Kentucky to Get $100 Million in Bonds from PokerStars
PokerStars is on the hook for $1.3 billion to the state of Kentucky after the State Supreme Court reinstated the 2015 ruling against the World’s Largest Poker Site. After the Supreme Court’s ruling, PokerStars claimed that KY would not get a substantial payment from that judgment. The courts have forced PokerStars to eat those words.
On Tuesday, a Kentucky judge ruled that the state can collect on $100 million in bonds posted by PokerStars at the start of its legal battle. The question now remains when, or if, Kentucky will see any additional payments.
Kentucky to Receive $100 Million in Bonds
The first payment in the $1.3 billion judgment against PokerStars will soon be made. Franklin Circuit Court Judge Thomas Wingate ruled on Tuesday that bonds totaling $100 million must be turned over to Kentucky within 20 days. These bonds were initially posted by PokerStars at the start of its legal defense against Kentucky.
Back in December 2020, the Kentucky Supreme Court reinstated a 2015 decision that awarded $870 million in damages to the state. PokerStars won its appeal in 2018. The state was granted a request to add 12% interest to the judgment, making the total $1.3 billion.
Kentucky judge makes $100m ruling in PokerStars case https://t.co/rt484XMIBr
— Betting Distribution Page (@mocoteo) April 24, 2021
According to reports, lawyers for the state now claim that PokerStars owes $1.59 billion due to continued interest. The money is accruing compounded interest of $504,477 per day.
The state will get $100 million, but it will be interesting to see whether the state will get anything further.
PokerStars Lawyers Claim The Judgment is Invalid in Britain
A hearing was held on April 13th in Franklin Circuit Court regarding the bonds, and PokerStars’ parent company Flutter Entertainment has representation at the hearing. Louisville attorney Sheryl Snyder stated that “The statute in the United Kingdom treats the entire judgment as void and unenforceable. So the simple point is, my client believes that when you get to the United Kingdom to collect, they won’t let you domesticate the judgment.”
Flutter Entertainment is based in Dublin, Ireland. British law works a bit differently than US law. British courts do not recognize cases where damages are tripled. As such, it may be next to impossible to enforce this judgment there. With that said, it is still likely that a resolution can be made to the matter.
What Happens From Here?
There are a couple of things that could happen with this case. First, PokerStars can simply ignore things and let the $100 million in bonds serve as the only resolution that Kentucky will receive. However, this is not the smartest long-term solution for Flutter. That’s because PokerStars operates in other areas of the United States. If Flutter were ever to expand into Kentucky for sports betting or online casino games, they could not do so with a judgment over its head.
Of course, the company could set up some type of plan to pay the bill in full. However, that’s not going to happen because the award is excessive based on the amount of profits earned by the company in the state.
What is much more likely to happen is that Flutter will come to some sort of settlement with Kentucky regarding the judgment. We could see them pay something along the lines of $250 million to settle the overall judgment with the state. There may be other conditions such as PokerStars agreeing not to operate in the state or to go through proper licensing once online gambling is legalized in the state.
Ultimately, we think that a settlement will be made and there will an additional “pound of flesh” payment made to settle the matter. That would be the best course of action for the long-term good of Flutter in the United States.