The Long Arm of the Local Law on the Internet
In a chilling story reported by the Wall Street Journal on October 21, 2008, Kentucky judge Thomas Wingate seized the web addresses of over 140 internet gambling sites earlier in the week. According to Wingate, the gambling sites were “virtual keys” that provided the citizens of his state with the ability to play online versions of gambling devices such as slot machines and roulette wheels, which are illegal in Kentucky. Even though none of the sites are located in Kentucky, or operate technical equipment located within the state, since the sites regularly accept bets from Kentuckians and process payments from banks located there, Wingate felt he had standing to make the seizure.
“Seizing” the sites means that the entity that registered the sites cannot transfer the address to a different registrar, even if the address owner requests it. This means the gambling sites can still remain active while under the Kentucky seizure. Kentucky could issue a forfeiture order, which means the sites would become state property and be forced to comply with the judge’s orders, but the court has said it will lift its seizure if the sites implement technology that would prevent users in Kentucky from accessing their sites.
While you may think of the internet as a brave new frontier, sites are often forced to adhere to laws in the localities in which they do business. In 2000, for example, a French court forced Yahoo! to ban the sale of Nazi paraphernalia, even though Yahoo was based entirely in the United States.
By Robert Pothier