Today, the Kentucky Supreme Court reversed a state court of appeals ruling blocking an attempt by the Commonwealth of Kentucky to seize 141 domain names allegedly tied to illegal gambling. The Kentucky Supreme Court held that while many of the arguments presented in opposition to the seizure order were "compelling" and that they "may have merit," the Interactive Media Entertainment & Gaming Association (iMEGA) and the Interactive Gaming Council (IGC) lacked standing to bring the challenge because it was not clear that they represented any party actually affected by the order. The Supreme Court explicitly noted that "[i]f a party that can properly establish standing comes forward, the writ petition giving rise to these proceedings could be re-filed with the Court of Appeals."
The case began in late 2008 when, in a move to combat what it viewed as illegal online gambling, the Commonwealth of Kentucky convinced a state court to order the "seizure" of 141 domain names because the names allegedly constituted "gambling devices" that are banned under Kentucky law -- even though the sites were owned and operated by individuals outside of the state, and in many cases even outside of the country. Unless the sites screened out Kentucky users, the court held, the seizure order was proper. Despite the lack of extra-territorial authority of Kentucky state courts, some out-of-state registrars complied with the order and froze users' domain names.
In amicus briefs filed with the Court of Appeals and the Kentucky Supreme Court in support of a writ vacating the trial court's order, EFF, Center for Democracy and Technology (CDT), and the American Civil Liberties Union (ACLU) argued that the First Amendment, the Commerce Clause, and the Due Process Clause of the Constitution prohibit state courts from interfering with Internet domain names that were registered and maintained outside the state.
EFF expects to participate as amicus in future proceedings if and when the affected domain name registrants continue their challenge to the trial court's ruling.