How will the government react?

[Dr. Jack]

When/If this indictment against BOS goes down in flames and they have just handed them more publicity than any online book could even purchase.

You can bet they will be a little upset if this happens

[Romanowski]

Jack this is very similar to what happened 8 years ago with JC from WSEX

[Dr. Jack]

Yes it is and look at them now. Agree

[Dr. Jack]

Originally Posted by Romanowski

Jack this is very similar to what happened 8 years ago with JC from WSEX

Jay Cohen's appeal was rejected by the U.S. Supreme Court in June 2002 and he began serving his 21-month prison sentences shortly thereafter.

July 31, 2001 - Agreeing that a decades-old U.S. law aimed at Bookmakers can be used in at least some instances to go after Internet gambling operators, a federal appeals court on Tuesday upheld the conviction of a former stockbroker who accepted Americans’ sports bets from the Caribbean island of Antigua.

In upholding the first Internet gambling conviction under federal law, a three-judge panel for the Second Circuit of the U.S. Court of Appeals found no merit in the six legal points raised in Jay Cohen’s defense.

In a 23-page ruling, Circuit Judges John Keenan, Pierre Leval and Fred Parker said Cohen’s contention that he believed his sports-betting business, which was licensed by the Antiguan government, was operating legally was immaterial.

The court also rejected arguments that clients of World Sports Exchange were only transmitting betting instructions by telephone and over the Internet, since they were required to open bank accounts in Antigua before they could begin wagering.

Nor did the judges accept Cohen’s contention that it is not illegal to place a sports bet in the state of New York, or to receive such a bet in the sovereign nation of Antigua.

Appeal planned
Cohen, a 34-year-old former stock trader, told MSNBC.com shortly after the ruling was announced that he planned to appeal.

“I’m shocked but we’ll keep fighting,” Cohen said from San Francisco, where he has been living while free on bail pending a ruling on his appeal.

Melinda Sarafa, an attorney with the New York City law firm of Brafman & Ross, which represented Cohen, said his legal team would petition the Supreme Court to hear the case if it is unable to persuade the Court of Appeals to rehear the case.

“We’re very disappointed with the decision and don’t believe it has fully addressed the issues,” Sarafa said. “We think we submitted a very compelling case for reversal.”

Marvin Smilon, a spokesman for the U.S. Attorney’s Office for the Southern District of New York, declined to comment on the decision.

Only case to go to trial
Cohen, who co-founded World Sports Exchange in 1996, was one of 21 U.S. citizens named in a series of highly publicized indictments in 1998 that charged them with illegally using interstate telephone lines to take online wagers from U.S. customers. The indictment said such wagers violate the federal Wire Communications Act, a decades-old statute aimed at bookies that prohibits use of phone lines to bet on sporting events.

But while the other 20 entered guilty pleas prior to trial, were dropped from the case or are fugitives — including Cohen’s former business partners, Steve Schillinger, Spencer Hanson and Haden Ware — Cohen elected to return to the United States to fight the charges.

Prosecutors argued that language in the Wire Communications Act barring “use (of) telephone lines ... for the placement of sports bets, or for the transmission of information assisting in the placing of bets on sporting events and contests” clearly applied to Cohen.

Facts not in dispute
Cohen did not dispute the facts of the case — that FBI agents had opened accounts with the World Sports Exchange and placed wagers on numerous sporting contests. Instead, he and his attorneys argued that modern communications technologies raised legal issues that were not addressed by the law, which predated the creation of the Internet by more than a decade.

For example, Cohen argued that because customers must open and fund accounts on the island before betting, the transactions — the debiting or crediting of the customer’s account by the company’s servers — occur entirely in Antigua. He also argued that New York’s state-regulated off-track betting parlors have for years accepted bets on horse racing from residents in other states where account wagering is not legal under the same legal principle.

A jury did not buy the arguments, finding Cohen guilty in February 2000 of conspiring to violate and violating the federal Wire Act. Six months later, he was sentenced to 21 months in prison and fined $5,000. He has remained free while his appeal has been pending, once more free-lancing as a stock trader in San Francisco.

The appeals court also rejected the arguments, but in doing so gave short shrift to the issues raised in Cohen’s defense, said attorney Sarafa.

Comparison to off-track betting
“The court ignored legitimate contentions that Mr. Cohen’s business operated no differently than various state-run off-track betting organizations which accept interstate wagering instructions by telephone and the Internet,” she said. “Yet Mr. Cohen alone faces imprisonment for conduct that these organizations and hundreds of other businesses engage in every day.”

Some legal experts have said that Cohen’s case could have far-reaching consequences in such areas as Internet taxation and criminal jurisdiction over Web sites operating in foreign jurisdictions.

I. Nelson Rose, a law professor at Whittier College and expert on gambling law, said that federal prosecutors carefully chose their targets when they picked Cohen and the other gambling site operators, a tactic that allowed them to skirt the most dicey legal issues raised by online betting.

“Jay Cohen is an American citizen, he was taking bets on sports events, so we don’t get into the question of whether the Wire Act covers casino-style games ... and, most important, he was taking sports bets by phone as well as over the Internet, and the Wire Act clearly applies to phone wagering,” Rose said.