Howard Lederer's attorneys filed a Motion to Dismiss the Verified Second Amended Complaint (SAC) and a Notice of Motion with the United States District Court of Southern New York.
Elliot R. Peters and Cody S. Harris of Keker & Van Nest LLP filed the three-page Notice of Motion to Dismiss in San Francisco. The Motion states: “Defendant and Claimant Howard Lederer hereby moves the Court to dismiss the $42.5 million in personam claim against Lederer for money laundering, along with the First and Second Claims for Relief in rem.”
The Second Amended Civil Complaint was filed in September by the U.S. Department of Justice and involved the online poker Black Friday indictments but introduced new forfeiture charges against Lederer and Ray Bitar with the inclusion of houses and automobiles that were supposedly purchased with "illegal proceeds."
The Second Amended Complaint held a detailed account of Lederer's expenditures starting with the end of 2006 until September 2011, and added eight more "Claims for Relief," which brought the total charges to 12: Illegal Gambling, Conspiracy Relating to Full Tilt Fraud Against Players, Bank and Wire Fraud, Wire Fraud, Promotion Money Laundering and Conspiracy, Concealment Money Laundering and Conspiracy, Bulk Money Laundering and Conspiracy, Promotion Money Laundering and Conspiracy Relating to Full Tilt Fraud Against Players, Concealment Money Laundering and Conspiracy Relating to Full Tilt Fraud Against Players, International Money Laundering and Conspiracy, International Money Laundering and Conspiracy Relating to Full Tilt Fraud Against Players, Bulk Money Laundering, and Travel Act Offenses.
The SAC's legitimacy was attacked immediately in the 33-page Motion to Dismiss. “The SAC is so structurally complex that it takes a cartographer to understand what is being alleged and against whom,” in the second paragraph of the Motion. “As to Lederer, the allegations of scheming to defraud customers, the centerpiece of the [First Amended Complaint], are gone. The centerpiece of this complaint as it pertains to Lederer is the allegation that FTP—an online poker site operating abroad—was an illegal gambling business under the Illegal Gambling Business Act, ("IGBA"), 18 U.S.C. § 1955, rendering illegal any proceeds Lederer derived from it. Never mind that one month before the government filed the SAC, the Honorable Jack B. Weinstein, United States District Judge for the Eastern District of New York held in an exhaustive, 120-page opinion, that poker does not constitute ‘illegal gambling’ under the IGBA.”
“Because the government has disclaimed any attempt to state a fraud claim against Lederer—either based on alleged bank fraud or a fraud against FTP's own customers — the in personam money laundering claim must be dismissed in its entirety, along with the First and Second in rem claims against Lederer's property,” was also in the motion.
The case's background and legal standard was emphasized before the Motion's argument section which points out: poker is not gambling as defined by the IGBA per Judge Weinstein's opinion; there aren't sufficient facts to support a violation of state law; ”Under the Supreme Court's decision in Morrison v. National Australia Bank Ltd, 130 S. Ct. 2869 (2010), IGBA does not apply extraterritorially to a business operated abroad whose only contact with the United States is that some of its poker players are based here." and continues the argument against the Travel Act claim.
Bitar, Chris Ferguson, and Rafe Furst (other Full Tilt Poker defendants in the case) haven't responded yet to the Second Amended Complaint. The DoJ is looking to win forfeitures from them for $42 million, $40.8 million, and $11.7 million respectively.
Lederer's Motion to Dismiss will be heard at a time and date to be determined by the Honorable Leonard B. Sand.