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Borgata Files Motion to Dismiss in WPO ‘Final 27’ Case

Pre-trial proceedings are continuing in the case of the six “Final 27” poker players who have alleged negligence by Atlantic City’s Borgata Hotel Casino & Spa in connection with the 2014 Borgata Winter Poker Open event eventually cancelled by order of New Jersey gaming authorities.

The latest developments in the case, which was initially filed last month by New Jersey attorney Maurice “Mac” VerStandig, include the filing of a motion to dismiss by the Borgata’s atorneys and a countering brief by VerStandig rebutting the Borgata’s dismissal motion.  Among VerStandig’s countering assertions is that the Borgata has judicially estopped itself from seeking dismissal by claiming that gaming authorities have sole jurisdiction in the case, since the casino has concurrently prosecuted its own civil lawsuits in other matters, including a well-publicized $9 million “edge sorting” lawsuit against poker pro Phil Ivey.

The six plaintiffs in the lawsuit are among 27 players who received a New Jersey Division of Gaming Enforcement-ordered settlement in the event tainted by a large number of counterfeit chips allegedly introduced by North Carolina player Christian Lusardi.  Tournament officials did not discover the more than 160 fake “5,000”-denomination chips for more than a day after they were first introduced into the tournament.

borgata-logoThe six defendants — Duane Haughton, Michael Sneideman, Cuong C. Tran, Cuong V. Phung, Alvin Vatanavan and Christopher Korres — each received $19,323, far less than the $53,079.44 each of the final 27 players would have received had an equal chop of the remaining $1.4 million in prize money been ordered.

Instead, the DGE’s ruling allowed the Borgata to distribute more than $900,000 of that remaining prize fund to over 2,000 other tournament entrants who busted before making the money, despite the mathematical surety that the Borgata massively overstated the number of players who could have been affected by the alleged Lusardi cheating, apparently by declaring anyone in the same room as being potentially tainted without a review of table-to-table player transfers.

One effect of that overstating of potential tainting was to potentially short-circuit another lawsuit by players in the corrupted event, a class-action lawsuit brought on behalf of non-cashing player Jacob Musterel.

In its latest filing, the Borgata claims that “jurisdiction over the matter in controversy in this case falls squarely within the statutory delegation to the Division of Gaming Enforcement.”  The Borgata’s legal argument is that since the casino’s gambling activities are regulated by the DGE and that the DGE already issued a ruling in the matter, the players have no legal case basis for bringing a lawsuit via general court.

Instead, argued the Borgata’s attorney, Russell L. Lichtenstein, the players have the right to seek judicial review of the DGE decision by filing an appeal with the New Jersey Supreme Court.

On behalf of the players, VerStandig swiftly filed a countering brief pointing out several legal inconsistencies with the Borgata’s assertions.  VerStandig offered three major points: (1) Lichtenstein and the Borgata have intentionally overstated the reach of the DGE’s jurisdiction regarding casino-vs.-player disputes; (2) the appellate solution proposed by the Borgata is unconstitutional, as it would deny the plaintiffs the right to a jury trial, as guaranteed under New Jersey law; and (3) the Borgata can’t go around dragging players into court on gambling claims, as it did with Ivey and his companion in the ongoing mini-baccarat “edge sorting” case.

VerStandig even attached several documents from the Borgata-Ivey case which directly reference the Borgata’s case as being built in part upon New Jersey gaming regulations.  The intent is to illustrate the casino’s estoppel, in that it can’t use both sides of the same legal argument in separate cases.

VerStandig also pointed out that the decision in one of the cases prominently cited in the Borgata’s motion to dismiss, Campione v. Adamar of New Jersey, Inc., actually reaches the opposite conclusion: “Our examination of the [New Jersey Casino Control] Act leads us to conclude that the Legislature did not intend to prevent patrons from seeking vindication of common-law claims in the courts.”

In an e-mail to FlushDraw, VerStandig stated, “[W]e regard the motion to dismiss as particularly unfortunate, not merely because it presents an errant recitation of applicable law, and suggests an unconstitutional scheme, but because of the hypocrisy that underlies a casino resorting to the courts to sue the likes of Phil Ivey, while simultaneously protesting that casinos and card players ought not be permitted to litigate in the courts. This is the sort of self-serving doublespeak that our judicial system has continuously refused to dignify, and we find it regrettable that, in less than a month, it has already become the Borgata’s tactic du jour in this case.”

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