Phil Ivey

Eight Surprising Details about the Phil Ivey Crockfords Ruling

By now the gambling world has heard for three weeks that prominent American poker pro Phil Ivey has lost his lawsuit against London’s swanky Crockfords Casino and its parent company, Genting Casinos UK Ltd., with the result that Crockfords will not have to pay the £7.8 million (more than USD $12 million) the casino withheld after Ivey’s extended high-stakes punto banco visit in 2012.

phil-iveyCrockfords triumphed in the case after presiding High Court justice Sir John Mitting ruled that according to British common law statutes dating back centuries, the edge-sorting tactics employed by Ivey and his companion, Cheung Yin Sun, amounted to cheating under relevant British law.  Mitting also cited the “dearth” of applicable laws and decisions, meaning that throughout all of British legal history, he didn’t really have a lot to work with.

Nonetheless, while the Phil Ivey – Crockfords ruling itself has been well reported, the actual 11-page decision published by Mr. Justice Mitting has only recently become public.  That decision includes several surprising inclusions, omissions, and deductions which helped shape the eventual course of the ruling that Mitting rendered, and are well worth sharing.  Here’s a list of the eight most surprising or underreported things about the Phil Ivey  Crockfords decision:

1) Phil Ivey was ruled against on only one of the three countering complaints brought by Crockfords in their defense, but that was enough to win the decision.

Crockfords raised three primary points as the basis for their defense.  Quoting directly from the ruling:

(1) No game of Punto Banco was in fact played because the premise on which the game proceeds, that the cards will be dealt at random, was defeated because the player knew what the first card of any coup dealt was likely to be before it was turned face up;

(2) There was an implied term that the claimant would not cheat and that term was broken;

(3) The claimant committed the criminal offence of cheating under section 42 of the Gambling Act 2005 by interfering with the game or deceiving the Crockfords’ staff and so is disentitled to found his claim on his own criminal conduct.

Mr. Justice Mitting tossed out the first assertion, writing that the game was still punto banco, even if Ivey’s manipulations changed the expected odds.

It was the second of the three points, however, that he sided with Crockfords, in that Ivey cheated via deception and thus violated whatever British gaming laws existed that could be applied in the case.  The key passages as written by Mitting:

50. [3] “… He was [manipulating the game] in circumstances in which he knew that she and her superiors did not realise the consequence of what she had done at his instigation. Accordingly, he converted a game in which the knowledge of both sides as to the likelihood that player or banker will win – in principle nil, – was equal into a game in which his knowledge is greater than that of the croupier and greater than that which she would reasonably have expected it to be.

51. This in my view is cheating for the purposes of civil law. It is immaterial that the casino could have protected itself against it by simple measures. The casino can protect itself by simple measures against cheating or legitimate advantage play. The fact that it can do so does not determine which it is.

The third point of the defense alleged criminal conduct by Ivey and Sun.  Mr. Justice Mitting dodged the entire question, writing,

… it is unnecessary for me to go on to determine the casino’s third defence. What precisely is condemned as cheating by [the criminal code] and what must be proved to make out the offence is not, in my view, clear and it would be unwise if it is unnecessary, as it is, for me to attempt to determine what that might be.

The High Court is a civil court, not a criminal one.

2) The deciding point of law, as written by Mr. Justice Mitting, is nearly 200 years old.

Mitting referred to several gambling laws on the UK books in connection with the case and his effort to determine whether the combination of edge-sorting and the ruse by Ivey and Sun of pretending to be superstitious amounted to cheating.  Mitting introduced several applicable British statutes and even referenced some from other countries, writing that nothing totally matched the circumstances of the case and that his ruling, therefore, was subjective.

Nonetheless, Mitting did cite existing gambling laws wherever he found applicability.  No law was cited more frequently than this, dating from 1845, which introduced the concept of “ill practice”:

In this jurisdiction, section 17 of the Gaming Act 1845 defined the criminal offence of cheating as: “Every person who shall, by any fraud or unlawful device or ill practice in playing at or with cards … win from any other person to himself … any sum of money …”

Mitting found that the statute still applied, and eventually construed it to have relevance to Ivey’s and Sun’s behavior.

3) The Crockfords croupier at the center of the case, Kathy Yau, did not testify.

Yau is the Mandarin-speaking dealer who was found acceptable by Ivey and Sun in response to their special request — agreed to by Crockfords — to supply such a Mandarin-speaking dealer during Ivey’s play.  Yau, acting as the Crockfords dealer, physically rotated certain cards upon request by Ivey and Sun, and followed specific instructions from the pair regarding the placement and orientation of cards throughout the discarding and reshuffling process.

All of the above was done under the “superstition” pretense offered by Ivey and Sun for their odd card-handling demands, with Yau, a low-level employee within the Crockfords heirarchy, likely told to acceded to almost any behavior by Ivey and/or Sun that did not allow either of the players to physically touch the cards.

While both plaintiffs’ and defendants attorneys assured Mr. Justice Mitting that Yau was an innocent dupe of the scheme being perpetrated by Ivey and Sun, it’s somewhat bizarre that such a core figure in a case worth millions of pounds to the winner was not called forth to testify.  Mitting himself found it unusual, writing:

A surprising and striking omission from the evidence called by Crockfords is Ms Yau.  She has not given evidence. I cannot, therefore, safely infer what, if anything, she believed to be the situation when she agreed to sort the cards differentially. I cannot safely say precisely what caused her to do that beyond accepting, as I do, that she followed house policy in doing whatever a high rolling punter requested which did not corrupt the game. She said, when interviewed about the matter by Mr. Hoskins a few days after the event, that she thought that the claimant had played fairly. She, I am satisfied, was not to any extent complicit in what occurred and was wholly ignorant of the potential consequence of turning the cards in the manner that she did.

4) According to the ruling and the recreation of the timeline of events, Ivey’s and Sun’s behavior may have been under suspicion by Crockfords security even during the disputed punto banco session.

It turned out, in a declaration made by Crockfords security during the case — and apparently undisputed by Ivey and Sun — that after losing several million pounds, Crockfords attempted to replace the suspect shoe of cards, at which time Ivey and Sun terminated play.

The relevant passage:

28. At the end of play on the early morning of the 21st the claimant asked if he could keep the same shoe, which he referred to as a deck, if he returned on the following day. He was told he could. Ms Yau returned to duty at 2 p.m. on 21st August. The claimant resumed play with the same cards at 3 p.m. and played until 6.41 p.m. His average stake was never less than £149,000. For the last three shoes it was £150,000, the maximum that he was allowed to bet each time. In the middle of play of the last shoe, Mr. Hillier told the claimant that the shoe would be replaced when it was exhausted. When it was, the claimant and Ms Sun left. By then he had won just over £7.7 million. He was provided with a receipt for that amount and told that it would be wired to him.

5) The public may never know if Crockfords security told the court a tall tale regarding their purported lack of knowledge regarding edge sorting as an advantage-play technique.

From Mitting’s ruling:

30. On 23rd August Jonathan Duffy, Head of Compliance and Money Laundering at Genting UK discerned the likely answer. He placed three cards from the Angel shoe used by the claimant and Ms. Sun on plain paper and noticed that the long edges were not identical. This caused him to remember a card trick performed by his grandfather with a pack of bordered cards on which one border was wider than the other. He arranged the pack so that all the wide-bordered edges were on one side and then asked someone to pick a card, which he put face down in the pack with the border reversed. He was able, no doubt to the surprise of the person who had put it there, to find the card simply by looking at the backs of the cards.

31. Mr. Duffy then satisfied himself that he could achieve the same outcome by placing a sorted pack of cards face down in the shoe. He then re-reviewed the CCTV footage and saw the turning over of the cards by the croupier. He eventually persuaded his colleagues, including Mr. Hoskins, that this is what had happened. Neither he nor anyone else at Crockfords had heard of edge-sorting before.

32. On 30th August the claimant spoke to Tony Pearce, Managing Director of the London casinos of Genting UK, who told him that Crockfords would not be paying his winnings because the game had been compromised. The claimant said he had not touched the cards, but did not state that which he now freely admits, that he had used the technique of edge-sorting. Arrangements were made to refund his deposited stake, £1 million, on 31st August.  [Author’s note: Though not included in Mitting’s ruling, Crockfords shortly thereafter reversed itself and refused to honor the previous arrangements on the assumption that Ivey and Sun had cheated.]

Therein may be the key phrase of the entire case: “Neither he [Duffy] nor anyone else at Crockfords had heard of edge-sorting before.”

Since Sir Justice Mitting admitted to relying on a degree of subjectivity in making his ruling, I’ll head there as well.  I’m not at all sure I buy that one.  Without making any sort of direct accusation, I’ll note that since time immemorial, employees have lied to save or protect their jobs.

The concept of edge sorting as a way to identify or differentiate certain cards from others has been around for decade, and it’s the very reason that the preferred casino method for a hand-shuffle includes the rotation of part of the deck or decks being used.  For Crockfords staff to assert that they didn’t know what edge sorting was or how it worked implies, if not dishonesty, an absolutely monstrous level of incompetence.

“Oh, yeah, my grandfather taught me this trick…,” and somehow the basis for that simple trick, a common method used by advantage players for decades, has somehow never been heard of by anyone in Crockfords security?  Again, it’s irrelevant to the basis for Mitting’s decision, but it’s either pure BS or gross stupidity.  The above tale, to the sensors on my highly attuned shit-detector, sounds rehearsed.

And that’s the most Crockfords-friendly stance any observer of the case can make.

Remember, Mr. Justice Mitting ruled that such incompetence or ignorance didn’t matter.  Ivey and Sun perpetrated a scheme, according to his decision, that entered the grounds of “ill practice,” and was thereby cheating under British civil law.  Caveat emptor.

6) No mention is made in the entire ruling of how Crockfords staff learned that Cheung Yun Sin was an edge-sorting specialist.

Early tabloid reports on Ivey’s suit against Crockfords included statements from the casino and its lawyers that Ivey’s companion had been evicted from other casinos, for unexplained reasons.  Only a year later was she fully and publicly identified as one of the world’s foremost edge-sorting practitioners, to the extent that she was known in advantage play circles as the “Queen of Sorts.”  However, Crockfords’ allegations regarding Sun were made immediately in the wake of the lawsuit becoming public knowledge, suggesting ongoing access to casino-industry surveillance information.

How did Crockfords learn of this, and when?  It was her expertise that allowed the entire chain of events to occur, and yet there’s no mention of this key aspect to the story.  Again, the pieces of the story that Crockfords presented don’t quite add up, though of course the same can be said for Ivey’s side.

 

7) The full-bleed cards exploited by Ivey and Sun in the Crockfords case were not manufactured by American cardmaker Gemaco, Inc., but were instead produced by British card manufacturer Angel Co. Limited for Crockfords.  

Numerous card manufacturers make casino-quality cards, and many of them also supply — subject to casino request and approval — the sort of full-bleed back designs that have been known to be susceptible to “edge sorting” manipulation for decades.  US-based Gemaco has been peripherally and inaccurately tied to the British Crockfords case in many news reports, based on the firm being a co-defendant in the similar Borgata case in the US.

Cardmakers, in general, tend to be housed in the countries where there products are actually used, more so than related lines of gambling equipment.  That’s a historic carryover from many decades ago, when playing cards were subject to special excise taxes, which were often made known to end consumers through the placement of a sticker on the outer box which sealed the contents inside.  Modern card-deck boxes in the US, for instance, often carry a similar sticker, though it is no longer a gaming-equipment tariff.

8) The formal decision remains unpublished in the applicable British online court services, and became publicly available only through a secondary channel.  

The 11-page ruling surfaced publicly only when it was recently introduced in a very similar United States case involving New Jersey’s Borgata casino.  Like Crockfords, the Borgata was the setting for a multi-million-dollar punto banco session involving Ivey and his companion, Sun, though in the Borgata case, the casino actually paid Ivey his now-contested winnings, and seeks to reclaim that money.

The ruling’s appearance within the US case confirms the ongoing legal cooperation between the attorneys for Atlantic City’s Borgata and London’s Crockfords, with the casino industry at large likely giving tacit approval, in the hopes of getting edge-sorting branded globally as a cheating tactic in all major gambling jurisdictions.

As for the original British High Court decision, the case ruling would normally be available either here, on the page for the current year’s High Court (Queen’s Bench Division) cases, or here, via the general search page for the UK’s Courts and Tribunals Judiciary.  That the ruling remains unpublished in the formal British legal outlets is an ongoing curiosity.

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