Gambling.Now!

A Renton attorney is suing the state to overturn its ban on Internet gambling, a topic that has the U.S. mired in international trade disputes.

In a complaint filed last week in King County Superior Court, lawyer and poker aficionado Lee Rousso claims Washington’s online wagering ban conflicts with the U.S. Constitution’s protections of interstate trade.

“I think my chances are darn good,” Rousso told the Seattle Post-Intelligencer.

State lawmakers approved the Internet gambling ban by wide margins, and it went into effect in June 2006. It extended previous prohibitions on gambling by telephone or telegraph and upped the crime to a felony, rather than a gross misdemeanor.

The lawsuit is being handled by Attorney General Rob McKenna, who is responsible for defending legal challenges of state laws.

No one has been prosecuted under the Washington ban so far, but the state Gambling Commission “will continue with our enforcement actions,” spokeswoman Susan Arland said Monday.

Internet gambling also is prohibited under federal law. But that ban has sparked international trade squabbles with the countries that house online gambling operations.

The $15.5 billion Internet gambling industry is based outside the United States, though about half of its customers live in America. The U.S. law, approved last year, stopped domestic banks and credit card companies from processing payments to online gambling businesses outside the country.

The World Trade Organization ruled in December that the federal law unfairly targeted offshore casinos. The WTO told the U.S. it could keep restrictions against sport betting in place if they were also applied to American businesses, such as operators of remote horse betting.

Rousso’s lawsuit argues that Washington state’s law unfairly protects the in-state gambling industry, including card rooms and casinos.

If he loses in court, Rousso said he would push for another change in state law to make Internet poker legal again. “Our backup plan is to get this done politically,” he said.

Information from: Seattle Post-Intelligencer, http://www.seattle-pi.com/

Can a rubber ducky keep NBC dealing in dough from cellphone messages?

During each episode of the NBC game show, “Deal or No Deal,” a contestant tries to guess how much money is in 26 briefcases. Viewers at home on their couch can also participate by text messaging in guesses. The on-air contestant has the chance to win $1 million; at-home viewers have the chance to win $10,000.

Only catch: at-home viewers pay a 99 cent charge each time they send in a premium text message to enter.

Some of the most popular television shows like “Deal or No Deal,” “The Apprentice” and “One vs. 100″ have been raking in cash from similar text message contests. (They share the revenues with cell phone carriers.) The 99 cent charges are clearly disclosed to viewers. Yet, some viewers are upset about it.

Two game show fans in Georgia, a hairdresser and a secretary, have filed a class-action suit in Los Angeles alleging that these shows’ contests equate to gambling. The suits, reported in Advertising Age in late June, were first dismissed by a judge in Georgia before being filed in federal court in Los Angeles.

The issue at hand, whether the text message contests are promotions or lotteries, is a tricky one. Advertisers and media companies routinely run promotions where users pay to enter contests. Take the famous bottle cap contests long run by Coca Cola and Pepsi. Consumers buy a soda to see if they can win the grand prize. The difference here, the lawsuits say, is that losers in those contests still get to drink the soda whereas losers in premium text message campaigns are left with zero. They gambled – like they would in a lottery or at a casino – and lost.

It’s unclear if the lawsuits will go anywhere, but in the meantime, Limbo, a cell phone entertainment company, is promoting its Web site as a solution to the problem. Limbo has created a point system for text message contests, which lets people who participate in contests earn points that can be redeemed for CDs, magazines, toys and other goodies. Limbo says that the game shows should offer all viewers who participate in their text message contests something in exchange.

It’s not quite $1 million, but maybe the rubber ducky on Limbo’s site will do.

By LAURA SCOTT

The Kansas City Star

Absent a judicial decision that Kansas’ new casino law violates the state Constitution, people who enjoy losing their money as a form of entertainment likely will get their wish.As soon as next year, slot machines could appear at The Woodlands in Kansas City, Kan., with a casino in Wyandotte County following later. Other locations in Kansas are slated for casinos that depend on local voter approval.

The courts still could put a stop to it by declaring that casinos are not what the Kansas voters had in mind when they approved the state lottery in 1986. That would be a good move.

But if the courts don’t step in, a large issue for the state will be how to protect the gamblers — and the rest of Kansas taxpayers — from ethical and legal violations that inevitably accompany gambling.

Missouri’s Gaming Commission was a model for how to do that. It was state-of-the-art regulation when created in 1993 as a result of that state’s acceptance of casino gambling.

Sen. Harry Wiggins of Kansas City and others who worked on the new regulatory law made it a strong commission with tough enforcement powers. Early appointees to the commission viewed themselves as regulators, not cheerleaders for the industry.

Missouri’s laws regulating the casinos, their clientele and their ownership have helped to keep the gambling industry generally clean in the Show-Me State.

Last year, the model was tarnished somewhat because regulators decided to run a casino themselves — the Aztar in Caruthersville — rather than let it go out of business.

Government should have no role in making sure that casinos earn money. Tax dollars should not be spend to bolster casino gambling.

And that’s what’s wrong with the Kansas plan. It’s bad enough that the state sponsors a lottery and spends money on advertising to get people to play.

Separating folks from their hard-earned money at the roulette wheel or the one-armed bandits ought to be the job of the industry’s robber barons, not the state.

But in Kansas, the state will own the casinos as well as regulate them. That creates a difficult balancing act.

Of course, the state is trying to choose the operators for its facilities correctly. Gov. Kathleen Sebelius says that “one of my key guiding principles has been to insist upon continued strong oversight and controls.”

That’s an essential, and for ideas, the state should look to the Missouri commission’s rules on ethics governing regulatory staff and commission members, including prohibitions against coziness with casino operators.

Unfortunately the Kansas law impedes the adoption of regulations that require open records of casino operations. Virtually all financial information is hidden from public scrutiny, unlike in Missouri.

Further, Kansas regulation cannot possibly be as strong as it should be if the state is regulating itself. Already there is a confusing mishmash of bureaucracy with the Kansas Racing and Gaming Commission, the new Lottery Gaming Facility Review Board and the Kansas Lottery itself each having some aspect of oversight on the new gambling operations.

The governor appoints the racing commission and the Kansas Lottery Commission, and nearly half of the seven-member review board. The possibilities for turf battles and political gamesmanship among appointees of the governor loom large.

Even more problematic is the possibility that those who regulate will see themselves as promoters. State rules must be tough, and the governor must choose wisely.