The Kentucky Court of Appeals today unanimously reversed a Circuit Court decision to prevent the Interactive Gaming Council (IGC), an association comprised of various internet gaming operators, from intervening on behalf of the internet gaming operators.

The case has already made its way up and down the Kentucky court system several times and looks to be headed for another round before the Kentucky Supreme Court.

As background, in 2008, the Commonwealth of Kentucky seized 141 domain names alleged to be involved in illegal internet gaming in Kentucky.  The IGC moved to intervene in the forfeiture action to contest the forfeitures on behalf of its members.  IGC argued the domain names are not property subject to forfeiture, domain names do not constitute a ”gambling device or gambling record” under Kansas law, and poker is not gambling under Kansas law.

Today’s appellate decision lays the framework for a test for determining associational standing in Kentucky.  The Court of Appeals found that requiring each domain name owner to pursue individual claims “would be burdensome and inefficient” as “IGC’s arguments are directed toward the entire forfeiture procedure, not toward issues affecting individual ownership interests of the varied domain name owners.”

This matter may be the first time the Kentucky Supreme Court addresses whether Kentucky will follow the third prong of the federal Hunt test:  

[A]n association has standing to bring suit on behalf of its members when: (a) its members would otherwise have standing to sue in their own right; (b) the interests it seeks to protect are germane to the organization's purpose; and (c) neither the claim asserted nor the relief requested requires the participation of individual members in the lawsuit.

Today, the Court of Appeals held that under Kentucky law “the third Hunt factor should be applied [on a case-by-case basis] flexibly in light of the nature of the claims and/or defenses actually at issue in the suit” and should not “be applied rigidly to prohibit associational standing in all forfeiture actions.”

And so the saga over Kentucky’s 2008 seizure of 141 internet gaming domain names continues…

Stay tuned for updates on the legal battle.