Copyright - PK Kool Creative CommonsWarren Agin of the Tech Bankruptcy Blog recently reported on the intriguing case of Commonwealth v. 141 Domain Names.    In this case, the Franklin County circuit court permitted seizure of 141 gambling related domain names, including valuable names such as sportsbook.com and goldencasino.com.  A number of gambling related trade groups and Network Solutions filed amicus briefs against the seizure.  The State spent over 500 hours online determining that internet gambling "is available in Kentucky."

The decision was based on a civil forfeiture under the State's statute authrozing forfeiture of gambling devices.  In first examining the basis for in remjurisdiction, the court looked at a number of unclear decisions regarding domain names as property and finally focused on IRS appraisals and the scarcity of domain names.  The court found that domain names had economic value and thus, were property for purposes of finding jurisdiction. 

The opposing groups' argument as to the lack of a situs within Kentucky fell short.  The groups contended that the domain names did not have a presence in Kentucky because there were no registrars in the state. The court found that the domain names "transport the virtual premises of an Internet gambling casino inside the houses of Kentucky residents."

On the even more interesting issue of whether a domain name is a "gambling device,"  the Court's view was every bit as expansive.  The opposing groups pointed to the specific definition of a gambling device in the statute - a definition which conjures up visions of the gears and inner workings inside of a Lucky 7's slot machine.  The Court found that the domain names are "virtual keys for entering and creating virtual casinos from the desktop of a resident in Kentucky." 

If this ruling gets legs, it could result in a little less pain for the poor folks who foolishly bet on Mizzou v. Texas or Kansas v. Oklahoma.  Regardless, it raises an interesting view of a Court's willingness to expand the concept of property and mechanical statutory definitions into the virtual world of this century.