Judge rules in Ivey/Borgata case (1 Viewer)

[jbutler]

Good overview of the decision here and good background here. The decision held that while Ivey successfully defeated the fraud counts, he was found to have breached the implied contract with Borgata and is thus liable for the damages sustained by Borgata as a result of his breach.

Borgata will very likely be entitled to recover all of its losses from Ivey. What exactly they will allege as losses is yet to be seen, but Borgata will be submitting a brief setting forth damages soon and Ivey will have 20 days to file a responding brief.

Certainly the base of the damages will be the amounts won by Ivey during his 2012 visits to Borgata, which were summarized by the author of the above article as follows:

- April 2012: $2.4M in winnings over 16 hours, average bet of $25,000 a hand
- May 2012: $1.6M in winnings over 56 hours, average bet of $36,000 a hand
- July 2012: $4.8M in winnings over 17 hours, average bet of $89,000 a hand
- Oct. 2012: $0.8M in winnings over 18 hours, average bet of $93,800 a hand​

 

[upNdown]

ick

I'll read the decision when I get a chance. But I find it very difficult to find an implied contract when
1) Everybody intends to beat the house, and
2) All his specific requests made it pretty clear HOW he was trying to beat the house
Don't tell me the casinos didn't know EXACTLY what he was trying to do. They just figured it wouldn't work.

 

[jbutler]

ick

I'll read the decision when I get a chance. But I find it very difficult to find an implied contract when
1) Everybody intends to beat the house, and
2) All his specific requests made it pretty clear HOW he was trying to beat the house
Don't tell me the casinos didn't know EXACTLY what he was trying to do. They just figured it wouldn't work.

There is almost certainly an implied contract: both parties impliedly agree to spread and play games using procedures established by the Casino Control Act. The question is whether his actions constitute breach.

Without having read the opinion or having recently read the regulation, I don't know if the judge's position - that the positioning of the specific type of cards resulting in the ability to identify certain cards qualifies as "marking" under the meaning of the law - but it's not an unreasonable position.

 

[DJ Mack]

How is this not a form of card counting which is explicitly legal in most places? If you can keep track of it all in your head then good for you.

Having a second person involved does usually cross the line though. Now if Sun had done the gambling on her own this might be an entirely different issue.

 

[jbutler]

How is this not a form of card counting which is explicitly legal in most places?

Might be why Ivey targeted Borgata because card counting is not illegal in New Jersey.

Someone somewhere wrote a good long piece about Ken Uston's court battle to win the right to count cards in NJ, but I don't recall immediately where I read it. Probably in Card Player back in the day, but Google is not immediately helpful.

 

[DJ Mack]

Someone somewhere wrote a good long piece about Ken Uston's court battle to win the right to count cards in NJ, but I don't recall immediately where I read it.

I'd like to learn more about that some time. Seems to me like it would be an example of winning a battle and losing a war. Congrats Ken! You won and can count cards now! Except here is a stack of letters from all the casinos in the state banning you from their premises. LOL

 

[jbutler]

I'd like to learn more about that some time. Seems to me like it would be an example of winning a battle and losing a war. Congrats Ken! You won and can count cards now! Except here is a stack of letters from all the casinos in the state banning you from their premises. LOL

That was the point. He had already been banned. He fought against the bans and won. The casinos then had no right to ban him for counting cards. Instead, they just bumped up the number of decks in the shoe, shuffled more often, and started paying less for blackjack on some tables.

 

[DJ Mack]

That was the point. He had already been banned. He fought against the bans and won. The casinos then had no right to ban him for counting cards. Instead, they just bumped up the number of decks in the shoe, shuffled more often, and started paying less for blackjack on some tables.

Interesting. I know here in Ohio it is explicitly legal to count cards however it's not a protected right; casinos can ban somebody without giving a reason.

The rule just means that your friendly local casino control agent won't pull you from the table in cuffs.

So in a case like Ken's the bans would stand but he would face no criminal liability.

 

[upNdown]

There is almost certainly an implied contract: both parties impliedly agree to spread and play games using procedures established by the Casino Control Act. The question is whether his actions constitute breach.

Without having read the opinion or having recently read the regulation, I don't know if the judge's position - that the positioning of the specific type of cards resulting in the ability to identify certain cards qualifies as "marking" under the meaning of the law - but it's not an unreasonable position.

If it was a prosecution, i'd agree with you. But in a civil matter, I'd think there's an estoppel argument.
If they agreed to his terms, even if his terms constitute a breach of the Casino Control Act, once they agree to his terms, aren't they estopped from falling back on the CCA, when they don't like how it turned out?

 

[jbutler]

Interesting. I know here in Ohio it is explicitly legal to count cards however it's not a protected right; casinos can ban somebody without giving a reason.

The rule just means that your friendly local casino control agent won't pull you from the table in cuffs.

So in a case like Ken's the bans would stand but he would face no criminal liability.

Still not correct. As a result of his case, Uston was able to reenter casinos from which he had been previously banned explicitly for the purpose of counting cards. Here is the final paragraph of the NJ Supreme Court's decision in the matter (and the link here to the full decision if you'd like to read it):

In sum, absent a valid Commission regulation excluding card counters, respondent Uston will be free to employ his card-counting strategy at Resorts' blackjack tables. There is currently no Commission rule banning Uston, and Resorts has no authority to exclude him for card counting. However, it is not clear whether the Commission would have adopted regulations involving card counters had it known that Resorts could not exclude Uston. The Court therefore continues the temporary order banning Uston from Resorts' blackjack tables for 90 days from the date of this opinion. After that time, respondent is free to play blackjack at Resorts' casino absent a valid Commission rule excluding him.​

The 90-day period expired without a new regulation having been adopted and no such regulation has been adopted since that time.

 

[slisk250]

With a big stack of chips, it is very easy to keep a BJ count with the chips behind. I know a guy who does this in WI. and does very well at his home casino.

 

[jbutler]

If it was a prosecution, i'd agree with you. But in a civil matter, I'd think there's an estoppel argument.
If they agreed to his terms, even if his terms constitute a breach of the Casino Control Act, once they agree to his terms, aren't they estopped from falling back on the CCA, when they don't like how it turned out?

No estoppel because any agreement by the parties to spread or play games with rules or procedures that conflict with the CCA would be an ultra vires act and enforcement of the agreement would be prevented due to the illegality of the agreement since it conflicts with the CCA.

 

[upNdown]

Good point

 

[DJ Mack]

@jbutler I was speaking to counting in Ohio. I'm not aware of anything making it all the way up to our Supreme Court but our casinos can and do trespass for any and all reasons except for specific protected class reasons (e.g. race, gender) but card counter is not on that list.

 

[jbutler]

With a big stack of chips, it is very easy to keep a BJ count with the chips behind. I know a guy who does this in WI. and does very well at his home casino.

I know very little about how to exactly to exploit through card counting, but the way it has been explained to me is that to have a significant edge (even with the giant unavoidable variance) is to spread your bets (i.e., bet the minimum when the count is low and enormously when the count is high) massively in a way that most casinos will not allow. This is all second hand strategy, though.

 

[DJ Mack]

That's pretty much it. Plus in order to disguise what you are doing you have to strategically take losses and even then it's not perfect. So your theoretical edge drops.

To really do it well you need a team where the counter is playing low dollar hands and signaling a confederate when it's time to enter the table. If he wins it's a hit and run. This does cross into illegal territory though when you work with another person.

The no mid shoe entry rule also cuts down on this, or at least makes the big better's actions more obvious

 

[slisk250]

The guy is a math wiz here in Saudi. We talked about the system and his count. I won't go into it but if things get +EV big time, he will raise bets from 5 dollars to just under table max so management doesn't come over.

DJ Mack hit it on the head regarding a strategy we were thinking about but...I'd rather stay out of jail and play poker.

 

[Shaggy]

I know very little about how to exactly to exploit through card counting, but the way it has been explained to me is that to have a significant edge (even with the giant unavoidable variance) is to spread your bets (i.e., bet the minimum when the count is low and enormously when the count is high) massively in a way that most casinos will not allow. This is all second hand strategy, though.

The process is quite easy... look up "blackjack hi lo count" if you want info. The key is bet spread. Bet the minimum when the house has an edge, bet bigger as your edge increases. Your max bet should be a small fraction of your total bankroll (kelley criterion etc). Getting away with betting $5 for ten hands straight then jumping to a hundred or two... now that is the challenge with card counting. That's where spotters and team play come into action. MIT blackjack and Ken Uston's Big Player concept.

Neat stuff.

 

[Shaggy]

This does cross into illegal territory though when you work with another person.

strongly disagree.

But then I less strongly disagree with the Ivey ruling. That is much more gray... but I still stand by the two playing the game as the casino presented it.

 

[jbutler]

That's pretty much it. Plus in order to disguise what you are doing you have to strategically take losses and even then it's not perfect. So your theoretical edge drops.

To really do it well you need a team where the counter is playing low dollar hands and signaling a confederate when it's time to enter the table. If he wins it's a hit and run. This does cross into illegal territory though when you work with another person.

The no mid shoe entry rule also cuts down on this, or at least makes the big better's actions more obvious

The guy is a math wiz here in Saudi. We talked about the system and his count. I won't go into it but if things get +EV big time, he will raise bets from 5 dollars to just under table max so management doesn't come over.

DJ Mack hit it on the head regarding a strategy we were thinking about but...I'd rather stay out of jail and play poker.

The process is quite easy... look up "blackjack hi lo count" if you want info. The key is bet spread. Bet the minimum when the house has an edge, bet bigger as your edge increases. Your max bet should be a small fraction of your total bankroll (kelley criterion etc). Getting away with betting $5 for ten hands straight then jumping to a hundred or two... now that is the challenge with card counting. That's where spotters and team play come into action. MIT blackjack and Ken Uston's Big Player concept.

Neat stuff.

Interesting. Yeah the guy I heard explain it was talking about working solo with no team and how tough it is, said he had been barred from a dozen or so places when he tried to spread too large.

He did say that when the casino is ultra, ultra busy that no one will monitor giant spreads since they're always understaffed and that he still plays and wins big on those nights (NYE, fight nights, etc.).

 

[DJ Mack]

strongly disagree

You can disagree philosophically but that's the law in Ohio and a few other states I've seen that our rules are based on
http://codes.ohio.gov/oac/3772-11-08v1 see division (B) which states:

(B) A person who, without the assistance of another person or without the use of a physical aid or device of any kind, uses the person's own ability to keep track of the value of cards played and uses predictions formed as a result of the tracking information in their playing and betting strategy shall not be considered to be in violation of commission rules.

 

[Shaggy]

You can disagree philosophically but that's the law in Ohio and a few other states I've seen that our rules are based on
http://codes.ohio.gov/oac/3772-11-08v1 see division (B) which states:

(B) A person who, without the assistance of another person or without the use of a physical aid or device of any kind, uses the person's own ability to keep track of the value of cards played and uses predictions formed as a result of the tracking information in their playing and betting strategy shall not be considered to be in violation of commission rules.

I know Nevada is looser. Regarding "device"... utilizing the casino chips to assist your counting strategy could be considered a "device" could it not? Still gray.

 

[DJ Mack]

I know Nevada is looser. Regarding "device"... utilizing the casino chips to assist your counting strategy could be considered a "device" could it not? Still gray.

Yeah probably. It says "any." The crux of it is this: If you cheat by violating the commission rules you are committing a crime and could go to jail. If you don't violate the rules but annoy the casino you're subject to being banned. The proof required for prosecution is high: beyond a reasonable doubt. The proof required to ban someone is nil.

The big question in the former is could an agent establish probable cause for an arrest and then would a prosecutor pursue those charges based on the available evidence? That's going to be very situational.

 

[Chicken Rob]

$9.6M. Presumably he paid tax on a lot of that money, and his accomplice walked away with her share, he may be out quite a bit if actually forced to repay this win. Plus any damages above the win amount.

I guess that is risk of being a casino scumbag (though I have no problem taking any legal advantage of a casino, casinos are scumbags unto themselves).

 

[WillAndrew]

This is absolutely ridiculous. I did not expect this ruling. Borgata explicitly agreed to the game. There was nothing "implied" about it. You lost this one because you thought you were bulletproof you greedy pricks. I'm betting that whoever agreed to Ivey's requests in the first place was excited about the Big Get and was off their game for just a second. As soon as a day passed or another set of eyes looked it over they were sweating it immediately. Horrible precedence. Go get Crockford's, Phil.

 

[jbutler]

This is absolutely ridiculous. I did not expect this ruling. Borgata explicitly agreed to the game. There was nothing "implied" about it. You lost this one because you thought you were bulletproof you greedy pricks. I'm betting that whoever agreed to Ivey's requests in the first place was excited about the Big Get and was off their game for just a second. As soon as a day passed or another set of eyes looked it over they were sweating it immediately. Horrible precedence. Go get Crockford's, Phil.

Here "implied" is sort of a misleading legalism. The agreement itself isn't implied - I think I misspoke in saying so earlier - what is implied is the term of the agreement that the game must be spread in compliance with the regulations promulgated pursuant to the Casino Control Act. The agreement was explicit. Phil asked for conditions 1-5 and the casino agreed. That agreement is an enforceable contract whether in writing or not.

Frankly if Phil was going to go through this whole thing it would have been WELL worth his time to get a gaming attorney in New Jersey to advise him before he began playing. It would cost him a vanishingly small percentage of his ultimate win in the game and he would be going in prepared to maximize the chances that whatever he does will later be deemed kosher if challenged.

Finally, the case doesn't establish a binding precedent. At this level it would be merely persuasive and so could be disregarded entirely in any subsequent litigation. And that's probably part of why the judge found for breach, but not for fraud. Contract matters are understood to be extraordinarily fact sensitive so it is extremely unlikely that another sufficiently similar case would arise that would cause this opinion to have any persuasive value whatsoever.

 

[WillAndrew]

Frankly if Phil was going to go through this whole thing it would have been WELL worth his time to get a gaming attorney in New Jersey to advise him before he began playing. It would cost him a vanishingly small percentage of his ultimate win in the game and he would be going in prepared to maximize the chances that whatever he does will later be deemed kosher if challenged.

That would almost be admitting guilt lol, but definitely this.

 

[jbutler]

That would almost be admitting guilt lol, but definitely this.

Not unusual at all for someone to get an advisory letter from a lawyer before starting a business venture which, in essence, is what Phil was doing. And the entire conversation is protected by attorney-client privilege (and, at least in New Jersey, several other protections and privileges as well).

 

[ryanb]

just know that if you make a lot of money from a casino, there's a good chance they'll find a way to get it back.

 

[WedgeRock]

U.S. poker star Phil Ivey loses UK case