Full Tilt Units, 10 Executives Win Dismissal of Civil Racketeering Claim

Units of Full Tilt Poker and 10 executives won dismissal of civil claims filed under the federal Racketeer Influenced and Corrupt Organizations Act.

The lawsuit was filed in June by Full Tilt poker players seeking to recoup, as a group, about $150 million they claim they lost when the Ireland-based Internet poker site and others like it were shut by U.S. Attorney Preet Bharara in New York. Federal prosecutors accused the sites in criminal cases of violating laws barring online gambling.

The shutdown date, April 15, 2011, came to be known in the online gambling world as “Black Friday,” U.S. District Judge Leonard B. Sand said in his ruling yesterday rejecting the players’ racketeering claims as “too attenuated” to proceed.

“It remains unclear whether the direct cause of the plaintiffs’ injuries was the decision by the U.S. Attorney’s office to temporarily shut down the Full Tilt poker website and seize the conmpany’s assets,” Sand said, “or was instead as plaintiffs’ conversion allegations suggest, the subsequent decision by one or more of the defendants to halt player withdrawals.”

Full Tilt, which was named as a defendant in the case, was not among the five affiliates, which included Full Tilt’s software developer and its site operator, that asked for dismissal of the racketeering claim.

Sand allowed the players’ conversion claim to move forward against three of the five Full Tilt units seeking dismissal and said the players could amend their claims against the other two entities.

The case is Segal v. Bitar, 11-cv-4521, U.S. District Court, Southern District of New York (Manhattan).

To contact the reporter on this story: Andrew Harris in Chicago at aharris16@bloomberg.net

To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net

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