Amaya Forced to Pay Harsh Fines in Kentucky

Kentucky may have solved their budget gap issue with an extreme issuance by a state judge. The Franklin Circuit Judge, Thomas Wingate has sanctioned all owners of the online gaming company, Amaya Inc. , to each pay $870 million, which likely will help the financially troubled Commonwealth substantially. Amaya, a major gaming operator, was ordered by a Kentucky judge to fork over the damages caused by its subsidiary, PokerStars’ illegal operations within its borders between 2006 and 2011. Judge Thomas Wingate of the Franklin Circuit first fined the company $290 million for their discrepancies before it was tripled last Wednesday due to the state's request. To make matters worse for the gambling enterprise, Amaya was told by the state that they would have to pay a 12 percent interest every year that they do not pay off the debt in full.

Why Amaya Received the Fine

Kentucky began to take action against PokerStars in 2010 when the company was charged with illegally providing gambling services to residents of the state. In total, the company allowed 34,000 Kentucky players to play illegally on their website between October 2006, which is when the Unlawful Internet Gambling Enforcement Act was first enacted, and April 2011. In that period, PokerStars made approximately $18 million in aggregate revenue from Kentucky.

Amaya Forced to Pay Harshly

Wingate was able to give out his harsh judgment on the case that has been in discussion since 2010 due to a law that is hundreds of years old, which lets individuals that have experienced gambling losses sue their opponent. He argued that Amaya Inc, the owner of PokerStars, owes such a huge amount because they allowed Kentucky residents to use their website for half a decade after the 2006 Unlawful Internet Gambling Enforcement Act took effect.

Why This Judgment is Not Necessarily a Fair One

The figure now being demanded of PokerStars is a lot more than the $731 million that the company initially forfeited to prosecutors in 2012 to finalize their 16-month legal dispute. Additionally, Amaya was not even the owner of PokerStars during the time that Kentucky is making its case, as the Canada-based company forked over $4.9 billion in 2014 to purchase PokerStars and become its corporate parent.

What Judge Wingate is Thinking

In Judge Wingate’s ruling, he claimed that the former owners of PokerStars’ broke the law because it was good for their business. He estimated that 34,000 Kentucky residents lost over $290 million by using PokerStars between the years 2006 and 2011. As punishment, Wingate tripled these damages and set a 12 percent interest rate on the amount until it is paid in full.

Amaya's Reaction to the Penalty

Amaya has made it clear that they will fight against Kentucky’s decision by appealing and will dispute any liability that is claimed. They will also challenge the recovery sought from the owners of the Rational Group. an Amaya representative stated:

“This is a frivolous and egregious misuse of an antiquated state statute to enrich the contingent-fee plaintiff's attorneys hired by the Commonwealth and not the people of Kentucky.”

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