A local betting Web site entrepreneur faces possible extradition to Louisiana after authorities there charged the Seattle man with running an illegal gambling operation.

Nick Jenkins said he is awaiting Gov. Chris Gregoire’s decision on whether or not to sign the extradition release requested by Louisiana prosecutors, who say Jenkins’ now-defunct site, Betcha.com, violated federal and state laws against Internet-based gambling.

Jenkins, whose Seattle-based startup was raided by Washington State Gambling Commission investigators in early July, said his attorneys are trying to negotiate with the Governor’s Office to delay any move until his Washington state case is heard.

A status hearing on the case and possible Louisiana charges is scheduled for Wednesday morning.

Betcha.com offered internet-enabled matching of honor-based betting. Because Betcha did not accept bets or enforce payoffs, they hoped to avoid entanglement with U.S. state and federal gambling restrictions.

An earlier update was posted on Midas Oracle in August, Betcha’s Continuing Legal Struggles, and that update includes links to earlier Betcha discussion’s here. But contrary to the claim in that update, you can no longer follow Betcha’s legal problems on the Betcha blog. All posts back to July 9, about the time the Washington State Gambling Commission intervened, have been removed and no more recent posts added. (In that July 9 post Jenkins cited approvingly the efforts of Renton, WA lawyer Lee Rousso to have the state’s internet gambling law declared unconstitutional. The PI news article mentions that Rousso is now Jenkin’s attorney.)

One of the things speculated upon in some now-missing Betcha blog posts was the source of the state of Louisiana’s interest in the small Seattle-based internet start up. The article discloses that “Louisiana authorities became involved in the prosecution after a state trooper there placed a small bet as part of a joint investigation into online gambling.”

—

Yesterday, the Seattle Post-Intelligencer ran a story entitled “Betting web site’s computers seized.” Within hours, bloggers and other news outlets picked up the story and translated it into something akin to “Betcha shut down.”

Problem: the translation isn’t true. (WARNING: if tails of government bureaucrats running roughshod over its citizens turns your stomach, stop reading here.)

What’s Happening

What happened was this. Last Friday, Betcha’s attorneys and I met with the state Gambling Commission to address their concerns. They had us drive to their offices in Lacey, WA, about an hour from Betcha’s offices. The meeting lasted all of about five minutes, with it ending in a deputy commissioner handing us a pre-printed Cease and Desist order. I’ll attached a PDF copy of it later, but the gist of it was “shut down or else.” Why she couldn’t have told us this over the phone I am not sure — I suspect it had something to do with making my Friday afternoon a very expensive one. (Tax dollars hard at work.) At almost the exact same moment, Seattle lawyer Lee Rousso was, coincidentally, filing a lawsuit in state court asking the court to declare the state’s anti-Internet gambling ban unconstitutional. Although the law has previously been criticized on First Amendment grounds, and the Commission has taken positions in the past that appear pretty tough to square with any notion of free speech [], Mr. Rousso’s challenge is based on the Commerce Clause — that is, the law seeks to protect the in-state Native American casinos from out-of-state competition, and is therefore unconstitutional.

On Monday, I arrived to the offices early to unlock the doors so the raiders wouldn’t bust them down. (Not cheap to replace a busted down door.) A few hours later, Commission enforcers, indeed, showed up and took everything. Our books, our posters, my business cards — everything. (The warrant wasn’t limited – among other things, it included “stamps,” “printers,” “scanners,” “jewelry,” “envelopes”, “napkins”, “cardboard coasters” and “keys.”) No one from Betcha was there — not a good way to start the week, being on the business end of a roving commission. Ironically, my wife stopped by during the raid and chatted up Rick Herrington, the chief Raider (read: head of Commission enforcement.) When my wife asked Mr. Herrington whether they’d be selling our equipment on eBay, he shrugged his shoulders, as if to say “maybe yes, maybe no.” He then told her “Nick should have come to us first about this.” This exchange I find revealing: it seems that the Commission is more interested in ruining me and Betcha than anything else. Why? Because we’re near their turf.

As troubling was how the conversation continued. According to my wife, Mr. Herrington repeated several times “he’s breaking the law, he’s breaking the law.” When she told him that that was a judge’s decision, he replied “doesn’t matter, he’s still breaking the law.” (If that’s not guilty until proven innocent, I don’t know what is.)
On Tuesday, we petitioned a state court in Olympia to enjoin the Commission from this “seize and threaten now, ask questions later” approach. It almost never happens that a court will enjoin law enforcement from enforcing its version of the law, no matter how warped that version may be. This is an extraordinary remedy and we didn’t get it yesterday, although it wasn’t for lack of fantastic work by our lawyer.

The hearing wasn’t without substantial incident and irony. Apparently, although several people at both the Commission and Attorney General’s office had been served with our papers via fax, e-mail, and PDF, someone at the Commission did not receive an original copy of one of the documents, as required by the state service statute. As a result, we could not proceed until we could prove someone at the Commission had been served with an original copy of this document. We then had to race across Olympia to the Commission’s office in a nearby town to serve the Commissioner himself — personally. (Not a single person in the legal department was working on that glorious 94-degree Tuesday — go figure.) The irony — exactitude matters big time to the Commission when it comes to serving paperwork that they already had. But precision in reading a criminal statute that may result in me doing years in the Gray Bar Hotel, not to mention wiping out a fair bit of investor capital and no less than seven years of man work — nah.

What’s Next

In terms of next steps, the situation is this. We are pursuing an action to get a court to declare Betcha legal. If the law and/or the Constitution matters in Washington (open question, that), I am confident Betcha will prevail. In the meantime, however, we face a Cease and Desist Order from a Commission that appears hell-bent on destroying Betcha at all costs. We’re going to review it in detail later today and decide on a course of action. We may have to take the betting-for-money part of the site down until we get on the other side of the steamroller.

You can rest assured, however, about our resolve. The government bureaucracy has been running roughshod over the citizens of this country for far too long. [] Prosecutors make up facts, legislators make it a crime to play poker in your own home, bureaucrats rewrite the laws, logic and the dictionary — and we’re all left at their mercy. The frog is boiling and the water’s getting hotter every day. I pledge to the friends and users of Betcha.com that I will do my part to turn the heat down. If that means rotting in jail, so be it.

The text above appeared on Nick Jenkins’ blog at Betcha.com. Visit the original blog post to see all the links inserted in his text, and which don’t appear above.

Previous: IT DIDN’T TAKE LONG. NICK JENKINS’ BETCHA.COM GETS BUSTED THREE WEEKS AFTER LAUNCH.

Problem: the translation isn’t true. (WARNING: if tails of government bureaucrats running roughshod over its citizens turns your stomach, stop reading here.)

What’s Happening
What happened was this. Last Friday, Betcha’s attorneys and I met with the state Gambling Commission to address their concerns. They had us drive to their offices in Lacey, WA, about an hour from Betcha’s offices. The meeting lasted all of about five minutes, with it ending in a deputy commissioner handing us a pre-printed Cease and Desist order. I’ll attached a PDF copy of it later, but the gist of it was “shut down or else.” Why she couldn’t have told us this over the phone I am not sure — I suspect it had something to do with making my Friday afternoon a very expensive one. (Tax dollars hard at work.) At almost the exact same moment, Seattle lawyer Lee Rousso was, coincidentally, filing a lawsuit in state court asking the court to declare the state’s anti-Internet gambling ban unconstitutional. Although the law has previously been criticized on First Amendment grounds [1|2], and the Commission has taken positions in the past that appear pretty tough to square with any notion of free speech (an example), Mr. Rousso’s challenge is based on the Commerce Clause — that is, the law seeks to protect the in-state Native American casinos from out-of-state competition, and is therefore unconstitutional.

On Monday, I arrived to the offices early to unlock the doors so the raiders wouldn’t bust them down. (Not cheap to replace a busted down door.) A few hours later, Commission enforcers, indeed, showed up and took everything. Our books, our posters, my business cards — everything. (The warrant wasn’t limited – among other things, it included “stamps,” “printers,” “scanners,” “jewelry,” “envelopes”, “napkins”, “cardboard coasters” and “keys.”) No one from Betcha was there — not a good way to start the week, being on the business end of a roving commission. Ironically, my wife stopped by during the raid and chatted up Rick Herrington, the chief Raider (read: head of Commission enforcement.) When my wife asked Mr. Herrington whether they’d be selling our equipment on eBay, he shrugged his shoulders, as if to say “maybe yes, maybe no.” He then told her “Nick should have come to us first about this.” This exchange I find revealing: it seems that the Commission is more interested in ruining me and Betcha than anything else. Why? Because we’re near their turf.

As troubling was how the conversation continued. According to my wife, Mr. Herrington repeated several times “he’s breaking the law, he’s breaking the law.” When she told him that that was a judge’s decision, he replied “doesn’t matter, he’s still breaking the law.” (If that’s not guilty until proven innocent, I don’t know what is.)

On Tuesday, we petitioned a state court in Olympia to enjoin the Commission from this “seize and threaten now, ask questions later” approach. It almost never happens that a court will enjoin law enforcement from enforcing its version of the law, no matter how warped that version may be. This is an extraordinary remedy and we didn’t get it yesterday, although it wasn’t for lack of fantastic work by our lawyer.

The hearing wasn’t without substantial incident and irony. Apparently, although several people at both the Commission and Attorney General’s office had been served with our papers via fax, e-mail, and PDF, someone at the Commission did not receive an original copy of one of the documents, as required by the state service statute. As a result, we could not proceed until we could prove someone at the Commission had been served with an original copy of this document. We then had to race across Olympia to the Commission’s office in a nearby town to serve the one of the Commissioners himself — personally. (Not a single person in the legal department was working on that glorious 94-degree Tuesday — go figure.) The irony — exactitude matters big time to the Commission when it comes to serving paperwork that they already had. But precision in reading a criminal statute that may result in me doing years in the Gray Bar Hotel, not to mention wiping out a fair bit of investor capital and no less than seven years of man work — nah.

What’s Next
In terms of next steps, the situation is this. We are pursuing an action to get a court to declare Betcha legal. If the law and/or the Constitution matters in Washington (open question, that), I am confident Betcha will prevail. In the meantime, however, we face a Cease and Desist Order from a Commission that appears hell-bent on destroying Betcha at all costs. We’re going to review it in detail later today and decide on a course of action. We may have to take the betting-for-money part of the site down until we get on the other side of the steamroller.

You can rest assured, however, about our resolve. The government bureaucracy has been running roughshod over the citizens of this country for far too long. (Check out this book or BoilingFrog.com, among other sites, for some examples.) Prosecutors make up facts, legislators make it a crime to play poker in your own home, bureaucrats rewrite the laws, logic and the dictionary — and we’re all left at their mercy. The frog is boiling and the water’s getting hotter every day. I pledge to the friends and users of Betcha.com that I will do my part to turn the heat down. If that means rotting in jail, so be it.

Cross-posted from the Betcha.com blog

Washington State Gambling Commission investigators seized computers from a new Seattle-based Internet-betting site Monday, claiming the business violated the state’s 2006 online gambling ban — a contention the site’s founder strongly disputes. [...] “This is ridiculous,” Jenkins said. “I’m going to fight it. I don’t like the heavy-handed state coming down on entrepreneurs.” [...] “This is an honor-based betting platform,” he said. “How can you be gambling under a legal definition if you don’t have to pay when you lose?” [...] After assembling a team of investors and putting his own money on the line, he did a soft launch of the site three weeks ago, “to work on the bugs.” Soon after, he was contacted by the state. Two weeks ago, he explained his legal rationale to commission attorneys. On Friday, the Gambling Commission summoned Jenkins to Lacey to talk about his Web site. The meeting was quick. “They said shut it down or else,” Jenkins said. “I told them the law doesn’t apply to us. They said the law is a matter of interpretation.” The same day, Jenkins filed his lawsuit seeking to stop the state from applying the Internet gambling law to Betcha.com. The search warrant came three days after Jenkins and the state failed to reach agreement on the site’s legal status. He said the commission has lost perspective on which laws it should enforce and upon whom. “When you are a hammer, I guess everything looks like a nail,” he said.

Below is Nick Jenkins’ only recent blog post I spotted on the topic of betting regulations, where Nick does not mention the busting.

Washington Lawyer Seeks to Have State Internet Gambling Law Declared Unconstitutional
By Nicholas Jenkins
Posted on July 09, 2007 @ 21:24:00 ET

Good news out of the Pacific Northwest. Renton lawyer and card player Lee Rousso has filed suit Off Site Link: /northwest/story/125303.html against the State of Washington to have our much-maligned Internet gambling law declared unconstitutional. The gist of his argument: the state’s law is protectionist, and as such violates the Commerce Clause.
I met with Lee yesterday. The guy knows his stuff, and we’ll be watching his case closely. Of course, I’ve long maintained that the gambling laws don’t apply to us because betting on Betcha isn’t gambling. The libertarian in me, however, wants to see this invasive law tossed once and for all. Besides, it’s nice to see someone other than me stand up to the leviathan.

And here’s a prior Nick Jenkins interview on YouTube. WATCH THIS VIDEO, FOLKS. VERY INFORMATIVE.

I wish the best to Nick Jenkins.

Previous Midas Oracle blog posts about Betcha.com.

Law professor Tom W. Bell on Betcha.com.

UPDATE: REPORTS OF THE BETCHA.COM DEMISE HAVE BEEN GREATLY EXAGGERATED.