PokerStars Hits Speed Bump in NJ; Chances Still Good for License

pokerstars 100A funny thing happened in New Jersey last week as the state moves closer to launching their real-money online gambling sites, and the New Jersey Division of Gaming Enforcement gave us our first look at the sites that are likely to be ready to go for the soft-launch on November 21st and the tentatively scheduled full launch on November 26th.

The list of companies approved for a transactional waiver was released by the New Jersey Division of Gaming Enforcement–who will from here on out be referred to as the DGE – on Friday (November 8, 2013) and the big news was that PokerStars was nowhere to be found.

PokerStars and the NEW regulated US market

PokerStars is the biggest online poker provider in the world, and it has pretty much ruled the roost in the industry since 2006. But their attempts at a legal reentry into the US market have been rebuffed thus far, with Nevada enacting a “bad actor” clause that will keep PokerStars out of the state for at least five years, and Delaware choosing 888 (along with Scientific Games) as their online provider –PokerStars was among the companies that applied for the job in Delaware.

That left PokerStars with only one available route back into the US at present, New Jersey. And now their access to that entryway seems to be shrinking as well.

It should be noted that PokerStars wasn’t flat-out denied in New Jersey, and to be honest they really weren’t even confronted by a red light; the non-inclusion of PokerStars in the list of transactional waivers revealed on Friday, was more of a stop sign thrown up by the DGE.

Like a base runner stopped by their third base coach, PokerStars is still on base, and still has a chance to score. But to score they will likely have to follow in some of their competitor’s footsteps –competitors that did receive a transactional waiver last week.

Amaya Gaming Severs Ties and Receives a Transactional Waiver

It seems that Amaya Gaming’s transactional waiver was contingent on Paul Leggett leaving the company –Leggett is the former Cereus Network CEO, and a bit of an anathema among the poker community.

So, it’s quite likely the same thing will be required of PokerStars. Perhaps the only remaining roadblock for PokerStars is some type of public resignation by Isai Scheinberg?

Betfair and Party Make the Cut

PokerStars may be on the outside looking in right now, but two other online gaming giants, Betfair and Party Poker (bwin.party), were given the green light by the DGE, and it can be argued that Party Poker’s closet has just as many skeletons as PokerStars –although they are a bit older – and Betfair has the dubious distinction (at least when it comes to US lawmakers and regulators) of being primarily a sports-betting operation.

Party Poker was essentially in the same boat as Amaya Gaming, and their transactional waiver hinged on the future sale of the shares controlled by James Russell DeLeon and Ruth Parasol DeLeon according to a report by Reuters. So again, is the holdup with PokerStars in New Jersey merely a matter of Isai Scheinberg?

PokerStars Chances

I think the fact that the DGE is still considering PokerStars, and has been more optimistic than pessimistic whenever addressing the company’s ability to secure a license, speaks volumes about Stars chances in NJ.

There is no reason for regulators to lead PokerStars or the public on, and give them a song and dance about how hard they are working to get their application approved. The Atlantic Club did that, but they were looking for a cash windfall (and got it), but in the case of the DGE there simply is benefit: No money, no boost to their reputation, no increase in perceived competency, no nothing.

That being said, PokerStars is facing some stiff opposition in the form of land-based casinos and their lobbying group the American Gaming Association (AGA). Opposition that is willing to go to great lengths to keep the world’s largest online poker room out of the US market.

Still, the AGA’s demands that New Jersey regulators disallow PokerStars from entering the market were pretty much ignored, and other than their one very public salvo when PokerStars was in talks to purchase the Atlantic Club the AGA has been relatively quiet when it comes to PokerStars.

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