One of the Black Friday charges made by the U.S. Attorney for the Southern District of New York involved violation of the UIGEA, which, basically, prohibits financial transactions done for the purpose of illegal gambling--that is, gambling which is in violation of any applicable state or federal law. (Forgive the imprecision; I'm trying to skip quickly over the technicalities without getting bogged down in order to get to the main point.) One presumes that their intention is to prove that the transactions in question were illegal under the UIGEA because the poker they were intended to facilitate is illegal under New York law.
If Liebman is right, there is a strong case that poker does not qualify as "a contest of chance" under New York law, since it is clear that skill is ultimately more important in poker than luck; otherwise it would not make sense to distinguish between good and bad poker players. That calls into question the whole premise that PokerStars CEO Isai Scheinberg and the other defendants broke the law by serving customers in the Southern District of New York, where they were indicted.Well, yes and no. To anybody who plays poker for a while, there is no doubt that skill dominates luck in terms of determining long-term win/loss results. But what is "clear" to poker players is not necessarily "clear" to courts.
I have not been able to find any case law that has ever squarely held poker to be a game of skill free from illegality under applicable state anti-gambling laws. There have been some passing references to poker as a game of skill in a few cases. But these are only references that go to whether any skill is involved in the game, not to the level of that skill as compared with the element of chance in the game. The actual decisions did not involve poker, let alone the more relevant question of the legality of offering poker games in a setting where the house directly or indirectly makes money by raking the game, charging an entry fee or selling food, beverage or merchandise to players.I can't tell when that was written, but I think it was several years ago.
Games of chance range from those that require no skill, such as a lottery, to those such as poker or blackjack which require considerable skill in calculating the probability of drawing particular cards. Nonetheless, the latter are as much games of chance as the former, since the outcome depends to a material degree upon the random distribution of cards. The skill of the player may increase the odds in the player’s favor, but cannot determine the outcome regardless of the degree of skill employed.
People v. Turner, N.Y.S. 2d 661 (N.Y. City Crim. Ct. 1995)To an experienced poker player, this reads like nonsense--because the "outcome" we care about is the long run, not any one hand--but the sad fact is that modern courts just have not shown the slightest tendency to see things that way.
The "poker is a game of skill" meme is entirely correct. The continuing legal campaign premised on using that meme to exempt poker from gaming laws is utterly quixotic. The PPA (and poker players in general) need to understand that the battle to legalize poker will not—indeed cannot—be won in court. At its core, the poker legalization debate is not about “skill vs. chance” at all. As a practical matter, poker is firmly entrenched in the public’s mind as a form of gambling. Look again at the Pennsylvania decision—it cites cases from nine states covering more than a century of legal decisions, all concluding that poker is gambling. In states with legalized gambling, poker is treated as just another casino table game, subject to the same general gaming regulations as blackjack, baccarat, craps, and roulette. Popular culture depicts poker players as swaggering gamblers and/or con men (e.g., The Sting, The Cincinnati Kid, Maverick, the new Casino Royale, and yes, even Rounders); to those not familiar with the game, poker as depicted in these movies is really indistinguishable from blackjack in 21, or baccarat in several James Bond flicks....
Given the publicly ingrained view of poker as gambling, attempting to persuade appellate courts to declare that poker is not gambling is ultimately a fool’s errand. Courts are inherently conservative institutions, reluctant to issue decisions that contradict a community’s long-standing and widely-held beliefs and values, absent some compelling argument. “Poker is a game of skill”—even though logically correct—is not particularly compelling beyond the insular poker community. Poker players probably gain some psychological boost from being able to convince their friends and family (and themselves) that their game is really different from other casino games. Poker books and websites benefit from persuading poker players that they can learn to win (if only they purchase specific products, of course). But setting aside laws that are more than a century old? If the PPA’s best argument is to parse the differences between Hold ‘Em and Let It Ride, they’ve already lost. Better for the PPA to spend its resources lobbying state legislatures and Congress for explicit legalization and regulation of poker, including provisions for low-stakes, not-for-profit home games.
It’s time to stop tilting at the “poker is not gambling” windmill.