Black Friday defendants lose motion to dismiss; FTP/GBT deal in “great peril”

black-friday-defendants-motion-dismissedA US federal judge has rejected motions by Black Friday defendants Chad Elie and John Campos to dismiss charges against them, clearing the way for a trial this spring. In December, Judge Lewis Kaplan stated it was “extraordinary unlikely that the entire indictment will be dismissed,” but on Jan. 26, Kaplan ordered all parties involved in the case to submit additional briefs to factor in any wrinkles that may have arisen as a result of the US Department of Justice’s new opinion on the scope of the Wire Act.

Neither Elie nor Campos, both of whom were involved in processing payments for online poker companies, were charged with violations of the Wire Act on Black Friday, but their attorneys suggested that the DoJ’s new stance on the Wire Act should similarly negate the relevant aspects of the Illegal Gambling Businesses Act (IGBA), which Elie and Campos were most definitely charged with violating. Specifically, the defendants feel that if the DoJ now believes “bets and wagers” unrelated to sports betting don’t violate the Wire Act, then “bets and wagers” on games that aren’t “house backed” (i.e. poker) shouldn’t fall afoul of the IGBA. Forbes’ Nathan Vardi reported that Kaplan wasn’t convinced, “at least at this stage,” leaving all eight counts intact as the men prepare for their trial, currently scheduled for April 9.

Still more drama unfolding from Groupe Bernard Tapie’s attempts to acquire the assets of Black Friday ‘star’ Full Tilt Poker (FTP). Following news that a group of pro poker players owed millions to FTP, Laurent Tapie gave an interview to iGaming France in which he clarified that 19 poker pros had outstanding debts to FTP totaling $16.5m. Poker Player Newspaper’s Wendeen H. Eolis claims to have uncovered more detail on what GBT lawyer Behnam Dayanim called the “greater liabilities” weighing down FTP’s ledgers. Eolis quoted “FTP insiders” as saying GBT was shocked – shocked! – to discover that the money left in FTP’s corporate accounts was $15-20m less than anticipated. In addition, passive FTP shareholders, apparently not convinced that the long-suffering poker-playing public will welcome the poker brand with open arms anytime soon, are allegedly balking at taking stock in the ‘new’ FTP. Finally, unanticipated liabilities in the form of debts to FTP vendors and service providers, for which GBT would be on the hook, may total another $15m. Taken together, in Ms. Eolis’ view, these obstacles suggest “the deal is in grave peril.”