Tag Archives: kentucky

Kentucky Supreme Court: gambling domain names did not have standing

Com. ex rel. Brown v. Interactive Media Entertainment and Gaming Ass’n, Inc., — S.W.3d —, 2010 WL 997104 (Ky. March 18, 2010)

Back in 2008 the Commonwealth of Kentucky took an extraordinary step in its battle against online gambling. It filed an action in state court seeking to take over 141 domain names that the Commonwealth believed were used for illegal gambling sites. The trial court ordered forfeiture of the domain names.

Kentucky

Lawyers arguing against the forfeiture of the domain names sought a “writ of prohibition” from the appellate court, asking that court to prevent the forfeiture of the domain names. The lawyers appearing before the appellate court fell into two categories: those purporting to actually represent certain domain names (not the domain names’ owners) and those representing gambling trade associations whose members purportedly included some of the registrants of the affected domain names.

The appellate court granted the writ of prohibition. The Commonwealth sought review with the state supreme court. The supreme court dismissed the writ because those arguing against it lacked standing.

Who’s interest was at stake?

The court noted that only a party with a “judicially recognized interest” could challenge the forfeiture of the domain names. The court rejected the notion that the domain names could represent themselves:

An internet domain name does not have an interest in itself any more than a piece of land is interested in its own use. Just as with real property, a domain name cannot own itself; it must be owned by a person or legally recognized entity.

As for the gambling associations, the court held that there could be no “associational standing” because none of the associations would identify any of their members. Associational standing is when an organization (say, for example, the NAACP or a labor union) files suit on behalf of its members. One of the fundamental requirements of associational standing a showing that members of the association would have the right to sue in their individual capacities. Since there was no evidence as to whose interests the associations represented, there was no basis to conclude that the associations’ members would have standing to sue in their own right.

So the court sent the matter back down to the appellate court with orders to vacate the writ of prohibition. But the supreme court also hinted that those affected by the forfeiture could get another bite at the apple: “If a party that can properly establish standing comes forward, the writ petition giving rise to these proceedings could be re-filed with the Court of Appeals.” One would think that at least one brave soul will step forward. Some in the industry seem to hope so.

Other accounts of this story:

Court enforces forum selection clause in web hosting agreement

Bennett v. Hosting.com, Inc., 2008 WL 4951020 (N.D. Cal. November 18, 2008)

Bennett filed an astounding 30-count complaint against defendant Hosting.com. Though the Managed Hosting Agreement designated Jefferson County, Kentucky to be the sole and exclusive venue for actions brought in connection with the agreement, Bennet brought the action in federal court in Northern California. Hosting.com moved to dismiss for improper venue. The court granted the motion.

Kentucky on a map

The court held that Bennett failed to prove that the forum selection clause in the hosting agreement was unreasonable. The fact that Hosting.com may have had superior bargaining power and the agreement appeared to be non-negotiable was not enough to render the agreement unconscionable. Moreover, Bennett failed to demonstrate how the forum selection clause was against any public policy of California. And the court rejected her argument that the case belonged in California because Kentucky does not recognize certain of the causes of actions in the complaint. After all, a Kentucky court could apply California law.

The court also rejected Bennett’s argument that the forum selection clause shouldn’t apply because a number of the claims arose from tort law and did not involve the agreement. This argument was rejected because many of the tort claims would require the same findings of fact as the contract-related claims. Moreover, and perhaps more importantly, the forum selection clause was broad. All the claims appeared to be “in connection with” the agreement. That was enough in this case to bring them in.

(Missing Kentucky image courtesy Flickr user dog_manor under this Creative Commons license.)

Kentucky settles banned blogger’s First Amendment challenge to Internet filtering policy

Ed. note: This is a guest post by Greg Beck, an attorney at Public Citizen in Washington, DC. Greg works on a variety of issues at Public Citizen, mostly involving Internet free speech, anonymity, and intellectual property. He was lead counsel for Mark Nickolas in his challenge to Kentucky’s ban on blogs. [More info...]

Political blogger Mark Nickolas yesterday settled his lawsuit against Kentucky, in which he challenged the state’s policy of blocking blogs on state-owned computers. The settlement provides that Kentucky will no longer target websites for restriction just because they are blogs, and will instead treat them in the same way it treats other websites with similar content. In other words, classifying a website as a “blog” is no longer a good enough reason to ban a site on the state’s computers.

Nickolas is the owner and primary author of BluegrassReport.org, a blog focusing on Kentucky news and politics and specializing in criticism of former Governor Ernie Fletcher. In 2006, the New York Times quoted Nickolas and noted the blog in an article about Fletcher’s indictment on charges of political corruption. The next day, without warning, the state reconfigured its Webwasher filtering software to block all access to blogs on state computers.

Nickolas filed suit and, represented by Public Citizen, raised two primary arguments that the policy was unconstitutional under the First Amendment. First, he argued that the policy was adopted specifically to target his blog and therefore constituted viewpoint discrimination, the worst form of government action under the First Amendment. Aside from the suspicious timing of the policy, Nickolas relied on internal state email showing that, despite public claims to the contrary, the governor’s office had ordered the ban on blogs and had specifically requested that the URL of Nickolas’s site be added to the “blacklist.” Moreover, Nickolas obtained the declaration of the former state official charged with administering the state’s computer systems at the time the policy went into place, who was told that the decision to ban blogs came from “high up” and was designed to hide the decision to ban Nickolas’s site in “a bunch of other stuff.”

Second, Nickolas argued that, even if the ban were not aimed specifically at his site, the state nevertheless violated the First Amendment by singling out blogs for special restrictions while ignoring other sorts of websites with comparable content. State records showed that the number of hits to news and political blogs from state computers was a small fraction of the millions of hits received each day by mainstream news sites like the Lexington Herald-Leader, the New York Times, and CNN.com. The state could offer no rational explanation for its decision to focus solely on blogs while ignoring other websites reporting the same information (especially since even blogs on mainstream news sites remained accessible). Moreover, Kentucky continued to allow access to many other categories of websites that served no work-related purpose and that received more traffic than blogs, including webmail, newsgroups and message boards, sports sites, shopping sites, financial and stock-trading sites, and others.

The case was the first to challenge a state’s decision to block access to blogs on state-owned computers. The most analogous case is the Fourth Circuit’s en banc decision in Urofsky v. Gilmore, where several Virginia professors sued over a law prohibiting access on state computers to sexually explicit materials. 216 F.3d 401 (4th Cir. 2000). The professors asserted that they needed access to the materials to fulfill their research, writing, and teaching responsibilities. That assertion, however, ultimately proved fatal to the professors’ claims when the court held that, because the professors were performing these duties in their capacities as state employees rather than as private citizens speaking on issues of public concern, their First Amendment rights were not implicated. Urofsky‘s reasoning suggests that if the professors had instead relied on restrictions to their personal use of state computers, the court would have evaluated the law’s constitutionality under the Supreme Court’s decision in Pickering v. Board of Education, 391 U.S. 563 (1968). Pickering and a line of cases following it established a balancing test for determining the constitutionality of a government’s restrictions on its employees’ speech, weighing the employees’ First Amendment interest in access to the restricted materials against the employer’s interest in maintaining order in the workplace.

Unlike the professors in Urofsky, Nickolas did not challenge the state’s restrictions on what employees could read pursuant to their job-related responsibilities. Kentucky, like many other employers, had long allowed its employees to use state-owned computers for personal as well as work-related purposes as long as that use did not interfere with performance of job responsibilities. Pursuant to Kentucky’s policy, employees could and frequently did read online news sites, including blogs, from workplace computers. The state’s decision to block access to the blogs while still allowing access to other news sites imposed on its employees its own preferences about which sources of news were acceptable and which were not. Nickolas argued that, even if the state had the power to entirely ban personal use of workplace computers (a proposition that Nickolas did not dispute), it did not have the power to selectively allow access to only those news sites it approved as sources of news. It was simply not a proper role for government, Nickolas argued, to decide which websites were legitimate news sites and which were not.

In the settlement finalized yesterday, Kentucky reserved its right to regulate use of computers in the workplace, but agreed to do so in a viewpoint-neutral manner that treats blogs the same as equivalent non-blog websites. Although a decision on the legality of blog-banning policies will be left for another day, the case should at least cause public employers to think twice before cutting their employees off from a large and important piece of the online political discussion.