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Amaya Inc. (NASDAQ: AYA; TSX: AYA) today provided clarity regarding a dispute in the Commonwealth of Kentucky relating to certain activities of the PokerStars business during a period between 2006 and 2011, approximately three years prior to Amaya’s acquisition of the brand. Amaya believes the action is frivolous and without merit.
This civil proceeding was initially filed in 2010 under an antiquated 18th century Kentucky statute. The Commonwealth claims that it is entitled to recover alleged losses of Kentucky residents who played real-money poker on the PokerStars website during the period between October 12, 2006 and April 15, 2011. A similar action filed against PokerStars in Illinois was dismissed by that court earlier this year.
During the five year period at issue, PokerStars generated aggregate gross revenues in the Commonwealth of Kentucky of approximately US$18 million. Nonetheless, the Commonwealth sought an award as high as US$290 million and requested it be trebled. The trial court subsequently indicated that this amount is incorrect and has not yet entered a final order awarding damages. Any such final order would be subject to appeal.
Amaya intends to vigorously dispute any liability that may be ordered at the trial court level, and believes that there are a number of compelling legal arguments reserved for consideration, including, without limitation, the lack of standing to bring this proceeding in the name of the Commonwealth and the Court’s failure to properly apply the law.
To the extent the PokerStars entities may be ultimately obligated to pay any amounts pursuant to a final adjudication following exhaustion of all appeals and other legal options, Amaya intends to seek recovery against the former owners of the PokerStars business.
