Flutter KY SCOTUS Appeal Sputters: Company Owes State $1.3B

Posted By Martin Harris on March 25, 2021

Flutter Entertainment wanted to run it twice. But the Kentucky Supreme Court said no.

On Thursday, Kentucky’s highest court denied the Ireland-based conglomerate’s petition for a rehearing of a December 2020 ruling against it. Now Flutter potentially faces the prospect of having to pay a judgment of $1.3 billion to Kentucky, and perhaps even more.

It’s the latest turn in a decade-long case concerning the global online poker site PokerStars, now owned by Flutter. At issue is the fact that PokerStars allowed Kentucky residents to play on the site during a period when Kentucky maintains it was illegal for PokerStars to have done so.

Ruling latest turn in long Kentucky-PokerStars battle

The case began in 2010. Ultimately the lawsuit sought to collect losses incurred by Kentucky residents who played on PokerStars between 2006 to 2011. During those years, PokerStars continued accepting American players on the site despite the Unlawful Internet Gaming Enforcement Act of 2006.

PokerStars continued to operate in KY and the rest of the country until April 2011. The site finally withdrew from the US following the unsealing of federal indictments and a civil complaint against PokerStars and other sites. Online poker players designate that event as “Black Friday,” a reference to the day the news broke.

In 2015, a lower court ruled in favor of Kentucky to the tune of $290 million. In 2018, The Stars Group successfully challenged that ruling. However, the Kentucky Supreme Court overturned that decision and reinstated the original ruling in Dec. 2020. At that time, the court also increased the damages to $870 million plus 12% compound interest annually.

By then Flutter Entertainment was involved. That’s because Flutter acquired The Stars Group and PokerStars in 2019 in a deal completed in 2020.

Now, thanks to interest, the overall total in damages has climbed to $1.3 billion.

Flutter continues to weigh options, Kentucky eager to collect damages

There are still cards to play, Flutter maintains.

“Flutter is disappointed by the denial of its rehearing petition and continues to strongly dispute the basis of the judgment,” the company said in a statement. “Flutter will continue to consider its position, including potentially appealing the ruling of the case to the US Supreme Court along with other legal avenues which it may pursue thereafter.”

The company also suggests it is likely that the final payment will be less than the current amount that has been imposed. The company expressed it was “confident that any amount ultimately paid to resolve this matter will be a limited portion of the reinstated judgment.”

That said, don’t expect Kentucky to stop pursuing the ever-growing pot the court has delivered it.

In a statement responding to the December 2020 ruling, Kentucky Gov. Andy Beshear emphasized how the judgment will help Kentuckians recover from effects caused by the COVID-19 pandemic. He also reiterated Kentucky’s critical stance regarding PokerStars having operated in the state.

“This will never be enough to make up for the damage to Kentucky families and to the state from their years of irresponsible and criminal actions,” said Beshear.

PokerStars currently operates in dozens of countries via its dot-com global site and several country-specific sites. PokerStars also now operates legal online poker rooms in three US states: New Jersey, Pennsylvania, and Michigan.

Photo by Victor Bouchard | Dreamstime.com
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