Federal crackdown sidelines Phil Ivey in WSOP tourney

Poker standout Phil Ivey, a winner of eight World Series of Poker gold championship bracelets and considered by many to be one of the game’s best players, said he would not participate in the 2011 tournament.

In a statement posted on his website, Ivey said he was “embarrassed” his online sponsor, FullTilt Poker, had not paid players owed money after the U.S. Department of Justice shut down the operation in April.

Ivey also filed a lawsuit in Clark County District Court on Wednesday, saying allegations of illegal activity surrounding Tiltware, a California-based LLC that operates FullTilt, damaged the poker player’s reputation within the gambling community because of his association with the website.

In the lawsuit, Ivey said FullTilt, whose founders were charged in a nine-count federal indictment in April, owes American players approximately
$150 million. Ivey alleged the company did not maintain a reserve account to sufficiently satisfy the return of the funds.

“I am equally embarrassed that as a result many players cannot compete in tournaments and have suffered economic harm,” Ivey said in a statement that was dated May 30 but wasn’t posted to his website until Tuesday evening.

“I am not playing in the World Series of Poker as I do not believe it is fair that I compete when others cannot. I am doing everything I can to seek a solution to the problem as quickly as possible.”

Ivey is one of 14 professional poker players listed as being part of “Team FullTilt” on the company’s website. FullTilt also lists nearly 100 well-known professional players as part of its “FullTilt Pros.”

In the lawsuit, Ivey said he has been unfairly targeted by American online poker players making comments on social media websites who are “under the mistaken belief” that Ivey “has the ability to cause FullTilt Poker to return the player’s funds.”

Ivey said his reputation has suffered .

“I am deeply disappointed and embarrassed that FullTilt players have not been paid money they are owed,” Ivey said.

“My name and reputation have been dragged through the mud, through the inactivity and indecision of others and on behalf of all poker players, I refuse to remain silent any longer.”

A company representative for FullTilt could not be reached for comment.

The 42nd World Series of Poker began play on Tuesday at the Rio. The tournament, which runs through July, is expected to host 58 events over 50 days.

Ivey has been one of the most successful players at the World Series of Poker, winning eight events since 2000, which ties him for fifth place on the tournament’s all-time list. Ivey has won almost $5.3 million in his World Series of Poker career, and he has earned more than $13.8 million in tournament poker.

In 2009, Ivey reached the final table of the World Series of Poker’s Main Event, the $10,000 buy-in, no limit hold ’em world championship, finishing seventh.

Aria’s high-limit poker room is named for Ivey.

Ivey couldn’t be reached for comment.

His attorney, David Chesnoff of Las Vegas, said Ivey filed the lawsuit “because he feels terrible that people haven’t been paid.”

Chesnoff wouldn’t comment on Ivey’s contractual agreement with FullTilt.

In April, the U.S. Department of Justice charged 11 individuals, including the founders of PokerStars, FullTilt Poker and Absolute Poker, with money laundering, bank fraud and operating illegal gambling businesses in a nine-count indictment unsealed in New York. The websites were frozen, and the government said it was seeking $3 billion in money laundering penalties.

PokerStars, which is based in the Isle of Man, and FullTilt, which is licensed in Alderney, both reached agreements with the Justice Department last month to pay back American customers. In a statement, PokerStars said it had refunded more than $100 million to U.S. poker players.

FullTilt has not returned any funds.

“I wholeheartedly refuse to accept nonaction as to repayment of players funds, and I am angered that people who have supported me throughout my career have been treated so poorly,” Ivey said in his statement.

World Series of Poker spokesman Seth Palansky said tournament officials didn’t have any comment on Ivey’s statement.

Several well-known professional poker players took to Twitter to comment on Ivey’s action.

“Read Ivey’s statement on not playing the WSOP,” Daniel Negreanu said. “Tough spot, but I definitely admire his decision to put the players funds before bracelets.”

Doyle Brunson, who has 10 World Series of Poker individual event bracelets, said on Twitter, “Kudos to Ivey. Gotta think he’s a little bit nuts though. Actually, I always knew he was,” Brunson said, adding a happy face to the end of his tweet.

Palansky said tournament officials decided players who reach tables being filmed by ESPN during the World Series of Poker would not be allowed to wear the logos of Internet poker companies that accepted wagers from Americans after the Unlawful Internet Gambling Act became law in 2006. The act made it illegal for banks and financial companies to process Internet gambling transactions.

Contact reporter Howard Stutz at hstutz @review journal.com or 702-477-3871. Follow @howardstutz on Twitter.