A recent law suit in Kentucky has attracted world-wide attention because it could create a very dangerous precedent—the application of local law to the domain name system and Internet web sites that are available globally.

On October 16, 2008, a Kentucky trial court entered an order purporting to seize 141 domain names allegedly involved in gambling. The basis of the order was the allegation by the state of Kentucky that gambling on the Internet violates Kentucky’s state laws regulating gambling. A subsequent amendment to the order would exempt web sites that installed a “geographic filter” preventing access by Kentucky residents.

Even though the Kentucky case only involves Kentucky gambling laws, the dangerous precedent is that regimes around the world with oppressive local laws restricting speech or religion might attempt similar litigation.

On November 17, the Kentucky Court of Appeals granted a stay of the order of the trial court. This will allow the appeal to proceed before the names can be transferred. A number of organizations have joined in supporting the appeal.

At this time, it is not clear when the appeal will be decided. It is very likely that any decision by the Kentucky Court of Appeals will be further appealed by the losing party to the Supreme Court of Kentucky. It is also very likely that there will be a further appeal to the Supreme Court of the United States, or there may be some other legal maneuver intended to get the case before the federal court system of the United States. The only certainty is that there will be no final decision until several years have passed.

The primary basis of the appeal is that the attempted seizure violates provisions of the Constitution of the United States, including protection of freedom of speech and the principle that states cannot interfere with commerce that is national or global.

In addition, there are at least two other legal issues involved, either of which may have a bearing on the outcome of the case. These include the question of jurisdiction of state courts over domain registrants, registrars and registries outside the state (and some outside the USA), and the question whether domain names are property capable of being seized by a court.