June 28, 2010

The PPA & Its "Money Bomb" Are Duds

"Son, you're about as useful as a poopy-flavored lollipop!"

—Patches O'Houlihan (Rip Torn), in "Dodgeball: A True Underdog Story"
Yesterday I was listening to a PokerRoad podcast when I heard an ad by Greg Raymer (at the ~9:45 mark) for the Poker Players Alliance (PPA).  The ad was a generic "join the cause" effort:
Hi, I’m Greg Raymer, and I’m a member of the Poker Players Alliance.  Poker has a target on its back, and we need your help to protect the game we love.  The PPA is the single most effective tool poker players have in the fight to defend this great American pastime.  That’s why I’m a member of the Poker Players Alliance. … Every member counts, so join the Poker Players Alliance now to help in the fight to protect your right to play poker in America.
Intrigued, I looked over the PPA website, trying to get a sense of how membership fees are put to use.  Of course the benefits of "premium" membership sell themselves—a card protector, a window decal, and the "ability to donate to the Poker PAC".  Wow, I can pay for the right to donate more money?  Sign me up!

Well, before I donate money to a PAC, I like to make sure it is effective.  Surprisingly, I found little evidence of any real accomplishments by the PPA.  The calendar of PPA events is literally blank except for an upcoming poker tournament to benefit the Ante Up for Africa charity; certainly a worthy cause, but not something I really need the PPA to facilitate.  The vast majority of the PPA discussion forums have grown cobwebs from disuse.  The PPA makes references to lobbying Congress, but gives no details as to its efforts or any tangible results.  Of course, there is also reference to the PPA's role in several state poker legalization lawsuits, failing to point out that its few victories were Pyrhhic, violating the principle of "Primum non nocere"—"First, do no harm."*  So, in sum, I'm not certain that the PPA has really accomplished much, if anything, to this point.

While on the PPA website, I found it interesting that the PPA has designated July 1, 2010, as the date for a "money bomb", looking to raise $25K or $50K from its members, depending on which PPA message you find.  Purportedly, the PPA wants the money to help its lobbying efforts with Congress this summer as various poker legalization schemes are debated.  But the only thing relevant to lobbying is whether a lobbying group is able to deliver votes or money to Congressmen and Senators.  Let's face it, the PPA might have the "million members" it claims, but those members are hardly motivated single issue voters; i.e., PPA members are not likely to be a voter base that can be reliably mobilized in any election.  Also, the voters need to be people who can vote for Congressmen and Senators who matter—those with influential committee or leadership positions, or who are on the fence on the issue—so having a bunch of members nationwide is really irrelevant to getting a Congressman or Senator from a particular district or state to vote for your issue, if there aren't many of their voters in the organization.  So, the other option is money, and in the grand scheme of federal lobbying, $25K to $50K is chump change.  The money the PPA is raising might keep the lights on—or Senator D'Amato on board as lead lobbyist—but it really won't have much effect on lobbying per se, particularly since most of the money is likely to go to the PPA itself, rather than to Poker PAC.

One also has to question how effective the PPA can be at the lobbying game, given that three of its leading spokespersons (and members of its Board of Directors) are either associated with PokerStars (Greg Raymer) or are owners of Full Tilt (Howard Lederer and Chris "Jesus" Ferguson).  The issue is not that any of these men have been accused of any personal wrongdoing (though there is that rumored Full Tilt federal grand jury lurking out there), but that they are closely linked to the two biggest online poker sites, sites that are associated with several recent money laundering arrests, and which openly operate in the United States despite state laws against gambling, and with apparent disregard for the UIGEA.  One has to wonder how many legislators will want to be associated, even indirectly, with Full Tilt and PokerStars.

The PPA's close association with prominent members of Full Tilt and PokerStars also raises serious questions about potential conflicts of interest.  As background, keep in mind that Harrah's and MGM are now aggressively lobbying for legalization of online poker.  However, their vision of legalized online poker encompasses regulatory restrictions on companies that are currently operating in violation of U.S. laws, including the industry heavyweights, Full Tilt and Poker Stars.  As industry expert Bill Rini describes the Harrah's/MGM scenario:

Any legalization of online gaming will come with a regulatory body who will determine who can and cannot offer gaming to US citizens. One of the big assumptions at the moment is that because PartyPoker paid a fine that they are clean. Actually, part of the settlement was an admission of guilt. That admission may come back to haunt them if companies like Harrah’s lobby for licensing requirements that state that any company allowed to offer gaming cannot have illegally offered gaming previously. It’s a perfectly logical requirement and one that many people would agree with so I don’t think it would be too difficult for a land based casino to attempt to get it inserted into any licensing requirements.

In reality, I would be very surprised if any of the current top online poker rooms ever get a license to operate in the US. If I was Mitch Garber running Harrah’s online division I would pump as much lobbying money as it took to make sure that the licensing requirements were sufficiently stringent that all existing online poker sites would be disqualified.

[more from Bill Rini on the topic HERE and HERE.]
Dan Michalski over at Pokerati.com has a similar take on poker lobbying efforts and the Harrah's/MGM likely battle plan for online poker legalization:

Now the purpose of the American Gaming Association’s shift in policy stance is becoming a bit clearer. Considering that they’re the representative voice for B/M casinos, you can see a plausible plan taking shape:

1. Let the UIGEA go into full effect June 1.
2. Eliminate the most powerful online poker operators currently in the industry (i.e., Tilt and Stars).
3. Pass a new law.
4. Let Harrah’s, the Sands, and MGM/Mirage set up shop.
5. Then let the European poker sites join the party.

Step #2, of course, is the billion-dollar mystery question that could dramatically affect us all. Howard Lederer and family have been doing their best to line political pockets with campaign contributions for the past few years … but there’s only so much you can do as an individual when you don’t have an American corporation to funnel your campaign finances through.

[Michalski also linked to a report showing Sen. Harry Reid's top contributors for the 2010 election cycle, with MGM as top donor with $180,400 in total contributions, while Harrah's was second at $111,950].
This scenario for online poker legalization took an ominous step forward recently when the Nevada Gaming Control Board issued an advisory opinion indicating that "those internet companies that have not complied with state and federal law, especially after the passage of UIGEA, and have demonstrated no interest in voluntary compliance will be looked upon less favorably" by the NGC in evaluating whether a company would be granted a gaming license. 

So what does this all have to do with the PPA, and where is the potential conflict of interest?  Well, the PPA's mission statement is a generic, broadbased advocacy for online poker legalization, without regard for the interests of any particular company:

The PPA’s mission is to establish favorable laws that provide poker players with a secure, safe and regulated place to play. Through education and awareness the PPA will keep this game of skill, one of America’s oldest recreational activities, free from egregious government intervention and misguided laws.
If the rank and file of PPA members were told that online poker would be legalized and regulated in the United States within a 12-18 month timeframe, I suspect most of them would be in favor of such legislation.  Now, assume that the legislation were drafted in the Harrah's/MGM-favorable mode discussed above, which would effectively shut out of the market current foreign-based online poker sites, such that the only legal options for online poker—and the easiest options for fully legal deposits and withdrawals—were new sites started by Harrah's, MGM, the Sands (Venetian), and the Wynn.  Do you think most online poker players would care if they had to make the switch, particularly if the softest competition—new players—overwhelmingly flocked to the new legal sites?  So, what's good for online poker players in general and the PPA members in particular might well be directly at odds with what's best for Full Tilt and PokerStars.  Yet three of the major PPA decision makers** have a direct interest in the continued success of Full Tilt and PokerStars, and it's no secret that the PPA's political fundraisers are heavy in major Full Tilt and PokerStars players.  Feeling conflicted yet?

Now, a cynic might wonder why, if the PPA really needs $25K or $50K, PokerStars, Full Tilt, and Ultimate Bet don't just pass the hat among their "teams", "pros", "friends", and other quasi-affiliated menageries; surely they can raise that amount in just a few prop bets.  In fact, a cynic might wonder why the PPA is seeking to raise a mere $25K or $50K in dribs and drabs from its rank and file members, when the PPA already spent north of three-quarters of a million dollars on lobbying in the first quarter of the year alone; a cynic might wonder if the PPA is merely used by Full Tilt and PokerStars to give a patina of populism to their lobbying efforts.  A cynic might wonder if established sites like PokerStars and Full Tilt regard the PPA as a convenient fig leaf to cover their use of the PPA as a de facto lobbying arm, avoiding the legal complications of being foreign companies with significant lobbying restrictions.  A cynic might wonder if the PPA is the political perfume used to cover the stench of lobbyists and campaign donations being funded by companies who currently flout U.S. gambling laws.  Frankly, given the tenor of the PPA's litigation and lobbying efforts, a cynic might wonder if the PPA truly wants legalized online poker if it doesn't include a Get Out of Jail Free card for established online poker sites.

Color me cynical.

They even look "poopy", don't they?

* Although I have addressed the failings of the poker litigation strategy a few times (notably HERE and HERE), my most recent post on the topic sums up the downside to pursuing a flawed legalization-by-litigation strategy:
By tilting at the litigation windmill, poker advocates have instead worsened the position of poker. There are now binding appellate court decisions in several states explicitly finding that poker is gambling. These rulings reinforce in the public mind—with the imprimatur of judicial decisions—that poker is gambling, while also removing any arguable ambiguity as to the legality of poker (and online poker) for players in those states.
**  Greg Raymer's role as essentially an endorser and spokesperson for PokerStars makes his role in the PPA exponentially less problematic than Ferguson and Lederer, insofar as Raymer does not (to my knowledge) hold a major ownership position in PokerStars.

June 27, 2010

Mind Reading at the Meadows

You were lookin' for that third three, but you forgot that Professor Green folded on Fourth Street and now you're representing that you have it.  The DA made his two pair, but he knows they're no good.  Judge Kaplan was trying to squeeze out a diamond flush but he came up short and Mr. Eisen is futilely hoping that his queens are going to stand up.  So like I said, the Dean's bet is $20.

—Mike McDermott (Matt Damon) in "Rounders"

Last night I snuck away for a short session of Poker! at the Meadows ATM.  I ran into an early cooler when my deuce-four of crubs was snapped off by absolute trash.  The board ran out 4-4-8 / 2 / 9, and we got it all in on the turn, where I discovered I was drawing dead against 8h4h.  I expected Poker Grump to promptly remit my "Deuce-Four Cracked" promotional rebate, but was rather disappointed by his response:

@grange95 I got you a full house. If you can't win with it, that's your problem. #noskill #lackoffaith #whiner


Seriously, this wasn't some standard bad beat story, my freakin' deuce-four of crubs, arguably the strongest hand in poker, got cracked by some yahoo playing rags!  It's so improbable it deserves a little venting, particularly after Poker Grump posts all that propaganda making the deuce-four seem invincible, as if all you need to do is get dealt the hand and watch the chips roll in.  In my best Penn Jillette impersonation, I officially call "Bullshit!" on the myth of the deuce-four.  Harrumph!

However, crAAKKer is not built around whining, at least not my own.  So we move along to the real point of this post.  After rebuying, I built up a nice stack of ~$800.  No real big hands, just a couple of nice squeeze plays and value-betting my good hands to death.*  Toward the end of my session, a regular named Brian sat down at our table.  Brian is probably late 20s, nice guy, and a very solid poker player whose game I respect.  One of the top 10 biggest pots I've ever lost was to Brian in a 2/5 NLHE game where I flopped a set of Yaks against his set of Queens; I swear, I came this close to laying the hand down, but I'm just not that good of a player.

In any event, I wasn't looking to play big pots with Brian if at all possible, particularly after he built up an equally large stack in under an hour.  However, a pot came up where we had a small clash.  I was on the button, and five or six layers limp to me.  I find black 9s, and raise to $17, a little on the steep side, but much less would get a cascade of callers.  It folds to Brian who calls, and we go to the flop heads up:  Ks-Js-6c.  Brian checks, I c-bet $30, Brian calls.  Turn is the Ts.  Brian leads out for $50.  I tank, trying to think of a hand I could beat.  After I had thought a bit, I looked back at my cards as if checking for the As, to try to get a read, and maybe make a move.  Brian suddenly says, "Pocket 9s are no good."  I just laughed and said, "In that case, I guess I have to fold" and mucked face up.  Brian laughed and said, "Wait, pocket 9s were good!"  I honestly don't know if I was ahead, behind, live, or dead, but I was happy to get away for minimal damage.  After all, there's always a better place to get it in bad!

I see your Aces getting crAAKKed.


* I did get black Aces under the gun (my only AA of night), so I limped, and of course, this was the one unraised pot that orbit.  Anyway, I manage to turn pocket rockets into a crub flush draw.  Obviously, crubs got there, so I did win a decent pot, despite my incompetence.

June 25, 2010

Friday Fun (v. 1.6)—
Cougars Eating Unicorns at Bacon Camp

Via the Freakonomics blog, here is a list of some great Google "Easter Eggs".  The ninja is pretty sweet (aren't they always?), but my two favorites are the "Did You Mean" results when searching for "recursion" and "anagram".  Try it out!  You know you will ....

* * * * *
Although I Twittered this link during the week, it is such a classic example of lawyers without humor that it deserves a re-mention here.  The lawyers at the great mega-firm, Faegre & Benson, sent a "cease and desist" letter to the folks at ThinkGeek on behalf of their client, The National Pork Board.  The good lawyers were defending their client's trademark slogan, "Pork: The Other White Meat" against infringement by ThinkGeek in its sales of .. wait for it ... canned unicorn meat

* * * * *
Speaking of processed meats, there was no major sausage-related news this week, but Neatorama.com did pass along two important meat-related stories.  First, the Friendly's Burger chain is now offering a hamburger ... served between two grilled cheese sandwiches.  Home cooking tip:  if you're out of hamburger buns, grilled cheese sandwiches will do nicely in a pinch. 

Second, the Washington Post reported on the perfect summer activity:  Camp Bacon.
The sun shone brightly as the couple sat down to breakfast under a big white tent. Their plates were piled high: with hickory-smoked bacon from Edwards of Surry, Va.; long pepper bacon from Arkansas' Ham I Am; and applewood-smoked bacon from Nueske's in Wisconsin; plus bacon scones and a slice of bacon-apple coffee cake for good measure.
Mmmmm, bacon scones!  The report also mentioned prosciutto and pancetta from La Quercia, a small Iowa company.  Trust me, this stuff is amazing!

* * * * *
In an all-time classic "D'Oh!" moment, a North Carolina fisherman lost a $912,000 prize after catching a prize blue marlin, because one of his crew didn't have a fishing license.  The cost of the license?  Five bucks.  The look on the captain's face after the disqualification?  Priceless. (C'mon, it had to be said!).

* * * * *
In our international relations, multi-cultural cool video of the week, check out these South Korean student sports fans, who apparently have too much time on their hands and need to be introduced to tailgating:

* * * * *
Finally, it appears that Orangina, the curiously suggestive soda from France, is marketing its product to cougarsLiterally.  Or maybe I just misunderstood this TV ad from its new ad campaign (some amusing short ads; check out the Panda and Rasta-Lion):

June 24, 2010

Kiwi-Scented Irrational Exuberance

Yesterday, news broke that a New Zealand judge had ruled that the poker tournaments are not covered by gambling laws, and that ads for free ".net" poker sites are not advertising for gambling.  PokerNews.com had the first and best coverage that I saw (a sentiment apparently shared by a large number of other poker sites that appeared to borrow or copy extensively from the PokerNews story).  Unfortunately, I have not been able to locate a copy of the decision itself online, so I can't really add any meaningful analysis beyond the points noted by PokerNews:

■   The pokerstars.net website is not promotion of a gambling operator, promotion of gambling overseas, or likely to induce New Zealanders to gamble overseas.

■   The pokerstars.net website is not a gambling website nor is it synonymous with pokerstars.com.

■   The APPT is not "gambling" in terms of the Act because it is a competition, with an entry fee, which has prize money at the end of it (as opposed to the payment of consideration, based on the outcome of the game).

The first two points are really not about the legality of poker, so much as it is about what is and is not covered by advertising law.  In fact, if poker were not regulated as gambling, then there would be no need to analyze the difference between free and real money online poker sites.

The third point is a little more interesting.  As 2+2 poster "Skallagrim" stated:

The opinion, from what little I can read of it in the linked article, is not a "skill v. chance" opinion so the relative variance of tournaments or cash games did not come into play.

What this judge essentially ruled is that the format of a tournament makes it different from gambling. He notes that winnings are paid from a set amount of entry fees paid by the players and that no one not playing gets any share of the pool.

Ultimately he is applying the "bone fide contest" exception which frequently appears in US law too. In other words, if you put up money on whether Tiger Woods wins the golf match, thats gambling; if you pay an entry fee and participate in the game/contest, thats not gambling.

So again, this ruling does not seem to signal a legalization of poker in general, though poker tournaments, properly structured, may be able to avoid regulation under New Zealand gambling laws.

I was able to do a little research into the New Zealand justice system, and found that it is structured similarly to the justice systems found in the United States at the federal and most state levels.  Essentially, then, the court decision this week really has limited impact for a number of reasons.  First, it is a decision of the lowest level court, and thus is not binding on any other court.  Second, the decision is subject to appeal, and as has been seen in the United States, appellate courts tend to be much more hostile to poker advocates than the occasional friendly district court judge.  Third, the case will almost certainly never have any impact on U.S. law, though I certainly don't begrudge our Kiwi poker friends their victory.

In terms of applicability to U.S. law, the poker legalization trend seems to be running the opposite direction of the New Zealand ruling.  Nobody in the U.S. seems to be seriously contesting that poker tournaments are not regulated under gambling laws.  As for the key advertising portion of the ruling about ".net" sites, the Nevada Gaming Commission recently signalled that it takes a dim view of ".net" advertising, particularly when it is too closely linked to real money ".com" sister sites; the upshot of the NGC's position was to force the Venetian to dump its connection to the NAPT.

So, even though the court's ruling won't likely cause even a ripple in the United States, it's definitely a great week to be a poker player in New Zealand.  Heck, with that beautiful country, not to mention their amazing vineyards, it's always a great day to be a Kiwi!

D-Bag O' the Day (v. 1.13)—
The Burger Menagerie

Jules:  Looks like me an Vincent caught you boys at breakfast. Sorry about that. Whatcha havin'?

Brett:  Hamburgers.

Jules:  Hamburgers! The cornerstone of any nutritious breakfast. What kind of hamburgers?

Brett:  Ch-cheeseburgers.

Jules:  No, no no, where'd you get 'em? McDonalds? Wendy's? Jack in the Box? Where?

Brett:  Big Kahuna Burger.

Jules:  Big Kahuna Burger. That's that Hawaiian burger joint. I hear they got some tasty burgers. I ain't never had one myself. How are they?

Brett:  They're good.

Jules:  Mind if I try one of yours? This is yours here, right?

[Picks up burger and takes a bite]

Jules:  Mmm-mmmm. That is a tasty burger. Vincent, ever have a Big Kahuna Burger?

[Vincent shakes his head]

Jules:  Wanna bite? They're real tasty.

Vincent:  Ain't hungry.

Jules:  Well, if you like burgers give 'em a try sometime. I can't usually get 'em myself because my girlfriend's a vegetarian which pretty much makes me a vegetarian. But I do love the taste of a good burger. Mm-mm-mm. You know what they call a Quarter Pounder with cheese in France?

Brett:  No.

Jules:  Tell 'em, Vincent.

Vincent:  A Royale with cheese.

Jules:  A Royale with cheese! You know why they call it that?

Brett:  Because of the metric system?

Jules:  Check out the big brain on Brett! You're a smart motherfucker. That's right. The metric system.

—Pulp Fiction* 

Our D-Bag du Jour is Cameron Selogie, restauranteur from Phoenix.  Mr. Selogie has found an interesting way to "honor" the World Cup:

We thought that since the World Cup was in Africa that the lion burger might be interesting for some of our more adventurous customers.

That's right, Mr. Selogie's culinary creativity apparently tends toward the ridiculous, as he believes it is A-OK to serve lion meat, because lions are "protected, not endangered" and the meat comes from a lion raised on a farm in the U.S. 

Now, I grew up on a farm that raised cattle and pigs, and I was active in 4-H and FFA, showing livestock of all types at fairs.  I was even on livestock and meat judging teams (trust me, that was a big deal in west Nebraska).  Although I've never butchered an animal other than a deer, I've toured a number of meatpacking plants, and my family (good Germans) made sausage every fall from animals we raised and took to the local butcher shop for processing.  My family was a hunting family, and even though I've given that sport up years ago, my brother and father still hunt, and I still enjoy the meals made from the pheasants and deer they shoot.  I've also eaten and enjoyed a fair number of more exotic meats (e.g., ostrich, bison, rabbit, snake, elk).  And, I'm a big lover of grilled meat.  So, I'm not some soft-hearted vegetarian (not that there's anything wrong with that!). 

That all being said ... LION?!?  Seriously?  Out of all the creatures we eat, lion really crosses the line.  I know our eating choices are somewhat arbitrary, but the fact is, we do draw distinctions—tuna is OK, dolphin is out; Bambi is OK, Fido is taboo.  I would like to think that we can draw the line with the noble, graceful, and intelligent cat family safely on the "DO NOT EAT" side.


* ADDENDUM (25 June 2010):  As an anonymous commentor pointed out, this post cried out for a Pulp Fiction quote in the lead off spot.  This embarrassing oversight has now been rectified.  I apologize for the error.

June 23, 2010

Poker Intuition—Going With Your Gut

How often are you at the poker table when you get a "gut feeling" that a player either has a monster hand or is bluffing?  Maybe you're in the hand, maybe you're just watching, but somehow, you just know that player's hand.  And, how many times have you started thinking more about the situation, and analyzed the hand until you convince yourself that your gut feeling is wrong?

Turns out, there's a scientifically valid reason to go with your gut instinct—the psychological concept of meta-cognition.  Meta-cognition is described as "thinking about thinking" or "feeling about knowing".  Meta-cognition is a self-awareness that you know a fact, without actually recalling that particular fact.

Meta-cognition is in the news this week because of an IBM computer named "Watson".  Watson is a project to develop artificial intelligence algorithms by training a computer to compete at the game show Jeopardy.  Watson essentially runs thousands of different kinds of searches on a vast array of textual data in its memory, attempting to draw necessary connections between different concepts to arrive at a correct answer to a trivia question.  The interesting thing about the Watson project is that Jeopardy questions often involve complex wordplay that is easy for a human brain to decode, but difficult for a binary computer processor to analyze.  Watson has had spectacular successes and equally spectacular failures, but it seems to be ready for its upcoming showdown in a real Jeopardy match.

So what does Watson have to do with poker?  An interesting finding from the Watson research is that human players have one inherent advantage over a computer—the ability to buzz in to answer the question without knowing the answer (or having the answer at immediate recall).  Instead, human players merely "know that they know" the answer and buzz in, trusting this gut feeling, and relying on their ability to actively remember the relevant fact within the time allotted.  Most of the time—in fact, an overwhelming amount of the time—the gut feeling is vindicated and the data is recalled correctly.

Jonah Lehrer at The Frontal Cortex delves into the meta-cognition phenomenon:

These feelings of knowing illustrate the power of our emotions.  The first thing to note is that these feelings are often extremely accurate.  The Columbia University psychologist Janet Metcalfe, for instance, has demonstrated that when it comes to trivia questions, our feelings of knowing predict our actual knowledge.  Think, for a moment, about how impressive this is:  the metacognitive brain is able to almost instantly make an assessment about all the facts, errata and detritus stuffed into the cortex.  The end result is an epistemic intuition, which tells us whether or not we should press the buzzer.

The second important feature of these feelings of knowing is their speed.  As Thompson makes clear, it's the speed of these inexplicable hunches that allow the human contestants to defeat Watson.  Although our meaty computer only requires 12 watts of electricity—we are a damn efficient information processing device—we're still able to react before the supercomputer, which requires a massive air-conditioner to cool itself down.  In the human brain, these primal emotions have been bootstrapped to self-awareness, so that many of our feelings are short, speedy summaries of our own vast hard drive.  They are what urge us to raise our hand, or keep on trying to remember a name, or press the buzzer.

In other words, what we often refer to as "gut feelings" are actually our brain's signal that we in fact know the answer to the problem confronting us.  We may not be able to articulate the precise answer without further thought and reflection, but we nonetheless do know the correct answer.  In poker, based on our experience and knowledge of the game and players, our gut can often tell us our opponent is strong or weak, without our being able to explain that conclusion in analytical detail.  With some thought, however, we can probably point to factors that led us to that conclusion—the bet size, the board texture, the action on prior streets, how the player is acting, etc.  So next time your gut tries to tell you something, make sure you listen.


For those of you interested in the IBM Watson project, here's an interesting video summary, including some footage of Watson in action during training rounds against former Jeopardy champions:

June 22, 2010

Shaun Deeb Should Play Gay ... Bingo!

While catching up on my Google Reader poker blog feeds today, I learned some appalling news via Pokerati.com—the Trump Taj Mahal in Atlantic City is hosting a gay bingo night!  You read that correctly, those bastahds are brazenly targeting a bingo night towards gays.  Seriously?!?  As a gay man, I find this utterly offensive.  We aren't back in the 1950s, or even the 1970s anymore.  Bingo is no longer a game where only Catholics or women over 50 excel.  Elite bingo players come from all walks of life—old men, cougars, Episcopalians, and yes, even a few gays.  Now these groups are certainly minorities in the upper echelons of the game, and historically have not fared as well as the hardcore older Catholic women players, but I find it insulting that any casino markets a sexually restricted event to gay bingo players.  The Taj Mahal might as well be saying, "Gays just can't compete at bingo."  Now, it's true that many gay bingo players find traditional bingo halls an intimidating place, filled with legions of hardcore bingo players with their polyester pant suits, bad dye jobs, and chunky jewelry, grooving to Rat Pack classics on their iPods.  But gays will never improve at bingo if they are sheltered from the rough and tumble world of an open bingo scrum.

I intend to protest the travesty of this Taj Mahal gay bingo event by not playing in it.  In fact, the Taj Mahal will not see another dime of my money so long as they offer gay bingo and I live in Iowa.  However, I fear my personal boycott of the event will not bring sufficient publicity to this grave injustice.  So, I propose that famed gender equality warrior Shaun Deeb be recruited to crash the event.  As a straight bingo player, Deeb could stand up for the rights of all people, regardless of sexual orientation or fashion sense, to play bingo free from discrimination.  To make his point even more forcefully, Deeb could dress gay*—some highlights and product for his hair, a shiny synthetic fiber shirt, and a fabulous jewel-tone colored belt and shoe combo would really drive home the message that it is unfair to straights and gays alike for casinos to sanction gay-themed bingo competitions.

Please help me recruit Shaun Deeb to be a champion once more for sexual equality.  Let this post serve as a petition to draft Shaun Deeb to be the poster boy for the Democratic Bingo Alliance of Gays & Straights (DBAGS); leave a comment below to show your support for this noble cause.  Gay and straight bingo players everywhere deserve a worthy hero to lead this important fight for sexual equality.

*  Below are some possible gay outfit choices for Deeb:

Relax!  Don't do it, when you want to .... BINGO!

June 21, 2010

ET vs. Hannibal Lecter—Heads Up for Rolls!

Hannibal Lecter:  First principles, Clarice.  Simplicity.  Read Marcus Aurelius.  Of each particular thing ask:  What is it, in itself?  What is its nature?  What does he do, this man you seek?*

Clarice Starling:  He kills women.

Hannibal Lecter:  No.  That is incidental.  What is the first and principal thing he does?  What needs does he serve by killing?

Clarice Starling:  Anger, um, social acceptance, and, uh, sexual frustrations, sir ...

Hannibal Lecter:  No!  He covets.  That is his nature.  And how do we begin to covet, Clarice?  Do we seek out things to covet?  Make an effort to answer now.

Clarice Starling:  No. We just ...

Hannibal Lecter:  No. We begin by coveting what we see every day.  Don't you feel eyes moving over your body, Clarice?  And don't your eyes seek out the things you want?

The Silence of the Lambs

I have often thought of this movie scene when confronted by one of poker's extreme playing styles—the calling station.  When confronted with an uber-calling station—an ET, if you will—the standard poker advice is:  "Never bluff a calling station."  Why not?  Well, what do calling stations do?  They call.  Clearly, an opponent calling is a poor result if you are bluffing.

Although this is sound advice, the tactical analysis is misplaced on the proper response to calling stations, without focusing on the reason calling stations call.  Calling is regarded as an independently meaningful action, a product of rational thought, when it is actually a mere reaction, a manifestation of a player's underlying psychological state.  A calling station isn't calling because it is a logically sound play.  Instead, a calling station calls because something in his nature makes him call excessively, to his detriment.

But why should we care why an opponent is a calling station?  Because knowing the underlying reason for excessive calling can help us tweak our tactics at the table to maximize our value from these players.  Consider these different psychological types of typical calling stations:
  • Donkey Calling Station—The classic calling station, this is the player who calls because he has an irrational fear of folding a winning hand.  The Donkey calls preflop with marginal cards, because if he folds and the flop would have hit him with two pair, trips, a straight, or some other monster hand, he feels he has made an error.  Postflop, the Donkey calls with any draw or pair, because he fears if he folds, his hand will improve to a monster.  On the river, the Donkey calls because he is afraid of being bluffed.  Being bluffed means you were hoodwinked, and the Donkey fears looking like a fool; losing a pot is not just losing money, it's losing faceA Donkey calls out of fear. 

"Oh well, maybe he's bluffing again." 

  • Scrooge Calling Station—This is a slightly different kind of donkey, usually a decent to good player who has allowed catching a string of bad hands or being slapped around by a table bully to alter his natural style of play.  The Scrooge calls preflop with a wide range of hands, because he has seen his premium hands lose to "junk", and he is desperately trying to connect with flops to get some momentum rolling; surely this is the hand that turns it all around and gets his money back.  Postflop, when the Scrooge connects with the board at all, the Scrooge eschews betting and raising because he is afraid of building a big pot he will only lose, or because he is afraid he will get raised back and be forced to lay down his hand and give up his investment.  The Scrooge also calls much more loosely than he usually would, because he is looking for a reason, any reason, why he might win the pot just this one time—just this once, his opponent won't have pocket Aces, an overcard won't flop, he'll catch his draw, or his middle pair will pick off a bluff.  The Scrooge is calling solely because of the money; he can't lose every hand, can he?  A Scrooge calls out of greed.

    "Call big or call home!"

  • Hero Calling Station—This player should be regarded as a particularly aggressive caller.  Although that concept may be a bit counterintuitive, the Hero is not calling out of fear of being bluffed, but because he enjoys picking off bluffs.  Preflop, the Hero calls with a wide range because he expects to outplay you postflop, rather than beating you with a better hand.  Postflop, the Hero is not a player who upon occasion analyzes a hand and concludes he is most likely up against a bluff.  Rather, the Hero is a player who actively seeks opportunities to strut his stuff like a poker peacock, calling big bets with bottom pair or King-high just to show off his superior poker hand-reading ability.  The Hero loves to "put players on a hand" he can beat—Ace-King, busted draws, "air"—and will often go to extraordinary lengths to rationalize making a spectacularly thin call.  A Hero calls out of hubris.

Each kind of calling station requires a slightly different response.  Preflop, if you are playing a relatively tight style with good starting hand selection, you should raise more liberally against a Donkey or a Scrooge, as both of those players are playing too many marginal hands, just hoping to connect with a flop.  There is good money to be made by building pots knowing that the Donkey or Scrooge will miss the flop and fold to a c-bet more often than not, and that even when they hit a flop, they will likely still be behind.  You should want to play big pots against calling stations willing to chase draws or call down with less than top pair.  By contrast, a Hero is not paying much attention to hand strength preflop, and building a big pot might play into a Hero's aggressive postflop style.  The key to maximizing value from a Hero is to have a good hand by the time the big bets get made on the river.  So, raise only your very best hands, and limp the rest.  There will be plenty of time to build a hand after the flop.

Popstflop, the Donkey and the Scrooge are fairly similar before the river, willing to overpay on the flop and turn to chase draws (including two pair "draws"), just in case they "get there".  By contrast, a Hero calls (or "floats") on the flop hoping their opponent is continuation betting with "air" or a weak hand, and might show weakness on a later street.  If their opponent bets the turn, the Hero calls, certain that their opponent is still weak, maybe even being a bully and trying to buy the pot.  In any event, all three kinds of calling stations will call larger than normal bets on the flop and turn.  The Donkey and the Scrooge will call up to pot-size bets because they want to get to the river and see if they make their draw or their hand is good.  The Hero calls because he is looking for weakness, and an overbet of more than the pot looks weaker than a standard half to three-quarters pot sized c-bet. 

On the river, the differences between the kinds of calling stations truly become important.  The Donkey and the Scrooge are willing to pay off a moderate value bet, usually up to about half the pot, with a marginal hand.  But neither will pay off a large bet on the river, as paying off a big bet loses face for the Donkey and money for the Scrooge.  However, because the Scrooge is generally a better player and more motivated by money, he is less likely to call with a weak hand unless presented good odds, so dial back the size of the value bet more for a Scrooge than for a typical Donkey.  By contrast, in the case of a Hero, it pays to overbet for value on the river, as the Hero is more likely to smell a bluff, is actively seeking out a bluff, and will seek the bigger psychological thrill from picking off what looks like a big bluff. 

Looking at it in terms of postflop betting patterns, the different styles might look like this in terms of percentages of the pot:
  • Donkey:  Big-big-medium (75-100% / 75% / 50-65%)
  • Scrooge:  Big-big-small (75-100% / 75% / 25-30%)
  • Hero:  Big-bigger-huge (75-125% / 100-125% / 75-150%)
One other major difference between a Donkey and a Scrooge is how they react to winning.  A Donkey will continue to be a calling station regardless of results, as his calling is driven by a fear of being shown up, of being wrong.  A Scrooge who wins a few pots, however, is highly likely to revert back to his "normal" playing style, whatever that might be.  After all, once he's won a few pots, the monetary incentive for irrational calling is alleviated.  So, with a Scrooge, be careful how you handle him once he has money; you'll likely find he's "switched gears".  The Hero, of course, will continue to find opportunities to show off for the crowd no matter how many times he is wrong, so long as he occasionally gets to preen after a successful call of a bluff (hopefully someone else's!).

Calling stations are the most lucrative type of opponent over time.  Extracting maximum value from the ETs you encounter is a major key to profitable poker.  Doing so is certainly easier than dealing with maniacs!

ET tries to cure Isildur1's bankroll "Ouch".

After that donkey sucked out on the river, I ate his
liver with some fava beans and a nice vodka-Red Bull.


* Lecter was apparently referencing this quotation from the Stoic philosopher:
This thing, what is it in itself, in its own constitution? What is its substance and material? And what its causal nature [or form]? And what is it doing in the world? And how long does it subsist?

The Meditations of Marcus Aurelius (translated by George Long)

June 20, 2010

Poker Judo at the Meadows

"We know you can fight fire with fire, but what is wrong with fighting it with water sometimes?"

—Bob Ciaffone at CardPlayer.com (hat tip to Poker Grump)

Judo is a martial art form based on the concept of using an opponent's aggression and momentum against him.  A classic example is where an attacker charges at an opponent and, rather than striking out at the attacker, the opponent steps aside and trips or throws the attacker to the ground, using the attacker's momentum to aid in the throw.

Judo can be loosely translated into English as "the way of gentleness".  Poker strategists have hammered home the exact opposite strategy—aggressive poker is winning poker.  In fact, the two profitable styles of poker—tight-aggressive (TAG) and loose-aggressive (LAG)—each directly state that aggression is a key component of the underlying strategy.  But, there can be such a thing as excessive aggression, even in poker.  Sometimes, a gentle approach is the most profitable.

Last night, I played a short session at the Meadows ATM.  After donking at 3/6 LHE for 30 minutes, I finally got a seat at one of the two 1/2 NLHE games; let's just say limit is not my best game.  In any event, I quickly discovered that there was a three-way cock-measuring battle going on at the NL game, with three aggro guys trying push people—mostly each other—around.  At least one of these guys raised nearly every hand, and most of these raises were called by at least one of the other aggros.  Check-raises, pushing with draws, floating to steal, position raises, these guys were doing it all, but doing it with pretty average stacks of $150-$250, as the rest of the table played nitty and took chunks of the aggro-stacks when they hit the rare monster hand.  These guys also made it pretty clear this was all about machismo, with lots of table chatter about why they made plays, why their plays were great, and why their opponents were idiots.  I found the whole situation amusing and potentially profitable.

In my experience, the macho LAG player might run over passive opponents, but his excessive aggression offers an opportunity for a trap play for his stack, or at least a large chunk of it.  Two big hands from my session illustrate this point.  In the first hand, I limp in middle position with 97s, a classic trapping hand.  Uber-aggro makes a standard button raise to $12, the other two aggros call, and I call to close the action.  The flop is K-9-3 rainbow.  Interestingly, it checks around.  The uber-aggro passing on a c-bet here likely means he hit the king and wants to get tricky.  The turn is a 7—Donkey Kong!  Checks to me, and I throw out a weak looking half pot bet.  I want it to look like I'm just taking a stab at the pot, in case one of the aggros wants to try to bluff me off the hand.  Sure enough, aggro on the button insta-raises to $60, folds to me, and I call, wanting to look weak and not scare off my prey.  River is a deuce.  I know aggro can't help but bet a king here, nor can he help trying to bluff if he has nada.  I normally value bet this river, but here, I check.  Uber-aggro obliges me by betting about half the pot, which is roughly a third of his remaining stack.  I raise all-in, uber-aggro calls, and proceeds to whine about how his top pair got run down (though he never showed his hand).

Aggro guy goes to the ATM, returns with $300.  He is clearly on tilt, and spews off a little over $100 in the first orbit, getting resistance to all of his plays.  In early position, I find pocket 9s and limp, looking to play for set value, or possibly a preflop squeeze play.  Aggro guy again raises in late position, gets called by the two fellow aggros and another player, so I call as well.  This is not a bad spot for a squeeze play, but even aggros get hands, my call closes the action, and the implied odds from a set are huge, so I opt for the conservative play.  The flop comes out K-K-4 with two spades.  Checks to me, and I decide this is not a bad board to bet at, so I fire out for $45 into the $60 pot.  Aggro insta-pushes for ~$200 total.  Folds back to me.

Now, this is a pretty polarizing bet.  Aggro is representing a king, which would leave me drawing to two outs at best.  But, if he has a king, why push here?  If he flat calls, he may get more action from the aggro players behind, and one of them may even make a move.  Pushing feels like he wants the field to fold, though he may also be afraid of flush draws.  But, why not make it $100 straight, with $100 to push on the turn, if he wants to fold the draws?  If he has a king, how can he expect to get called by a weaker hand?  His play really felt a lot like a nut flush draw.  I finally called, and the board ran out 3-9 (both red)—Yahtzee!  Aggro guy asks, "Miss your flush?"  I just sat there and waited for him to show.  He again asked if I had missed the flush.  Although the 20 questions routine is a pet peeve of mine, given the strength of my hand, I said, "I hit the river, but I'm pretty sure I didn't need to."  I rolled my boat, and aggro came unglued.  He started muttering about "getting two outed again", but he didn't show his cards.  Aggro continued to fume about having his trip kings run down until he left to hit the ATM again.  I'm almost positive aggro had a flush draw, not that it really matters.  Aggro managed to tilt off another two min-buys before calling it a night.

So, two hands against an uber-aggro player, two feltings.  Just a routine double-ippon for a red-belt poker judo player!

ADDENDUM (20 JUNE 2010):  Somehow in the editing and posting process, I lost a reference to Poker Grump's excellent take on taking on table bullies.  His words of wisdom (and some from Mike Caro) are worth a read.

June 17, 2010

Friday Fun (v. 1.5)—Mad Lib Sausages

We begin this edition of Friday Fun with sad news—the death of the legendary Sausage King, Jimmy Dean.  As a kid, I knew Dean as the singer of the country-rap classic, "Big Bad John".  Only later did I associate Dean with his sausage empire.  But all sausage lovers out there owe a debt of gratitude to Dean and his high-quality processed meat conglomerations.

In other sausage related news, the Apple iPhone 4G is set for release.  How is that sausage related?  Well, those enterprising South Koreans have determined that in winter, when gloves prevent iPhone touchscreen use, a warm sausage can double as a stylus.  Scoff all you want, but just keep in mind Otto von Bismarck's famous observation:  "Laws are like sausages—it is best not to see them being made."

* * * * *

Raise your hand if you remember Mad Libs—the game where you provide different words to fit categories (e.g., name, proper noun, transitive verb), then use the words to fill in a story template.  Well, today I read a news story that seemed to come straight out of Mad Libs (word categories added in brackets so you can play along at home):

A German [nationality] student [name of a vocation] created a major traffic jam [name of a crisis] in Bavaria [name of a place] after making a rude gesture at a group of Hell's Angels motorcycle gang [name of a group] members, hurling [-ing verb] a puppy [noun] at them and then escaping [-ing verb] on a stolen [adjectivebulldozer [noun].

Of course, the money quote from the police was priceless:  "What motivated him to throw a puppy at the Hell's Angels is currently unclear."   You don't say ...

* * * * *

This week saw the conclusion of Perry v. Schwarzenegger, the California gay marriage case.  Conservative Republican Ted Olson gave the closing argument in favor of finding same-sex marriage a Constitutionally protected right.  Olson was solicitor general for the George W. Bush administration; essentially, the post is the lead appellate lawyer for the United States, a position also held by legal luminaries like former Supreme Court Justice Thurgood Marshall, former Supreme Court nominee Robert Bork, and current Supreme Court nominee Elena Kagan.  For those who want to see a master legal advocate at his finest, Olson's closing argument is tough to beat.  One of his best lines was:

Marriage, the Supreme Court has said again and again, is a component of liberty, privacy, association, spirituality, and autonomy.  It is a right possessed by persons of different races, by persons in prison, and by individuals who are delinquent in paying child support.

It is the right of individuals, not an indulgence dispensed by the State of California, or any state, to favored classes of citizens which could be easily withdrawn if the state were to change its mind about procreation.  In other words, it is a right belonging to Californians, to persons.  It is not a right belonging to the State of California.  (Trans., p. 2971).

Of course, Olson might well have just let rapper Eminem make his closing argument:

I think if two people love each other, then what the hell?  I think that everyone should have the chance to be equally miserable, if they want.

* * * * *

By what names are the following fictional characters better known?
  • Roy Hinkley
  • Norville Rogers
  • Bernie Liederkrantz
  • Edgar Mallory
  • Barbara Millicent Roberts
Answers can be found at Mental Floss.

* * * * *

Thanks to Neatorama.com, I've become addicted to the offbeat humor of McSweeneys.net.  Good reads include Signs You Made a Poor Choice In Picking Up a Hitchhiker ("Conversation turns heated when topic shifts to Presidential legacy of Martin Van Buren"; "He compliments your clothes, then asks your measurements"), and a monologue by a typeface, I'm Comic Sans, Asshole ("I'm not just a font. I am a force of motherfucking nature and I will not rest until every uptight armchair typographer cock-hat like you is surrounded by my lovable, comic-book inspired, sans-serif badassery.").

* * * * *

Finally, our animal video of the week is this Kung Fu Bear:

June 16, 2010

D-Bag O' the Day (v. 1.12)—
Free the Dutch Mini-Dress Models!

Apparently, FIFA (or the D-Bags running FIFA) hates attractive women in short skirts.  At least, that's the conclusion I reached, upon hearing that South Africa has arrested two women for taking part in (and possibly organizing) an "ambush marketing campaign" where 30 attractive young women in orange mini-dresses (orange being the Dutch national team color) attended the World Cup match between the Netherlands and Denmark, and were promoting a Dutch beer company.  I suppose it's possible FIFA was merely trying to protect the multi-million dollar investment by its official beer sponsor, Budweiser, but that is a terribly cynical view. 

You be the judge.  Do these women look like hardened criminals?

Of course, I suppose a certain segment of my readers might be able to imagine these fine actresses starring in a romantic comedy based in a Dutch women's prison ...

June 15, 2010

Russ Hamilton—Doublewide Poster Boy for Online Poker Legalization

A new chapter in the continuing saga of the UltimateBet (UB) "superuser" scandal was unveiled today, as Wicked Chops Poker released Part 1 of a report on its investigation into the background of how the scandal occurred, and who was involved.  Part 1 is mostly background material, but it does a nice job connecting a lot of dots between the various players involved in the formation of UB, and tracing the development of the superuser cheating tool, a software program—referred to internally as "God mode"—that allowed the user to see all players' hole cards in a given hand.  Essentially, it sounds like former WSOP Main Event Champion Russ Hamilton, an investor and principal in UB from its earliest days, persuaded the UB CEO (who was also the primary technology developer) to develop the cheating tool so that Hamilton could catch a player he claimed was cheating him.  Of course, Hamilton, who was also one of the big players on UB, instead used the tool to cheat legitimate UB players out of millions of dollars.  According to UB's current owners, over $22.7 million has been refunded to UB players, and UB has recovered some $15 million of those funds back from the prior UB owners.  It will be interesting to see the remainder of the Wicked Chops report, as more information is released about Hamilton's confederates who assisted him in cheating players, whether by directly utilizing a superuser account, or by creating phony player accounts and moving money to help Hamilton avoid detection.

In any event, Hamilton is the perfect poster boy for online poker abolitionists, who claim that online poker sites are corrupt companies who cheat their players, along with other unsavory conduct (including money laundering).  But, in an ironic twist, Hamilton is also the perfect poster boy for online poker advocates.

Because online poker is essentially illegal in the United States (despite claims to the contrary), or at least is widely regarded as illegal by state and federal authorities, online poker sites invariably have located their businesses in foreign jurisdictions like Antigua, Costa Rica, Gibraltar, and the Isle of Man.  This foreign residency, along with the illegality of online poker in the United States, raises significant legal problems for U.S. residents.  As discussed in a previous post, a federal appeals court has ruled that U.S. residents claiming damages from alleged cheating on an online poker site cannot sue in the U.S., but must pursue their claim in the country where the online poker site is based.  Similarly, those foreign-based companies are difficult targets for U.S. criminal investigations and prosecutions.  Finally, the countries hosting and regulating the online poker companies often have a vested interest in protecting these lucrative companies (which are paying regulatory fees and taxes) from harmful investigations and claims for damages.

This brings us back to Hamilton and the UB super-user scandal.  UB happens to be regulated by the Kahnawake Gaming Commission (KGC), part of an independent tribal authority in Quebec, Canada.  Now, the KGC investigated the UB scandal, and ultimately released a report confirming Hamilton as the ringleader, identifying other account names involved in the scandal, and issuing fines and penalties against UB.  The KGC, however, stated that it was solely a regulatory agency, and had no authority to press criminal charges or order civil remedies (i.e., it could not order refunds to the victims of the cheating).  UB itself expressed concerns that its hands were tied in providing a satisfactory resolution to the scandal:

The KGC did release the name of Russ Hamilton as the main person responsible for the cheating scandal. Our investigation pointed to him being the person who cheated and benefited from the cheating. Our investigation did show that other individuals helped facilitate the cheating (i.e. there were people that help move money, create accounts, etc) and we have suspicions that other individuals might have been aware of the software or even aware that the scam was happening. Unfortunately, all of our evidence only involves data and we would take on serious legal liabilities if we just released a bunch of names.

We have attempted to have this brought into a court. However, it is very complicated for us, mainly because of jurisdictional issues regarding online gambling.

—UltimateBet COO Paul Leggett (5/28/2010 follow-up comment to his 5/27/2010 official UB blog post)

This comment echoed similar prior hand-wringing by UB and Leggett:

The Limits of the Investigation

Throughout the investigation we questioned as many people as possible trying to determine things like: who built the software, who benefited financially from the cheating, who else might have known about the cheating, etc. Unfortunately, every door we knocked on gave us very little additional information that we could use.

This limited the Tokiwro [sic] and KGC investigations because the only evidence available was data. Tokwiro is a provider of online gaming services and the KGC is a regulatory body for the gaming industry–neither are police forces and do not have the ability to interrogate or interview individuals in the same way as a typical law enforcement agency would.

—UltimateBet COO Paul Leggett (9/15/2009 official UB blog post)

These comments underscore the importance of legal process, both civil and criminal, in regulating honest businesses.  Legal process in the criminal context includes the ability to compel witness testimony before grand juries, and to subpoena records.  Legal process in a civil lawsuit (e.g., a suit for damages by players who were cheated) can include discovery of company documents and data, as well as depositions of key witnesses associated with the company.  Companies based outside the United States and whose legal status in the United States ranges from murky to illegal, have no compelling reason to comply with criminal investigations or civil lawsuits in the United States, and the courts in the United States may be powerless to impose criminal or civil liability on foreign-based companies.  Think how differently, and how much more quickly, the UB scandal (and other online poker scandals) would have played out if the FBI's forensic accountants were on the case.  Or, if a federal or state prosecutor convened a grand jury to investigate charges of fraud.  Or, if a group of cheated players discovered they were cheated and sued for damages, and had their own experts pore through UB's records.

Unfortunately, because UB was regulated by the KGC, and because UB has a murky legal status in the United States, it seems likely Russ Hamilton will simply get away with fraud.  Most likely, Hamilton will never face prosecution in any jurisdiction for what by any reasonable measure was criminal conduct.  To rub salt in the wound, Hamilton will likely keep all of his ill-gotten gains, being immune from any lawsuit for damages as a practical matter because of jurisdictional issues.

Russ Hamilton is clearly a liar and a cheater, and only avoided becoming a criminal by a fortuitous legal technicality.  Hamilton is the poster boy for the need to regulate online poker in the United States.  Online poker sites must be required to be legally accountable in the United States if they want to do business in the United States.  The easiest way to accomplish legal accountability is a federal law providing comprehensive jurisdictional and regulatory requirements for online poker sites doing business in the United States.  Some of the regulatory duties could be passed along to states with a strong regulatory environment in place for gaming; Nevada is a natural and obvious fit.  But until some kind of legalization and regulation of online poker occurs, online poker players remain at risk for becoming victims of online poker fraud, with no legal recourse.

June 13, 2010

Why Poker Litigation FAILS

Vinny Gambini:  I object to this witness being called at this time. We've been given no prior notice he would testify. No discovery of any tests he's conducted or reports he's prepared. And as the court is aware, the defense is entitled to advance notice of all witness who will testify, particularly those who will give scientific evidence, so that we can properly prepare for cross-examination, as well as give the defense an opportunity to have his reports reviewed by a defense expert, who might then be in a position to contradict the veracity of his conclusions.

Judge Chamberlain Haller:  Mr. Gambini?

Vinny Gambini:  Yes, sir?

Judge Chamberlain Haller:  That is a lucid, intelligent, well thought-out objection.

Vinny Gambini:  Thank you, sir.

Judge Chamberlain Haller:  Overruled.

—My Cousin Vinny

Last week, yet another court ruled that poker is a game of chance, rather than a game of skill, and thus is subject to laws regulating gambling.  The only twist was that this court ruling came not from a state court, or even a United States court. Nope, this time it was those evil Swiss yodelers and chocolatiers whose supreme court rejected the "poker is a game of skill" argument. The result is that poker tournaments must now abide by casino regulations, which include a 50% tax on profits, and requirements to identify players and prevent money laundering. Interestingly, the litigation leading to this decision appears to have been instigated by Swiss casinos who could not compete against unregulated and untaxed private poker rooms.  Funny how a European ruling predicated on commerce reaches the same result as American court rulings predicated on morality.

In any event, the International Federation of Poker (IFP) immediately began frothing at the mouth, waxing righteously indignant about yet another court being so stupid they couldn't see the obvious—that poker is clearly a game of skill, rather than a game of chance.  Predictably, the IFP whipped out its pride and joy—the "Mind Sport" certification—like it is some magical talisman to ward off the vampires and zombies who want to regulate poker:

This is yet another example of misguided poker thinking by courts and judges who simply do not understand the game—i.e., that poker is a 'mind-sport' of strategic skill far more than luck. …

We at IFP will continue this battle on behalf of the poker community. I urge you all to rally to our support.

Do not allow our skilful 'mind-sport' to be hijacked and repressed by ignorant legislators. We must persuade governments and courts throughout the world to separate it off from mere gambling.”

—Anthony Holden, President of the International Federation of Poker (IFP)
Take a look around the IFP website.  What, exactly, has the IFP done to advance the cause of poker legalization? They host some academic studies about poker that were already available elsewhere, but otherwise, the IFP's website seems mostly like a generic poker news website, with player profiles, tournament news, and other information unrelated to the poker legalization battle. The only "accomplishment" the IFP can take credit for is the "Mind Sport" "certification", which has all the significance and impact of a vanity license plate

License plate concept ripped off from Pokerati.com.

Although I've blogged quite a bit about the intersection of the law and poker, and even discussed the "poker is a game of skill" argument a few times (most notably HERE and HERE), the reaction within the poker community to the recent rulings by the Pennsylvania and Swiss courts confused me. Commentary in the poker community essentially mirrors the IFP position, and can be summarized as:  "How can these judges be so stupid?  Poker is obviously a game of skill!"  This attitude has baffled me a bit, but after the Swiss court decision, it occurred to me that the IFP and the poker community simply don't understand the legal system.

Here's how the poker community believes the legal system works:

A)  The legislature passes a law defining "gambling" so that "games of chance" are illegal, while "games of skill" are legal.
B)  Poker players sue and provide the court evidence that poker is a game of skill.
C)  Court rules that poker is not gambling, and is legal.

The legal process as envisioned by the poker community appears based on the assumption that the legal system operates in an analytical vacuum, partitioned off from consideration of historical and social context. This assumption is false. Legal analysis does not occur on a tabula rasa.

To try to illustrate how the poker community misunderstands the legal system, let's consider a counterfactual history of poker. Let's assume poker did not develop in the 1700s/1800s. Instead, let's assume that the only gambling card game in existence was blackjack. Then, in 2008, a group of college buddies were snowed in without internet access over Christmas break. They loved Magic: The Gathering (a card-based strategy game), so they decided to create their own card strategy game. After fiddling around with a standard card deck, they invented a game—PoKah—where various card combinations had different "power levels", and players could risk points (represented by different colored plastic chips) based on the cards in their hands. The object of PoKah was to score points by taking chips from other players, either by having the strongest cards, or making other players lay down their cards. Initially, PoKah was played without any money changing hands. However, after taking their game online (through PoKah.com and a killer iPhone PoKah app), the game's creators realized they could monetize PoKah by getting players to pay for more points/chips. Soon, playing PoKah was all the rage, and PoKah's creators were rich and famous. Most importantly, PoKah had no association at all with gambling or the gaming industry.

Unfortunately, occasional news stories broke about PoKah players who were obsessed with the game, playing for hours and spending all of their money buying more points/chips to keep playing. Based on these anecdotes, and pandering to their moralistic voting bases, several state attorneys general filed criminal charges against the PoKah.com founders for running an illegal gambling website. The game creators contested the charges, claiming that PoKah was no different than Magic: The Gathering in its card format, and no different in its online version than other interactive fee-based games like World of Warcraft or FarmVille. The PoKah Players Alliance got involved in the trial, providing the court with several academic studies demonstrating that PoKah players utilize mental skills, such as logic, mathematics, and game theory. Based on the overwhelming evidence, the courts invariably ruled that PoKah was not "gambling". Soon after, the first World Series of PoKah was organized in San Diego, inspiring a blockbuster movie, Dodecahedroners, which followed two fictional characters (played by Megan Fox and Ryan Gosling) as they battle for love and money over the PoKah tables.

So, what is the difference between our PoKah counterfactual and the current poker litigation? The key difference is in the varying historical and social context for PoKah and poker. Poker has two centuries worth of baggage, being associated with gambling, cheats, crooks, and other shady folks. State laws against gambling have always either explicitly included poker, or more commonly have implicitly been understood to include poker. Poker in popular culture similarly has been portrayed for decades as gambling. Poker is generally associated in the public mind with casinos or illicit gambling venues (e.g., Old West saloons, modern day underground clubs, and home games). Online poker sites are in the news for cheating their players, and being associated with money launderers. The UIGEA is widely viewed as being directed at online poker sites, and was enacted as part of an anti-terrorism bill, purportedly to help crack down on terrorists funding their operations and disguising their financing arrangements (i.e., money laundering).

Many in the poker community look at the legal system and expect the courts to ignore the entrenched historical and social context of poker and gambling laws. But laws cannot be interpreted in a contextual vacuum. The game of poker has been regarded by society as "gambling" for decades. Courts will rightly be very reluctant to rule in a way that contradicts long-established societal views of poker and gambling, absent some compelling reason, even if the court would have decided the poker-gambling issue differently if analyzing the issue as a matter of first impression.*  By contrast, a court confronted with the new game of PoKah would analyze that game in the context of its modern creation, and likely find that it was different in key aspects from games historically regulated as gambling. Deciding where a new game like PoKah fits into society's views of gambling as a matter of first impression gives a court substantially greater latitude to analyze the game based on its intrinsic properties.

The poker community needs to recognize that asking the courts to rule that poker is not gambling is essentially asking the courts to overturn a long-established social and legal understanding that poker is gambling. In essence, the "poker is not gambling" litigation is asking the courts to second-guess the initial determination that poker is gambling decades after the fact, rather than making an initial determination of poker's place as a new game in an established gambling regulatory environment. Unfortunately for the poker community, courts are generally unwilling to issue rulings contravening social conventions and established legal understandings; except when confronted with issues of discrimination or constitutional principles, neither of which is implicated in the poker-gambling debate. The poker-gambling debate is one where courts will ratify the established socio-legal view of poker as gambling, and leave it to the elected legislatures or Congress to determine whether and when to alter the legal status of poker.

So, if the poker litigation strategy is doomed to failure, does it have any redeeming value? One could argue that litigation has allowed poker legalization advocates an opportunity to air their arguments that poker is a game of skill. But, those same arguments could be made in the context of lobbying state legislatures and Congress to carve out regulatory exceptions for poker without the significant disadvantages of the litigation strategy. By tilting at the litigation windmill, poker advocates have instead worsened the position of poker.  There are now binding appellate court decisions in several states explicitly finding that poker is gambling. These rulings reinforce in the public mind—with the imprimatur of judicial decisions—that poker is gambling, while also removing any arguable ambiguity as to the legality of poker (and online poker) for players in those states.

In short, the "poker is a game of skill" litigation strategy, while certainly well-intentioned, is ill-conceived, counterproductive, and ultimately doomed to failure. Poker legalization advocates would be better off focusing their efforts on lobbying for legislative action legalizing and regulating poker.

* A excellent example of this principle in action was the late U.S. Supreme Court Chief Justice William Rehnquist, who opposed the Court's original Miranda decision imposing the requirement that police advise criminal suspects of their constitutional rights, but later voted to uphold those warnings, writing an opinion finding that the warnings were an established part of the law: "Whether or not we would agree with Miranda’s reasoning and its resulting rule, were we addressing the issue in the first instance, the principles of stare decisis weigh heavily against overruling it now. ... Miranda has become embedded in routine police practice to the point where the warnings have become part of our national culture."