Harvard Law Professor Assesses Bad Actor Clauses as iPoker Talks Cool Off

In a press release issued on Tuesday, Laurence H. Tribe, Professor of Constitutional Law at Harvard Law School, who has been retained by PokerStars to lobby on their behalf in California, concluded “that the ‘bad actor’ provisions in two proposed iPoker bills in the California Legislature likely violate the U.S. Constitution.” Tribe’s Conclusions Tribe identified three problematic areas concerning the bills’ bad actor clauses (you can find his complete analysis in the full press release at the end of this column):
Constitutionally prohibited Bill of Attainder
Unconstitutional Takings
Equal Protection Violation Because of these three issues, Tribe concluded, “Taking all these infirmities in the bills into account, I believe that they should not, and would not, survive federal constitutional attack.” Online Poker Talk Slowing Down in California The Tribe press release comes just days after the sale of PokerStars to Amaya Gaming. At the same time, the Gambling Compliance is reporting that the buzz surrounding online poker in the state is starting to wear off. On Monday, Dave Palermo of Gambling Compliance reported that State Senator Lou Correa (the author of the online poker bill SB 1366) told tribal leaders “that he wants to run draft language by the California Attorney General, regulators and others to determine a number of issues, including the constitutionality of the “bad actor” provisions.” Palermo went on to say that Reggie Jones-Sawyer, who authored the Assembly’s online poker bill will not “rubber stamp” the changes proposed by the coalition of 13 tribes, and could schedule a “listening session” with the aforementioned Laurence Tribe. To 2015… and BEYOND! All in all California online poker is looking more and more like a long shot. Lawmakers are starting to get cold feet, there are two warring factions fighting over a Bad Actor clause, racetracks are still unhappy, and of course there is the slight (and by slight I mean massive) bit of uncertainty caused by the recent sale of PokerStars to Amaya Gaming. The poker community hoped 2014 would offer the “next step” with multiple states joining Nevada, Delaware, and New Jersey. Instead, however, what we have seen is a willingness to hurry up and wait. We’ll just have to wait and see how things continue to play out in Nevada and New Jersey. Here is the full press release detailing Tribe’s findings… Legal Analysis by Harvard Constitutional Law Professor Laurence H. Tribe Following a thorough legal analysis of Senate Bill 1366 (Correa) and Assembly Bill 2291 (Jones-Sawyer), Prof. Tribe concluded that both proposed bills are unlikely to survive a Constitutional challenge on several grounds. Among Prof. Tribe’s conclusions: Constitutionally prohibited Bill of Attainder:
The Senate and Assembly bills both contain provisions clearly designed to exclude readily identifiable (even though not expressly named) entities such as PokerStars from the California online poker market. These provisions fly in the face of the U.S. Constitution’s command that “[N]o State shall … pass any Bill of Attainder.”
Under settled principles, a law is an unconstitutional bill of attainder if it “legislatively determines guilt and inflicts punishment upon an identifiable individual without provision of the protections of a judicial trial.” The Framers drafted the Bill of Attainder Clause as “a general safeguard against legislative exercise of the judicial function, or more simply — trial by legislature.”… It is indisputable that S.B. 1366 and A.B. 2291 exclude certain former Internet poker providers from California’s intrastate Internet poker market without any judicial trial.
My conclusion is that both proposed bills are, and would probably be found by a court to be, constitutionally prohibited bills of attainder. Unconstitutional Takings
The bills also restrict the ability of entities like PokerStars to use their existing property, raising serious problems under the Takings Clause.
A court should also have little difficulty recognizing the harm to PokerStars’s intangible property – including harm that takes the form of rendering that property valueless as an object of sale or licensing to others – as actionable under the Takings Clause. Equal Protection Violation
… the Equal Protection Clause invalidates the Senate Bill’s strikingly arbitrary cutoff date—a date which has the unusual effect of excluding entities like PokerStars that are most established in the market.
…the inapplicability of traditional rationales for the temporally inverted cutoff date, and the discrimination against a single out-of-state company all come together to create a significant prospect that a court could be persuaded to invalidate the cutoff date under the Equal Protection Clause. Tribe concludes:
Taking all these infirmities in the bills into account, I believe that they should not, and would not, survive federal constitutional attack. About Laurence Tribe Laurence H. Tribe, Carl M. Loeb University Professor Biography Laurence H. Tribe, the Carl M. Loeb University Professor and Professor of Constitutional Law at Harvard University Law School, has taught at its Law School since 1968 and was voted the best professor by the graduating class of 2000. The title “University Professor” is Harvard’s highest academic honor, awarded to just a handful of professors at any given time and to fewer than 75 professors in all of Harvard University’s history. Born in China to Russian Jewish parents, Tribe entered Harvard in 1958 at 16; graduated summa cum laude in Mathematics (1962) and magna cum laude in Law (1966); clerked for the California and U.S. Supreme Courts (1966-68); received tenure at 30; was elected to the American Academy of Arts and Sciences at 38 and to the American Philosophical Society in 2010; helped write the constitutions of South Africa, the Czech Republic, and the Marshall Islands; has received eleven honorary degrees, most recently a degree honoris causa from the Government of Mexico in March 2011 that never before had been awarded to an American, and an honorary D. Litt. From Columbia University; has prevailed in three-fifths of the many appellate cases he has argued (including 35 in the U.S. Supreme Court); was appointed in 2010 by President Obama and Attorney General Holder to serve as the first Senior Counselor for Access to Justice; and has written 115 books and articles, including his treatise, American Constitutional Law, cited more than any other legal text since 1950. Former Solicitor General Erwin Griswold wrote: “[N]o book, and no lawyer not on the [Supreme] Court, has ever had a greater influence on the development of American constitutional law,” and the Northwestern Law Review opined that no-one else “in American history has… simultaneously achieved Tribe’s preeminence… as a practitioner and… scholar of constitutional law.” Previous Post Next Post amaya|bike|morongo|pokerstars About Steve Ruddock Steve Ruddock is a longtime member of the online gambling industry. He covers the regulated US online casino and poker industries for variety of publications, including OnlinePokerReport.com, PlayNJ.com, USPoker.com, and USA Today.

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