Click the link for the “Full Tilt Poker Sold” page to read a detailed analysis of the Wicked Chops report.
If WC is right, this is very good news for us, and means the investor deal to recapitalize Full Tilt is going forward.
This is the players’ complaint. In short, the lawsuit makes the claims the DOJ made in its criminal and civil forfeiture claims–that Full Tilt was engaged in an organized crime scheme to defraud banks and launder money. It is a claim for repayment of player accounts and for damages under the RICO act.
The players who filed this lawsuit fucked up pretty badly. There is no way this lawsuit can be anything other than counterproductive, given the news reported by the Los Angeles Times (and now independently reported by the Wall Street Journal) that a group of European investors have purchased control of Full Tilt.
Fortunately, it is unlikely this lawsuit will have any effect on the situation. If we do have investors, payouts are likely to get underway long before this lawsuit can be moved beyond the preliminary complaint, service on defendants and answer stage. It will very likely become a moot point.
The players who have filed the lawsuit are:
Steve Segal (probably not the actor, lol), Nick Hammer, Todd terry and Robin Hougdahl. If any of you know any of these morons, or happen to run into them at the mall or the WSOP, tell them for me that they are a bunch of blithering idiots.
As I have mentioned on 2+2, there is an unsourced rumor floating around in NVG that BWin (Party) is the party to whom Full Tilt sold control.
I’m not sure I believe that, but if it is true, it is a good news bad news situation for players.
It is good news in that BWin is a big, publicly traded corporation that has (or can easily acquire) the assets and liquidity to pay US players pretty effortlessly.
It is bad news because, as a publicly traded corporation, BWin will probably have to jump through some time consuming hoops to get the deal approved. So we could be in for a long wait if it is actually BWin to whom Full Tilt Poker sold control.
Now I’m just going to brag a bit. In the QuadJacks thread saying Binion had invested in Full Tilt, this is what I wrote 10 minutes before the LA Times story broke:
The far better option for an investor is to discuss the acquisition with the DOJ. DOJ is likely to settle for a lesser amount of money if it results in players being made whole and the current owners of FT being kicked out of the company.
In fact, such a sale would probably be structured as
Investor: “I, white knight, agree to pay X for ownership of FT, sale price to be paid to the United States in settlement of its case against FT’s owners.”
FT: “We relinquish to white knight all right, title and interest in everything relating to FT in settlement of the case against us.”
US: “We agree to dismissals of some combination of the criminal and civil cases, and maybe we will speak kindly of the white knight to future US poker regulators considering his license application.”
Obviously bare bones silliness above, lots of other things the parties would be negotiating. Main point being that under the circumstances, an investor is pretty likely to be paying the sale price to the US, not the FT owners. If i were investing, that’s what I’d be shooting for.
I don’t usually just brag, but I am pretty pleased that I more or less nailed the structure of a deal being secretly negotiated. The LA Times article says pretty much what i said the deal would look like:
Attorneys associated with Full Tilt said the company signed an agreement Thursday with a group of investors who would put up enough money to pay back players and in doing so attain a majority stake in Full Tilt’s Irish parent company, Pocket Kings. The attorneys spoke anonymously because of the sensitivity of ongoing negotiations with the federal prosecutors in Manhattan who brought the charges.
The money is also intended to allow the company to settle a civil lawsuit brought against it by the U.S. attorney’s office at the same time as the criminal indictment, the attorneys said.
As I said would happen, the investors made sure that the DOJ was involved in the talks. refunding players seems to have been an explicit condition of the deal, and it looks like the deal is being negotiated within the framework of the civil and criminal cases against the Full Tilt owners.
If anybody is wondering who the LA Times’ source is, it is pretty clear that the ultimate source is Howard Lederer. Here is why I think that:
1. It was the LA Times that broke the story;
2. Tiltware is based in California.
3. Howard is probably the only one in Tiltware with the authority to cause the story to be leaked.
4. The actual source were “lawyers associated with Full Tilt.”
5. An attorney told to leak a story will leak it to a local reporter he knows.
All of this adds up to Lederer telling his attorneys in LA to leak the story to the press, and the attorneys calling the LA Times.
Obviously the report is excellent news for all US players.
Folks on 2+2 are incorrectly crediting the Alderney Gambling Control Commission with forcing this deal by suspending Full Tilt’s e-gambling license yesterday. This is wrong. There is simply no way that this deal got put together in the 30 or so hours between the suspension and the news report today.
A better theory that credits AGCC more or less equally is that AGCC gave Full Tilt a June 29 deadline to have a plan in place to pay back players, and FT blew the deadline by a little bit. The suspension probably caused news of the deal to leak more quickly than FT intended, but it didn’t cause the deal to happen. This deal was necessarily in the works for a long time–at most the suspension affected the timing of the leak we see in the LA Times story.