Some background: on July 6, Betcha.com filed a declaratory relief action against the Commission — we’re asking a court to rule on the legal propriety of the Betcha product. The Commission knew this, but raided our office on July 9, anyway. During the raid, Rick Herrington, the Commission’s Chief Enforcement Officer, told my wife he didn’t know what they’d do with the confiscated items, but didn’t rule out selling them. He also told her that a court’s subsequent decision didn’t matter because he’d already determined that Betcha was breaking the law.

He wasn’t kidding.

On Saturday, I received notice (postmarked July 13) that the Commission was instituting forfeiture proceedings against the property they confiscated in the office raid — several computers, a multi-function printer/fax machine, blank compact discs, computer programming manuals and the like. The Commission is going to sell our stuff.

This is all quite troubling. First, unless you count Mr. Herrington’s “they’re committing a crime” assertion, neither I nor Betcha has been charged with one. No indictment, no judge, no jury, nothing other than Mr. Herrington’s “they’re guilty.” Second, the Commission knows there’s a civil action pending against them. Rather than wait for the court’s determination, however, they’re proceeding unwavered. (If that’s not contempt for the judicial process, I don’t know what is.) Finally, there’s no nexus here between the alleged illegal activity and the property in question. As to the computers, the Commission knows or should know that we purchased them months before we launched Betcha.com, so there’s no chance they were purchased with proceeds from our alleged illegal activity. Nor does the Commission seem to care whether the property was used in the commission of a crime. It’s very difficult to argue, for example, that blank compact discs were used in illegal activity. They are, after all, blank.

(If you’re wondering whether there’s anything we can do about this, the answer is “no.” Under Washington law, the Commission has immunity from liability for any actions they take in furtherance of enforcing the law. That’s not their fault: the Washington legislature created a system that all but invited a Gestapo. The current crew just took the invite.)

This isn’t particularly surprising given the way they’ve played fast and loose with the law. At a hearing on Tuesday, for example, Assistant Attorney General Jerry Ackerman argued in open court that the law entitled the Commission to a liberal interpretation of its laws vis-a-vis Betcha. (The AG’s office does the Commission’s prosecutorial bidding.) Not quite. Insofar as the Commission is entitled to the liberal construction of anything, it is memorialized in RCW 9.46.010, which states that “(a)ll factors incident to the activities authorized in this chapter shall be closely controlled, and the provisions of this chapter shall be liberally construed to achieve such end.” The Commission, however, has argued to the roof tops that Betcha is not authorized by law. How that liberal construction provision applies to Betcha, then, is beyond me.

The Commission’s contempt for the judicial process is rivaled only by its disregard for constitutional rights of Washington citizens. Last year, they busted a Bellingham man for running a web site that included articles about online poker — First Amendment be damned. The bust was based on a law that has been criticized on First Amendment grounds (1|2) and is now being challenged in court on other constitutional grounds. In an article written about that law, Commission Director Rick Day is alleged to have suggested that people who are unsure about putting gambling-related information on their Web site should write the Commission to ask permission.

Citizens asking the government for permission to speak: is that how it’s supposed to work?

None of this compares to the contempt in which they’ve held the rights of Betcha’s investors and employees. They’ve disregarded the well-established constitutional principle that citizens are entitled to read criminal statutes narrowly so that they can determine what conduct is and is not permissible in favor of a principle that amounts to “whatever we say goes.” They’ve shown up at the homes of Betcha employees. They’ve, to be kind, played fast and loose with both the facts and the law. And now they’re going to sell the property they seized from our offices — all purchased with our investors’ cash — without even charging us with a crime!

All of this should be of great concern to Washington residents as well as anyone who has even the slightest fondness for liberty. If the Commission is entitled to a “whatever we say goes” approach — and at least one Commission officer, a foot soldier named Lee Streitz, has told me they are — then we truly have a roving Gestapo on our hands. The Commission makes the law, they adjudicate it, and they mete out the punishment. Today Betcha’s in its crosshairs. Tomorrow it could be anyone in Washington who plays online poker.

All this has we wondering: why bother even having gambling laws in Washington? If the Commission is free to make up its own definitions of the law, and act as though the court system does not exist, then why not just scrap existing law in favor of a simply worded new one: “Whatever the Commission says goes.”

The world has seen such regimes before. The most notorious one ended in 1945.

NOTE: This entry was originally posted on the Nick Knacks blog on Betcha.com. The author can be contacted at nickj at betcha.com.

—

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