Poker tour says law no big deal, but is it bluffing?

GIVE embattled WPT Enterprises Inc. high marks for operator resilience.

The operator of the World Poker Tour issued a strangely optimistic statement in the wake of online gambling limits recently signed into law by President Bush. The Unlawful Internet Gambling Enforcement Act of 2006 effectively prohibits banks and credit card companies from sending payments to offshore gambling Web sites.

"The Justice Department has been very clear that it believes online gaming to be illegal in the United States and our policies have been always been tailored accordingly," said Adam Pliska, General Counsel of WPTE. "This law clarifies the rules and makes it possible for everyone to move forward on an even footing."

The loss of outlets for (paying) poker players will almost certainly dramatically decrease WPT tournament fields, however, because of fewer opportunities for players to use online play-ins to earn their way into competition.

It's been a rocky year for the WPT, starting with a lawsuit filed against its TV partner Travel Channel. The suit was only recently resolved, but was followed by another, filed against the tour by seven of the tour's best-known players. It accused the company of violating antitrust laws by conspiring with the casinos to eliminate competition.

The company hasn't reached profitability, and posted a $5 million loss last year, including a $1.4 million loss in the fourth quarter. But it's not a bust yet. The WPT is holding a lot of cash and reported revenues of $18.1 million for 2005, up from $17.6 million in the prior year.