Amaya’s Kentucky debt tripled to $870M

A state judge has ordered Amaya Gaming owned online poker subsidiary PokerStars to pay $870M to the Commonwealth of Kentucky.  Last month they were ordered to pay the state’s residents $290M in compensation for their ‘illegal’ dealings between 2006 and 2011, but on Wednesday the state’s request for triple damages was granted.

Worse still for the Canadian gaming giants, there will be no time to dwell on the decision if they don’t want that $870M sum to increase any further, as the debt carries an interest rate of 12% per year ($104M) until it’s completely cleared.

“They [Amaya] will probably see this as harsh medicine”, said Judge Thomas Wingate, who is renowned for siding with the state against online gambling sites. “But such are the consequences of violating the laws of Kentucky.”

The state initially filed the lawsuit back in 2010, arguing PokerStars had illegally provided its services to the residents of Kentucky during the previously stated time period (’06-’11). Amazingly the case is actually based on a 19th-century law that allows third parties to collect residents’ illegal gambling losses if bettors don’t act within six months. The same law permitted the state to seek these triple damages.

The Poker Players Alliance filed a motion to intervene with the state’s prosecution, in hope that any payment made by Amaya would go back to the players who actually lost the money in PokerStars games. But this funky 19th-century law conveniently doesn’t allow groups of individuals to collect treble compensation, and the intervention has thus far been dismissed as an attempt to cut Amaya’s losses.

If its appeals continue to fall on deaf ears and the company is indeed forced to cough up the full amount, Amaya has already hinted that it will ask former owners Isai and Mark Scheinberg – who were in control of the company during the infringement period – to pay the bill.

How likely they are to comply remains to be seen. We’ll be sure to keep you updated on the story as it unfolds.

Will previous owners Mark and Isai Scheinberg pay Kentucky?


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