Another Day, Another Legal Action

18 September 1997

MADISON, Wisconsin - Attorney General James Doyle joined the fray in the internet gambling battle by announcing that his office has filed three lawsuits against a number of individuals, groups and corporations trying to operate gambling sites on the Internet. The lawsuits are the first of their kind in Wisconsin and among the first such actions to be filed in the United States.

"Accepting bets via the Internet is illegal under Wisconsin law," Doyle said. "Internet gambling is a bad bet for consumers because those who offer such games are totally unregulated. If you lose your money to a bookie in cyberspace, it might be very difficult to get it back."

Doyle said that a number of gambling operators are trying to use the Internet in order to escape state and federal laws. In addition to being illegal, consumers need to know that there is no guarantee that they will receive any payouts if they win because no law enforcement agency is monitoring the odds or payments. Doyle said he also fears that a growth in Internet gambling -- which could make all home computers mini-casinos -- will lead to increased gambling by children and people who suffer from gambling addiction.

Though poor Internet technology makes many of the games slow and it is difficult to exchange money rapidly through computers right now, Doyle said those barriers are only temporary roadblocks for gambling operators. The Attorney General believes those obstacles will soon be overcome by improved technology.

Doyle said the lawsuits are against:

  • Coeur d'Alene Tribe, Plummer, Idaho; Unistar Entertainment, Inc., Englewood, Colorado; and Executone Information Systems, Inc., Milford, Connecticut -- for the operation of US Lottery.
  • Net Bet, Inc. and Torrey Pines Nevada, Inc., Las Vegas, Nevada, both doing business as Casinos of the South Pacific; Donald Wright, Irvine, California, the president of both companies; and James Brewer, Irvine, California, the secretary/treasurer of both corporations.
  • On-Line International, Inc., planning to operate in Oak Creek, Wisconsin; and its owner, World Wide Web Casinos, Inc., Santa Ana, California.


Doyle said that the US Lottery advertises several lottery-type games over the Internet available to persons in 33 states, including residents of Wisconsin. The Internet advertising for US Lottery indicates that other forms of gambling -- such as blackjack, video poker and slots -- will be offered in the near future.

According to the Department of Justice's complaint, the US Lottery website represents that it is legal for Wisconsin residents to gamble on these games. The complaint alleges that the US Lottery openly encouraged and permitted an investigator from the Wisconsin Department of Justice to engage in gambling transactions.

Doyle said that he and 34 other state Attorneys General have told the National Indian Gaming Commission that the Coeur d'Alene's lottery violates the law. However, the Commission has not taken steps to close down the operation.

The lawsuit alleges that the US Lottery's gambling activities constitute a public nuisance. The state is seeking an injunction preventing further solicitations of Wisconsin residents as well as the representations that the US Lottery is legal in Wisconsin. In addition, the suit seeks civil forfeitures and penalties, and restitution for Wisconsin residents who have been victimized by the gambling operation.


According to the Department of Justice's complaint, the Casinos of the South Pacific website offers five games, including poker, blackjack and slots. The complaint alleges that different screens on the website lead players to believe that it is legal for Wisconsin residents to gamble at this site.

The registration form says that only players from Nevada, Minnesota and New Jersey are ineligible to play. According to the membership agreement, only residents of the Cook Islands are ineligible to play. The membership agreement also claims that someone playing Casinos of the South Pacific on the Internet is actually traveling to the Cook Islands when playing and that it is legal for most individuals to take part in the legal activities of the country where they are visiting.

Doyle said that a Justice Department investigator was able to register and play at the Casinos of the South Pacific website using a Madison, Wisconsin address.

The suit asks the court to declare Casinos of the South Pacific a public nuisance and to stop its activities in Wisconsin. The state also seeks forfeitures for the alleged violations and restitution for Wisconsin consumers.


The third lawsuit asks the court to annul the corporate existence of On-Line International Inc. On-Line's parent company, World Wide Web Casinos, has indicated a desire to set up shop in Oak Creek, Wisconsin, in order to manufacture gambling software and receive Internet gambling bets. After the Department of Justice advised corporate representatives that such an operation would violate Wisconsin laws, On-Line sued Wisconsin in an attempt to keep the state from enforcing its gambling laws. That suit is in federal court in Milwaukee.

This action requests that a Dane County Circuit Court oust On-Line International from Wisconsin because the corporation does not have a lawful purpose. In Wisconsin, enterprises may incorporate for any lawful business. Gambling is not legal.

The Attorney General said that this lawsuit is necessary to prevent an illegal gambling enterprise from acquiring the powers granted by statute to legitimate Wisconsin corporations and to prevent On-Line from presenting itself as a business that is being operated with state sanction.

All three actions were filed today (Monday, September 15, 1997) in Dane County Circuit Court.

Doyle said that Congress and federal law enforcement agencies should take the lead to stop consumers from being victimized by Internet gambling operators. He supports federal legislation sponsored by U.S. Senator Jon Kyl (R-Ariz.) which would strengthen federal law in this area.

"My greatest concern is that as the Internet becomes an accepted way to conduct commerce, consumers will falsely believe that Internet gambling is regulated and fair," Doyle said. "There is no system in place to make that happen. You don't know who is on the other end of the Internet site and you have no protection when you give them your money."