathon. I figured Capital Pursuit would be a good test of my progress, sort of a "proof of concept" run. The Des Moines Half Marathon would serve as a second preparation race as well as the perfect training run six weeks out from Vegas. A soft opening if you will.

Of course, I signed up for both races before committing to the Spinx half marathon as part of the Mastodon experience. So, with the Des Moines and Greenville races on back-to-back weekends, what was the ideal solution? Well, other than getting one of the races rescheduled, which is actually much more difficult than one might expect.

Based on my fairly solid—and liquid—performance during the recent Capital Pursuit, I decided to keep my appointment with the Des Moines Marathon as a "serious" training race on my way to Vegas. The Spinxville race, on the other hand, would be a leisurely romp focused more on enjoying the company of friends than pushing my physical and mental limits in search of a personal record (PR).

PRs. Funny thing—I didn't have one for the half-marathon. I had run a lot of road races in my prime, but they were mostly 10Ks, 10-milers (Capital Pursuit), 20Ks (Dam2Dam), and one marathon. Ten years and twenty pounds ago, I ran a 20K (12.4 miles) in 1:32:13 (7:25/mile pace), which would translate into roughly a 1:37:00 half marathon. These days my older, fatter self has a Vegas goal of breaking 1:51:26 (8:30/mile pace). So, I figured if I ran 1:55:00 or better (8:45/mile pace) in the Des Moines Marathon, I would be in good position to make my goal for Vegas.

So, how did I do? Well, here are the splits via my Garmin watch and the official race timing chip lashed to my shoe:

Mile Split
1 7:41.1
2   8:31.8
3   7:36.7
4   7:59.9
5   7:58.6
6   8:15.3

6.5 54:35 (chip split)

7   8:13.4
8   8:17.7
9   8:15.7
10   8:24.4
11   8:40.1
12   8:34.6
13   8:09.6
13.1   1:22.4

Final 1:47:59 (chip time) (8:14/mile pace)

All things considered, I think I will give myself a solid "B+" for the race. I broke my goal pace by over 30 seconds per mile (tough), and my pace was right on the money with my pace for the Capital Pursuit 10-miler last month (very tough). Even more satisfying were Miles 6-10, where I ran consistent splits right at my race pace rather than slowing down significantly, something I have struggled with in prior races (Coach Peaker's tempo run torture really paid off). I did tweak an ankle late in the race (around Mile 10), but after 25 years of basketball injuries, my ankles really have no ligaments left and are held together with the natural equivalent of balin' wire and duct tape. Also, my kick the last two miles was not as fast as I would have liked. But I finished the race feeling strong, like I left a little in the tank.

Suddenly, running Vegas in 1:51:00 seems rather ... pedestrian. Maybe I can shoot for breaking 1:45:00 (8:00/mile pace). Heck, it wouldn't even be my greatest run-good PR for Vegas. It's good to have goals.

"Your shorts make your butt look fast."

"Bear! Run faster!"

"Half a mile for a full beer."

~Signs at the 2012 IMT Des Moines Half Marathon

Hellmuth & the Hobgoblin

2012-10-05T22:29:00.000-05:00

"A foolish consistency is the hobgoblin of little minds, adored by little statesmen and philosophers and divines."

~Ralph Waldo Emerson

In 1961, Roger Maris was chasing Babe Ruth's record for most home runs in a season. However, by that point in time, the season had been lengthened by eight games from the 154 game season played in Ruth's day. So, MLB Commissioner Ford Frick stated that, unless Ruth's record was broken in the first 154 games of the season, Maris' record would be noted officially as having been set in the longer 162 game season. The so-called "asterisk" debate stirred up great controversy, and led Maris himself to have a bitter view of how he was treated after breaking Ruth's record.

Yesterday, poker legend Phil Hellmuth became the first poker player to win both the WSOP Main Event and the WSOP Europe Main Event. The big win pushed Hellmuth into the lead for the 2012 WSOP Player of the Year award. Hellmuth's victory also extended his world record for WSOP bracelets to 13.

Or did it?

As reported by none other than poker media legend Shamus two years ago, there is (or at least was) some controversy over whether WSOP-Europe bracelets "count" as much as good old-fashioned WSOP-Vegas bracelets. Shamus even dug up a nifty quote from none other than great bracelet hound himself:

Phil Hellmuth, the all-time leader in WSOP bracelets won with 11, also chimed in on the subject this week. He was interviewed on the Hardcore Poker Show (the 9/27/10 episode) where he said he believed a WSOPE bracelet was "not the same thing" as a regular WSOP bracelet, adding that "everybody knows it's not really a bracelet."

The irony is delicious.

The debate over whether WSOP-Euope bracelets are equal in stature to WSOP-Vegas bracelets was hashed out thoroughly by poker media heavyweights BJ Nemeth and "Pokerati" Dan Michalski in the comments section of a Wicked Chops Poker post. To sum up, Nemeth noted that top poker pros did not regard WSOP-Europe bracelets as having the same prestige as WSOP-Vegas bracelets. Instead, Nemeth observed that poker players placed the greatest weight on WSOP Main Event and Players' Championship bracelets, then all other WSOP-Vegas bracelets were roughly equal in the next tier of prestige, and WSOP-Europe bracelets were yet another tier down the pecking order (often not counting as "bracelets" for bracelet prop bets). Michalski countered that if the Harrah's (now Caesars) empire declared an event a WSOP event and awarded a bracelet, then it was a WSOP bracelet regardless of the venue.

So, should Hellmuth's WSOP-Europe bracelet "count" as a "real" WSOP bracelet? As much as I love it when pesky hobgoblins come back to bite pompous jerks like Hellmuth, I nonetheless consider Hellmuth's WSOP-Europe bracelet the equal of his other bracelets (except his WSOP Main Event bracelet, of course).

If Hellmuth wants to justify changing his view as to the prestige given to WSOP-Europe bracelets, he can point to the fact that WSOP-Europe events now count toward the overall WSOP Player of the Year standings. But more fundamentally, I think WSOP-Europe bracelets are the equal of WSOP-Vegas bracelets on their own merits. Tournaments in both venues are generally among the largest in terms of buy-ins and numbers of players, and the player pools generally have greater depth and breadth of talent. Also, the WSOP-Europe events emphasize the "World" part of the WSOP. Back in the 1970s and 1980s, poker and the WSOP were dominated by Americans, and Vegas was the center of the poker world. Since the explosion of online poker, poker has truly become a worldwide phenomenon. WSOP final tables routinely have multiple non-American players, and non-Americans have won a sizable share of WSOP bracelets (including Main Event bracelets) over the past decade. Staging a WSOP series of tournaments in Europe—home to players like Peter Eastgate, Annette Obrestad, Pius Heinz, Antoine Saout, Viktor "Isildur1" Blom, and Bertrand "ElkY" Grospellier (just to name a few)—emphasizes the international popularity of the game and does nothing to diminish the accomplishments of the WSOP-Europe bracelet winners.

Disparagement of WSOP-Europe bracelets seems to be an extension of the criticism that the overall proliferation of bracelet events cheapens the value of a bracelet (there were fewer than 25 bracelet events per year prior to 2001, but then exploded into more than 50 bracelet events per year by 2007). This complaint misses the mark, however. The number of serious competitive poker players also exploded in the past decade in a perfect storm of internet poker, the Moneymaker boom, and poker media coverage, making a bracelet win a significantly more difficult accomplishment than even a decade ago.

Frankly, the discussion of the relative prestige of WSOP-Vegas and WSOP-Europe bracelets is just another contrived sports fan debate. It's really no different than the debate over whether Tiger Woods' four Grand Slam wins in a row constituted a true Grand Slam because they did not occur in the same calendar year, or an argument about whether current NFL passing and receiving records can be compared to records from the 1970s and 1980s when different rules were in force. These kinds of issues make for great faux debates, full of strong opinions but ultimately pointless. At the end of the day, players can only compete in the conditions as they are, not as they were, will be, or should be. Hellmuth's poker career spans over 23 years, with WSOP results of nearly 50 final tables in at least nine different poker disciplines, not to mention five runner-up finishes to complement his 13 bracelets, earned against increasingly larger and more sophisticated tournament fields. Hellmuth's WSOP-Europe Main Event bracelet is unquestionably deserving of the same prestige as his other WSOP bracelet wins.

But, if you have Hellmuth at your table in a tournament, I double dog dare you to tell him his record of 13 bracelets has an asterisk. Hilarity will ensue!

Breaking Wind in the Capital Pursuit

2012-09-23T22:49:00.001-05:00

Some days, it counts as a win if you don't die or shit your pants.

I'm calling today a win.

Over the past few years, I have had the opportunity to meet a good number of good folks who happen to love poker. I have enjoyed sharing some food, cards, and hijinks with a group of poker bloggers at the annual Winter Poker Blogger Tour (WPBT) held each December in Vegas. However, a subset of these fellow degenerates—loosely based in parts East—gather each year in G-Vegas (Greenville, South Carolina) for an event known as "Mastodon", a primal celebration of man's (and woman's) refusal to evolve. Mastodon has always been alternately alluring and frightening (check out the official invite/warning video), but this year, I figured it was high time I got high in South Carolina.

Part of this year's Mastodon festivities include an optional spin through one of the road races on tap for the Spinx Run Fest. Now I've been a runner since high school, but I gave up running road races years ago. As age and complacency have taken their toll, my commitment to running has gone from fanaticism to routine workout. So Mastodon—as well as the Vegas Rock 'N Roll half-marathon during WPBT in December—served as good motivators to kick my running up a notch.

I started training to get back in racing shape this summer, bumping up my mileage while throwing in the occasional long run (7+ miles) and tempo run (faster paced runs). I pegged the Des Moines Capital Pursuit 10 mile race today as a good training race, combining a long run with a chance to knock the rust off my road racing skills (such as they are). Back when I was a serious runner—10 years and 20 pounds ago—Capital Pursuit was one of the regular stops in my annual road racing repertoire, ranking behind only the Dam2Dam 20K as fun yet challenging distance races.

One of my best road races ever was finishing Capital Pursuit in 1:08:37 (6:51 min/mile pace). Considering I'm older, fatter, and lazier, my expectations for this year's Capital Pursuit were modest—don't die, and break 1:30:00 (9:00 min/mile pace). Secretly, I hoped to break 1:27:30. It's good to have goals.

Then last week happened. I was on the road for three days for work. I came down with a sinus infection I couldn't shake. I went to the doctor who put me on an antibiotic that led to, ahem, "intestinal distress". More ominously, the meds came with a four page brochure warning of horrific possible side effects. The most disturbing warning, taking up half the brochure, dealt with a rather alarming side effect. To paraphrase the warning:

CAUTION: This medication may cause spontaneous tendon rupture and random explosion or dismemberment of one or more extremities.

Well, that could put a damper on a casual run through the park.

Long story short, I took a full week off from running, mostly because running and intestinal distress make for an uncomfortable combination. I thought about skipping Capital Pursuit, but I had paid for my registration, my sinuses were feeling better, and my knee and ankle were feeling as good as they've felt in years, having had a chance to let my chronic tendinitis calm down.

So there I was this morning, waking up at 4:45 a.m. to start the pre-race ritual I hadn't followed in at least eight years. Rehydrate with a couple of Gatorades (the low-cal version for my older, fatter body). Munch a granola bar to get some carbs in my system. Curl up on the couch with my dog in my lap while I read my Twitter stream and Google reader feed. OK, so that last part is new. I'm a modern runner.

The weather this morning was about as perfect as could be asked for a road race. Temperature was upper 30s at the start, and mid-40s by the finish. Light breeze, low humidity. The stuff where personal records (PRs) are made.

The race followed the long-traditional course from downtown to the state capitol, then up to the Drake University area, on to the Waveland neighborhood, then back down the Ingersoll business district before the final dash though the heart of downtown Des Moines to finish at Nollen Plaza. The course is fairly flat, with no major hills and all inclines fairly gentle.

I committed the newbie sin of starting out too fast, letting the adrenaline of the start and the pace of the lead pack pull me out at a fast clip around 8:00 to 8:10 min/mile for the first three miles. For those of you who aren't runners, you have to trust me that running 30-45 seconds per mile faster than your goal pace is very difficult, and a recipe for disaster. Even thought I felt comfortable at the fast pace, I knew I likely could not maintain that pace over the entire course in my current conditioning level. I decided to pull back a bit for the middle part of the race, going closer to the 8:30 min/mile pace, and feeling good about it.

Then, disaster struck. Somewhere in Mile 7, I felt the dreaded signs of the return of my intestinal distress. Being three-plus miles from the finish line and the nearest kybos, I was in the uncomfortable position of not knowing if my guts wanted to break wind or make it rain. Letting out a small test sample was inconclusive, as the mind senses butt sweat and assumes the worst. So, I had no choice but to suck it up and finish the race with a noxious bubble of who knows what churning up and down my intestines.

Just past Mile 7, when I wasn't sure if I could finish the race, I spotted the sig other and our dog, Berkeley. Berk looked like he wanted to jump into the race himself. Seeing Berk (and the sig other) gave me a little boost, and I started to pick up the pace. I didn't have as strong a kick at the end as I would have liked, but I still tripped off the last three miles right at 8:00 min/mile. As I was pushing toward the finish line, some 40-something woman came sprinting out of nowhere to try to pass me in the last block. I tried to dig in, but quickly realized I was not going to beat her. So, I got my azz kicked by a woman—along with several dozen teenage soccer players, AARP members, mothers and fathers pushing strollers with infants, and people who outweighed my fat azz by 30+ pounds. Such is the world of running; all can compete, and often effort and training matter more than physical talent. Still, I finished in a comfortable and satisfying 1:22:21 (8:12 min/mile pace) (54 minutes in Paul Ryan timing).

As an aside, I must apologize to anyone who was in the downtown Des Moines Marriott approximately 9:35 a.m. and happened to stumble on to my version of this scene:

Altogether, I was pleased with my race. My pacing was not perfect, but I ran the entire race without feeling stressed or winded, and I feel like I could probably coax a little better effort in my next race. Coming off a rough week, I ran better than most of my practice runs. It's tough to extrapolate this race to the longer half marathons coming up, but I feel I have a solid shot at meeting my goals of running Spinx in under 1:54:42 (8:45 min/mile pace), and Vegas in under 1:51.26 (8:30 min/mile pace).

Assuming I don't die in a South Carolina bar during Mastodon, of course.

Never Forget

2012-09-11T23:36:00.002-05:00

Like most Americans of a certain age, I remember September 11, 2001 well. I had pulled an all-nighter at the office, working on an appellate brief. I had gone home for a quick nap, shower, and clean suit. I was ironing my shirt, watching CNN, when news broke of the first plane striking the Twin Towers. I remember thinking it was a terrible tragedy, but the idea of a terrorist attack was just one possibility. Then I watched as the second plane struck in the background of a live news update. That second strike made it real. There was no way it was an accident. America was under attack.

I remember going to the office, and watching in one of my partners' office as the Towers fell. I remember heading to a noon hour special Mass with several Catholic partners, even though I am a lapsed Lutheran. I remember heading home as they closed my building, the tallest in the Des Moines skyline, because right then the idea of a terrorist attack on an insurance building in the Midwest seemed entirely plausible. I remember watching hours of news coverage as America tried to come to grips with the thousands of little tragedies spinning off from the greater tragedy we were still unable to process.

Every generation has its defining event. For my grandfather's generation, it was Pearl Harbor, when America was pulled into history's greatest war against tyranny. For my father's generation, it was the assassination of JFK, the man who steered America away from the brink of nuclear war in the Cuban Missile Crisis, and was probably the last best hope to avoid the quagmire and historical-political repercussions of the Vietnam War.

For my generation, in 1995 I would have assumed our defining event to have been the Oklahoma City bombing, then the most significant act of terrorism on American soil. I still remember where I was when I heard the news of that attack—in my last year of law school, thinking about finals and the bar exam while supervising intramural softball. But somehow, the Oklahoma City bombing faded from the public memory in a few years, maybe because the terrorists turned out to be home-grown American radicals, maybe because times were good and Americans just wanted to move on. A few months ago, I was in Oklahoma City for a mediation. We walked past the Oklahoma City bombing memorial on our way from the parking garage to the soaring building where we were meeting. Our attorney rather off-handedly pointed out the memorial and mentioned how it was just part of downtown and not something he had visited in years. Just another historical marker for another historical event.

The terrorist attack on 9/11 truly was a defining moment for my generation. It dwarfed the Oklahoma City bombing in its scale, its brazenness, its evil. It was a sucker punch to the American psyche, an attack at the foundations of our culture on our home turf. The world changed for Americans when those planes hit the Twin Towers, the Pentagon, and the Pennsylvania countryside. We solemnly vowed we would never forget.

I remember the bitter political rancor that divided the country less than a year prior to 9/11, when a few hundred ambiguous votes and a split decision of the U.S. Supreme Court decided the hotly contested presidential election between George W. Bush and Al Gore. Yet in the days after 9/11, I remember being inspired by President Bush as he visited the still smoldering ruins of the Twin Towers. I remember my pride at Al Gore solemnly declaring, "George Bush is my President." I remember how Americans—so recently and so bitterly divided—came together, their political discord mended by a renewed sense of common cause.

We forgot.

Since 9/11, there have been three presidential elections, each more vitriolic than the prior. Americans are more polarized politically than ever. Red states vs. Blue states. Republicans vs. Democrats. Politicians willing to lie, dissemble, obfuscate, and slander merely to thwart the other side, without regard for the merits of the issue in dispute. America no longer has a common cause. It's good vs. evil, and evil vs. good. Compromise is a dirty word, an unacceptable surrender to the enemy. Bipartisanship is dead, slain by ideological purity.

I remember after 9/11 how Americans were careful to separate the terrorists from their Muslim faith. How politicians and clergy spoke of treating Muslims with compassion, to recognize that their faith does not condone such senseless violence, to understand that Muslims worldwide condemned the attacks and sympathized with our loss. I remember how the terrorists were our enemies, not Muslims.

We forgot.

Today, barely a decade removed from the atrocities committed by a fringe radical group more similar to the Oklahoma City bombers than to the average Muslim in the Middle East, the idea of a mosque in the same area as the Twin Towers is grist for conservative politicians and talk show hosts to whip up their base into a frenzy. These same radicals turn "Muslim" into a pejorative slander against our President, who makes the electoral calculation that it is better to declare his Christian bona fides than to defend the millions of Muslims whose faith follows a path of peace.

I remember when we sought those responsible for the 9/11 attacks and were viewed as the good guys, the righteous people seeking justice, not vengeance. I remember the broad coalition of our allies, and the support of those countries and peoples who prior to the attacks might have shared the terrorists' view of America as an arrogant, hedonistic behemoth who imposed her will on the world.

We forgot.

America's thirst for justice was subverted and perverted. We used the 9/11 attacks to justify a war against Iraq, a country with no connection to the attacks and posing no threat to American security. We began to torture enemies and suspected enemies, using euphemisms like "extraordinary rendition" and "enhanced interrogation techniques". We opened and continue to operate a concentration camp at Guantanamo Bay, enabling us to hold prisoners—even American citizens—idefinitely and beyond any judicial authority. We have Presidents of both parties asserting the authority to order the summary executions of not just foreign terrorists, but also American citizens thought to be terrorists. Those same Presidents who decry the loss of innocent Americans in the 9/11 attacks order drone strikes on terrorist suspects without regard for the collateral damage to innocent foreign civilians.

I remember when we viewed the 9/11 attacks as a fundamental attack on our American way of life. I remember how we swore we couldn't "let the terrorists win" by changing our core principles, by sacrificing our freedoms to assuage our fears.

We forgot.

Americans sold out their liberty for the illusion of security. Sensible security upgrades gave way to a nationalized system of security theater. Airports are filled with TSA agents irradiating and patting down millions of American citizens who pose no threat greater than transmitting the common cold with an unprotected sneeze. Now TSA agents are inspecting our beverages; it's only a matter of time before we all fondly remember the days when we did not have to strip naked before boarding a plane.

Even worse than the indignities of airport security are the more fundamental erosions of our rights. Today, the Homeland Security conglomerate mines the detritus of our daily lives, looking for suspicious patterns of behavior in the goods we buy, the books we read, the web searches we conduct, the people we meet. If we trip the wrong alarm, or piss off the wrong government official, we may find the full force of the government digging into our lives via secretive "national security letters" that circumvent our Constitutional due process rights. But it's all OK because the Government is simply trying to "prevent the next 9/11".

The 9/11 attacks unquestionably struck a major blow to the American way of life. But we do a disservice to those who died in the 9/11 attacks if we superficially remember their sacrifice while fundamentally altering our time-honored American values. Saying "we will never forget" is not about a monument or a memorial service. The best way to honor those who fell on 9/11 is to remember and celebrate the fundamental values of America—liberty, equality, and tolerance.

Never forget the essence of America.

In Cursura Veritas (In Running, Truth)

2012-09-04T20:54:00.001-05:00

"You are never really playing an opponent. You are playing yourself, your own highest standards, and when you reach your limits, that is real joy."

~ Arthur Ashe

Last week, Republican Vice Presidential nominee Paul Ryan brewed a political tempest in a teapot when he was caught lying about his history of marathon running during an interview with Republican talk show host Hugh Hewitt. Ryan, a fitness fanatic, proudly claimed to have run a sub-3:00:00 marathon, specifically asserting he had run "Under three [hours], high twos. I had a two hour and fifty-something." Trouble is, Runner's World writer Scott Douglas did some research and found that Ryan's only recorded marathon time was actually 4:01:25 at the Grandma's Marathon in Duluth, Minnesota (generally regarded as one of the top ten marathons in the United States).

Ryan's campaign issued a statement admitting Ryan had not been truthful, but suggesting Ryan simply mis-remembered his time from a race 20 years ago. Although Ryan's explanation is probably good enough to satisfy the general public, among serious runners his explanation simply doesn't hold water. By asserting he had run a marathon in under three hours, Ryan was claiming to be among the elite of recreational runners. In the 2012 Grandma's marathon, only 145/3425 (4.2%) of men and 165/5788 (2.9%) overall runners cracked the three hour barrier. By contrast, Ryan's solid but unspectacular actual time of roughly 4:01:00 was matched in the 2012 Grandma's marathon by 1573/3425 (45.9%) of men and 2169/5788 (37.5%) overall runners. Ryan's boast is the poker equivalent of bragging about making the final table of the WSOP Main Event while actually busting out long before the money.

There is exactly zero chance Ryan simply made an honest mistake. Runners remember their times from their most significant races; maybe not down to the precise second, but certainly they remember whether they beat certain paces or times. For a marathon, the significant times all runners know are sub-3:30:00, sub-3:00:00, and Boston Marathon qualifying (generally between 3:00:00 and 3:30:00, depending on age and gender). Looked at another way, the pace for a sub-3:00:00 marathon is roughly 6:30 to 6:45 minutes/mile, while a 4:00:00 marathon is roughly a 9:15 minutes/mile pace. Trust me if you aren't a runner, but 2:30 minutes/mile is a big difference over one mile, and a massive (and painfully impossible) difference over 26 miles. So, breaking a significant, elite time barrier like 3:00:00 is simply not something a serious runner would forget or make a mistake about.

On the political side, Ryan's lie generated some discussion from pundits who were baffled why he would misrepresent something so trivial and so easily checked (James Fallows at the Atlantic and Nicholas Thompson at the New Yorker have some interesting thoughts on the subject). But to to frame Ryan's lie in a political context misses the point, in my estimation. In the rough and tumble of politics, Americans have come to expect politicians of every stripe to exhibit a certain casual disregard for the Truth, spinning fantastical policy proposals and unleashing outrageous attacks on the policies and character of their opponents.

But Ryan's marathon lie is not a political lie, it is a personal lie, an illusion to provide the bona fides for the legend of Raul Ryan, all-American hero. Ryan's marathon lie points to a deeper character flaw than mere craven politicking. In Ryan, we have a man who ran a perfectly creditable first marathon at a young age. Yet it wasn't enough for Ryan to be part of the proud pack of Americans who have completed a marathon in average fashion. Instead, Ryan's personal narrative required him to be among the elite of marathon runners. So, somewhere along the way, Ryan bedazzled his racing résumé.

Ryan's lie pales in comparison to some of the more odious examples of its ilk—misrepresentations of military service and honors, job experience, and educational credentials are more serious and probably more common. Even among marathon fraudsters, Ryan's lie is rather petty compared with the notorious Rosie Ruiz who cheated her way to short-lived victories in the New York City and Boston marathons, or the lesser known but more ambitious Kip Litton who was recently outed as having cheated in several marathons in a quest to break the 3:00:00 barrier in every state, going so far as to even invent one marathon entirely (hat tip to @Iggylicious for pointing out Mark Singer's excellent piece in The New Yorker).

Still, Ryan's lie is probably more disturbing to those of us who are serious runners. For the vast majority of runners, running is not about prizes and accolades, running is purely about personal growth. In an ironic twist, running embodies the Ayn Rand-infused self-made-man mythos Ryan has long demagogued. Runners start from different baselines of ability, and have different natural limits to their talent. But within those parameters, whether a runner improves is solely a function of how hard they want to work. Sure, runners will race each other, but mostly runners are racing themselves, chasing their own personal records (PRs), seeing if they can set a faster pace through a section of hills, or trying to kick a great last mile. The only way to measure improvement—the only way to "keep score"—is by stopwatch. A runner who cheats on his time insults those runners who have put in the effort, the hard work, to earn their times.

Make no mistake, marathon training is hard work. It takes dedication to stick with training in heat, humidity, wind, rain, cold, snow, and ice. It takes commitment to organize your daily routine to include two hours or more for running. It takes grit to keep pushing yourself when you've run fourteen miles and have six more to go, and your legs are burning with lactic acid and your chest is straining for oxygen. But most of all, it takes mental toughness to silence that voice in the back of your head that wants you to ease up the pace, take a walking break, cut short a workout, or enjoy an extra rest day. Paul Ryan probably had—and may still have—the physical talent to run a sub-3:30:00 or even a sub-3:00:00 marathon. But Ryan chose the easy path, awarding himself the honor of an elite time he couldn't be bothered to work for.

Maybe Paul Ryan's marathon lie shouldn't disqualify him from becoming Vice President. Of course, in my view, many of his political positions have already disqualified him. Still, if you are an undecided voter, next time you hear Ryan wax poetic about how Americans can achieve anything they want through hard work, just remember:

Paul Ryan doesn't believe that.

United States v. Dicristina—A Win for Poker Players (with an Asterisk)

2012-08-23T12:23:00.000-05:00

"Well, let's not start sucking each other's dicks quite yet."

~ The Wolf (Harvey Keitel), in Pulp Fiction (1994)

As most poker players are aware, earlier this week a federal district court judge entered a ruling in United States v. Dicristina finding that poker is a "game of skill" and therefore is not "gambling" for purposes of the federal Illegal Gambling Business Act (IGBA). The lengthy decision by Senior Judge Weinstein is as thorough a discussion of the statistical evidence of the effect of skill in poker as one will likely ever see in a judicial decision. The opinion also contains an exhaustive review of practically every conceivable state or federal statute or appellate decision that addresses the regulation of poker in the context of gambling laws. Every poker player should read the decision to better understand the nature of the legal issues certain to arise as online poker continues down the path to inevitable legalization and regulation in some form.

I skimmed the decision when it was issued and Tweeted some initial thoughts (one of the advantages of being a lawyer is learning how to find the legally significant spots in a 120-page decision) (for the record, those Tweets are here, here, here, here, and here). After a more leisurely perusal of the decision, my initial thoughts remain valid, but I did pick up a few additional points of interest. Now many poker players probably just care about the bottom line—a win is a win, right? In law, however, how one wins is often more important than the case specific outcome. [FN1]

So, in no particular order, here are what I found to be the key points and interesting nuggets from the opinion:

Big win for poker players and the PPA: There is no question that this decision was a win for poker players. Having a federal judge give careful consideration to the "poker is a skill game" argument and then endorse it in a thoughtful opinion is a win, regardless of the ultimate outcome on any appeal, and regardless of whether the decision is adopted by other courts or remains a one-off outlier. The Poker Players Alliance (PPA) also deserves kudos for not merely rehashing its prior arguments, but for finding an expert economist and statistician, Dr. Randal Heeb, who provided critical analysis and testimony that formed the underpinning of the decision (more on Dr. Heeb later). This decision would not have been possible without the solid work of the PPA's attorneys, and the PPA rightfully should be proud of the decision. [FN2].

First meaningful win for poker: This decision is also important because it is the first court of consequence to issue a ruling that will have any precedential effect. To date, the handful of court "wins" for poker have all been issued by state district courts whose decisions have no binding or persuasive effect on other courts. Every appellate court to date has ruled against the "poker is a skill game" argument. But federal district courts occupy a unique spot in the legal authority realm. Federal district court decisions of consequence are "reported" (officially published) and can be cited as authority in other cases just like appellate court decisions. These district court decisions are not binding on other courts as an appellate decision would be, but they are often looked to as persuasive authority by appellate courts confronted with developing areas of the law. Having a thorough, well-crafted judicial opinion on the merits of the "poker is a skill game" argument on the books, so to speak, lends a certain gravitas to the argument which can bolster that argument if and when it is considered by other courts.

The decision has a shot at being affirmed on appeal: The obvious question on most poker players' minds is whether the decision can survive if the government appeals. An appeal is not guaranteed, but given that the decision breaks new ground and cuts against precedents from other federal courts, and considering that the government invested a lot of resources fighting this issue rather than plea bargaining what otherwise looks to be a trivially routine gambling case, I would expect there to be an appeal. Now Judge Weinstein is known for a liberal slant, and has written groundbreaking criminal decisions that were later reversed on appeal. But the Second Circuit is less conservative than most federal courts of appeal, and Judge Weinstein is well-respected as a smart judge (and former law professor at Columbia). Also, the case involves a bread-and-butter interpretation of a federal statute rather than a hot button Constitutional issue, so ideological differences among the appellate judges will have very little impact on the outcome of any appeal.

The decision is going to generate a lot of attention among the appellate court judges for several reasons. First, the sheer length of the decision will signal that something significant is occurring. The reason for the length of the decision is that Judge Weinstein spends a great deal of time going over legislative history as well as an exhaustive analysis of poker-related statutes and decisions from around the country. That kind of effort simply is not put into a routine decision, and the appellate judges will certainly note that Judge Weinstein is setting up his argument for a novel interpretation of the IGBA. The weakest part of the decision is that it conflicts with: a) prior federal court decisions related to the IGBA in which state gambling law served as the sole determining factor as to whether a predicate offense had occurred, b) prior federal court decisions in which poker was the predicate gambling activity for an IGBA offense, and c) numerous state appellate decisions and several federal court decisions that have determined poker is "gambling", including some which have considered and rejected the "skill game" argument.

To be blunt, established case law weighs heavily against Judge Weinstein's decision, and it would be fairly easy for the appellate court to reverse the decision. But, many of the prior IGBA cases can be distinguished because they assumed that poker was within the scope of the IGBA rather than analyzing the issue. Also, this case has the best, most detailed factual record as to the "skill game" issue of any court challenge to date. In this regard, Judge Weinstein was a fortunate draw for poker players, as his decision does an excellent job of pointing out the flaws inherent in the legal and factual assumptions underlying the prior adverse decisions. Judge Weinstein has marked a clear legal analysis path for the appellate court, if it chooses to follow his lead.

Nonetheless, I think the deck remains stacked against poker players if there is an appeal. Despite Judge Weinstein's adept "skill game" analysis, poker is still regarded as gambling both under New York law and in the public eye. Poker's reputation in front of the appellate court will certainly not be enhanced by the highly publicized Black Friday prosecutions (and the DOJ's "Ponzi scheme" commentary), particularly given the context of the IGBA's anti-organized crime history and purpose. As I have discussed previously, poker's reputation is a tough hurdle to overcome. Poker's considerable historical and cultural baggage might well overwhelm Judge Weinstein's legal analysis. And if the Second Circuit decides it doesn't want to endorse legalized poker, existing precedents will make it easy for the appellate court to reverse the decision. The easiest and most likely analysis to be used by the appellate court to reverse the decision is to follow those federal courts which defer to state law to define "gambling", and to find that New York state law governs the issue of whether poker is "gambling".

Interestingly, if the decision is reversed on appeal, the portion of the decision analyzing the "skill game" argument would potentially still have precedential value. If the Second Circuit decides that state law controls the "illegal gambling" question and that no further analysis is required under the IGBA, then the Second Circuit would never reach the "skill game" analysis. In that situation, although the case would have been reversed, Judge Weinstein's analysis of the "skill game" argument would remain fair game for citation to other courts (lawyers refer to this by the phrase "reversed on other grounds").

If I were a betting man, I would wager that the decision is ultimately reversed on appeal. But the odds against poker players are not nearly as long as they have been in past cases, and with a favorable panel of judges the decision has at least a puncher's chance of surviving on appeal. [FN3]

The decision is limited in scope: The decision only addresses the narrow question of whether poker is "gambling" for purposes of the federal Illegal Gambling Business Act (IGBA). As I have discussed in prior posts, when it comes to statutes, definitions are critical. "Gambling" for purposes of one statute may not be "gambling" for purposes of another statute. So the mere fact that poker is regulated as gambling under New York law (or another federal or state statute) is not necessarily dispositive of whether poker was gambling for purposes of the IGBA. Likewise, merely because the court ultimately found that poker was not gambling for purposes of the IGBA does not mean that poker is no longer illegal gambling under most state laws and possibly other federal laws. Still, if the decision holds up, it would remove one weapon from federal prosecutor's anti-poker arsenal.

Poker is illegal under New York state law: Although the defense team abandoned its argument that poker is not gambling under New York state law, the court nonetheless found that the argument had no merit. The decision explicitly noted that, "New York courts have long considered that poker contains a sufficient element of chance to constitute gambling under that state's laws." Another defendant could always raise a challenge to New York's state law on poker, but it seems doubtful that such a challenge would be successful.

Poker is still illegal under most states' laws: The decision contains an exhaustive listing of state laws and appellate decisions which consider poker to be gambling subject to ban or regulation (see Section II(5), pp. 47-51). The list is pretty bleak from a pro-poker perspective. Most states either explicitly define poker as gambling, or have found poker to be within the definition of gambling, regardless of the amount of skill involved. Again, poker players must keep in mind that, even if skill predominates chance in poker, states can still define "gambling" in such a manner as to encompass poker. The decision doesn't change how any state gambling laws view poker. So if poker was illegal gambling in your state prior to the decision, it is still illegal today.

Poker may still be illegal under federal law: The decision only interpreted the IGBA. There are other federal statutes that could still be used by federal prosecutors against businesses offering poker, most notably the Travel Act. Unlike the IGBA which contained its own definition of "gambling", the Travel Act simply relies on a violation of a state gambling law to establish the predicate offense. Also, note that the Travel Act prohibits use of "the mail or any facility in interstate commerce" to "distribute the proceeds of any unlawful activity" or "otherwise promote, manage, establish, carry on, or facilitate the promotion, management, establishment, or carrying on, of any unlawful activity". This arguably could mean that merely mailing checks, promotional materials, or awards to players could be a violation of the Travel Act. So far federal prosecutors have not used the Travel Act in any poker-related prosecutions (at least not to my knowledge), but that might change if they lose the IGBA as a tool because of this decision.

House-banked game defense was rejected: The PPA and many poker players have argued that the fact that poker is not a house-banked game (like blackjack, or three-card poker) is a significant distinction in determining whether poker should be considered "gambling". Even Judge Weinstein rejected that argument, rather summarily (p. 109). This argument is one of those situations where an important factual distinction winds up having no legal significance. So legally, if money gets wagered, it's probably gambling, regardless of how the house makes it profitable.

Revenge of the nerds: As noted earlier, it is obvious that Judge Weinstein was impressed by Dr. Heeb's statistical and economic research. Although there have been a number of studies that purported to prove that poker was a "skill game", those studies merely demonstrated that skill had an effect on the game, and none of those studies really reached any meaningful conclusions as to the relative effects of skill and luck on the outcome of the game. Dr. Heeb did some really interesting and persuasive analysis directed to that specific issue. One analysis showed that the "long term" required to allow skill to overcome chance is not nearly as long as might be imagined, perhaps as low as 1,000-3,000 hands (rates that can be seen over the course of a long, deep-stacked tournament or a relatively short period of cash game sessions). Another analysis attempted to isolate the skill element of poker by cleverly demonstrating how winning and losing players showed significantly different win rates even when playing the same hand (the examples Dr. Heeb used were K9o and QJs). Any fan of Freakonomics-style analysis would enjoy the court's discussion of Dr. Heeb's testimony. I don't think it is an overstatement to conclude that Judge Weinstein's decision likely would have turned out differently without Dr. Heeb's analysis.

The court's discussion also noted that most online players in the large dataset used by Dr. Heeb were losing players, with 90-95% of players showing net -EV. This statistic was somewhat higher than I would have expected. This statistic could also be used on appeal to argue that, since most players are expected to lose, poker is no different than house-banked games. Judge Weinstein dismissed this argument as irrelevant to the issue of whether poker is a "skill game", and I agree that it is not relevant. But that fact still is one that might be of interest to an appellate court.

The decision is probably not a game-changer: Even if the decision is affirmed on appeal, its impact on the poker legalization fight is likely to be minimal. In many states, whether poker is a game of skill is utterly irrelevant as poker is explicitly regulated as gambling. In other states where poker's status is not defined by statute, courts have already ruled that poker is gambling, and those courts are unlikely to reverse course after having decided the issue. The decision probably has little application to other federal gambling statutes because the decision is based on the IGBA's particular definition of "gambling". The decision is unlikely to affect federal or state poker legislation efforts as legislation is mostly a political issue which will not be swayed by one court's technical legal analysis of one federal law; poker simply isn't the kind of hot button legal-political issue like abortion or health care where a court ruling matters to legislators. It is possible that anti-gambling groups will use the decision to press for an explicit ban of online poker, but nothing I've read suggests that anti-gambling groups would have any better success passing a poker ban than pro-poker groups have had in passing poker legalization; those issues appear to be in stalemate at least through the upcoming elections. Most likely, the decision will ultimately have only symbolic value.

PokerStars may be the hidden winner: Because the decision is from a different court, it does not change the pending DOJ Back Friday criminal or civil forfeiture cases other than to make it marginally easier for the remaining defendants to leverage a better plea bargain or settlement because the DOJ's IGBA and associated money laundering charges are now in a somewhat weaker position. The Black Friday cases are ultimately more about the banking and financial shenanigans of those involved than the underlying poker businesses themselves. But the decision certainly strengthens the argument to be made by PokerStars to state gaming regulators that merely running an online poker business did not violate federal law. Even if the decision is reversed on appeal, PokerStars could still argue that if a respected federal judge thought that poker was not regulated by the IGBA, then they certainly had a good faith belief they were not violating the IGBA. Of course, there would still be the matter of PokerStars allegedly violating state gambling laws, the UIGEA, federal money laundering laws, and federal banking laws. But if the applicability of the IGBA and the Wire Act can now be called into question, it becomes easier to raise doubts about some of the other laws in the mix.

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[FN1] Think of the recent U.S. Supreme Court kerfuffle over the Affordable Care Act; although the Act was upheld, the legal reasoning in the decision placing limits on Congress' Commerce Clause authority may ultimately prove critical in decisions far removed in time and subject matter from the health care debate.

[FN2] The PPA's success in this case, however, does not change my prior critiques of the PPA's "legalization by litigation" strategy. The discussion of whether the damage done by the PPA's earlier legal blundering is redeemed by this decision is better reserved for a separate post.

[FN3] Thinking way down the road, if the Second Circuit affirms Judge Weinstein's decision, it could potentially set up a U.S. Supreme Court appeal to resolve a conflict among the various circuit courts of appeal as to how the IGBA is interpreted. This would be most likely if the Second Circuit finds that state law does not control the determination of what constitutes "illegal gambling". A lot of stars would need to align for poker to have a day in that Court, but these are the types of issues that are SCOTUS' bread-and-butter cases (i.e., interpretation of a federal statute, and resolving conflicts among the circuits).