Campos and Elie File Motions to Dismiss, Question UIGEA

October 3, 2011 - 2:06 PM EDT
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Chad Elie and John Campos, two of the individuals charged in the criminal case on Black Friday, have taken the offensive in a fight to dismiss all charges.

 

Chad Elie

Chad Elie, a former payment processor for PokerStars, Full Tilt Poker, and Absolute Poker, is charged with all nine counts listed in the criminal indictment:

  1. Unlawful Internet Gambling Enforcement Act Conspiracy
  2. Unlawful Internet Gambling Enforcement Act: PokerStars
  3. Unlawful Internet Gambling Enforcement Act: Full Tilt Poker
  4. Unlawful Internet Gambling Enforcement Act: Absolute Poker
  5. Operation of an illegal gambling business: PokerStars
  6. Operation of an illegal gambling business: Full Tilt Poker
  7. Operation of an illegal gambling Business: Absolute Poker
  8. Conspiracy to commit bank and wire fraud
  9. Money laundering conspiracy

Elie’s UIGEA Defense

In response to counts one through four, which revolve around the UIGEA, Elie’s attorney claims that, as a payment processor, he would fall under the exemption for financial transaction providers. He further argues that the poker sites and processors do not qualify as “persons engaged in the business of wagering” as the UIGEA defines the term, claiming that neither has a stake in the outcome of a contest of others, a sporting event, or a game subject to chance. He goes on to say that the UIGEA should be void for vagueness when considering its application to online poker and that, if that is true, the Rule of Lenity should let him off the hook.1

Elie’s lawyer also makes the popular argument that the UIGEA does not apply to poker:

UIGEA only applies to online poker if online poker is “a game subject to chance,” so that bets and wagers upon the outcome of the game fall within the statutory definition of “bet or wager.” But the phrase “game subject to chance is vague in several important respects.

He goes on to say that “a game subject to chance” is not a well-defined term and that it is unclear whether it applies to poker, “a game in which skill unquestionably plays some role.” He argues that the court should dismiss the charges because of this alleged vagueness and the Rule of Lenity.

His claim is, therefore, that counts one through four are legally insufficient.

Elie’s IGBA Defense

In response to counts five, six, and seven, Elie’s lawyer again argues that the relevant statutes are too vague.

Elie’s attorney argues that the Illegal Gambling Business Act’s definition of gambling does not specify poker or any game similar to poker, so it is not clear whether it should apply to poker. He further argues that making illegal the conduct of overseas companies doing business which is legal where it is undertaken would not be the spirit of the law as Congress intended when it passed the law in 1970. He says that the text of the IGBA makes no mention of overseas companies and that the history of the act does not suggest that it was intended to apply to them.

The attorney continues by arguing that the alleged violation of New York Penal Code §§ 225.05, the state law on which the IGBA charges are based, is void because of ambiguity. He asserts that the NY gambling statues do not clearly apply to foreign online poker businesses and that therefore the Rule of Lenity should be invoked.

Elie’s Response to Conspiracy to Commit Fraud and Laundering Charges

Elie’s lawyer says that count eight, conspiracy to commit bank and wire fraud, should be thrown out because Elie and the other defendants must have “intended through deception to cause actual harm to the bank” or to seek to expose the bank to “actual or potential loss.” Elie’s attorney says that the defendants did no such thing, arguing that the banks profited from the online poker transactions.

Finally, Elie’s lawyer argues that the money laundering charges should be dismissed with the IGBA counts because the money laundering count relies on the predicate offense of running an illegal gambling business.

Campos

John Campos was the Vice Chairman of SunFirst Bank in Utah, which processed payments for both PokerStars and Full Tilt Poker. He is charged with the following counts:

  1. Unlawful Internet Gambling Enforcement Act Conspiracy
  2. Unlawful Internet Gambling Enforcement Act: PokerStars
  3. Unlawful Internet Gambling Enforcement Act: Full Tilt Poker
  4. Operation of an illegal gambling business: PokerStars
  5. Operation of an illegal gambling business: Full Tilt Poker
  6. Money laundering conspiracy
Campos’s lawyers defends all of his claims in almost identical fashion to Elie’s. This does not necessarily mean that the court will rule the same way for both men, however, as their circumstances are distinct.

Subject: Poker notes that litigating the validity of the UIGEA would be a key step in getting clarity on this important issue. We will continue with updates on the progress of any rulings regarding the UIGEA.

Footnotes

  1. The Rule of Lenity is a common law principle that states that legal ambiguity should be ruled in the defendant’s favor.

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3 Responses to Campos and Elie File Motions to Dismiss, Question UIGEA

  1. Poker Expats
    October 3, 2011 at 10:35 PM EDT

    It’s great to see these guys taking a stand and calling “bullshit” on the DOJ’s charges. I hope the case gets lots of publicity and costs Obama the election for siccing his ignorant attorney general on the US-facing poker sites.

  2. Rob C
    October 3, 2011 at 10:39 PM EDT

    At least someone is putting up a defense challenging UGIEA. Everyone else the DOJ has indicted over the years has plead to something. I really hope they have deep enough pockets to hold out through the Supreme Court.

  3. MARTY THE CRUSHER FROM NJ
    October 7, 2011 at 12:55 PM EDT

    THESE MOTIONS TO DISMISS HAVE LITTLE CHANCE OF SURVIVING AS A WHOLE AT THIS STAGE OF THE CASE.

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