Borgata Phil Ivey

Ivey, Borgata Attorneys Argue in First New Jersey Appellate Hearing

Legal counsel for prominent poker pro Phil Ivey and New Jersey’s Borgata Hotel Casino & Spa have squared off for the first time in a live court hearing in the appeal of the $10.13 judgment levied against Ivey and a co-defendant in late 2016 in the two sides’ high-profile “edge sorting” case.

On Tuesday, the attorneys for Ivey and the Borgata appeared before U.S. Third Circuit Court of Appeals Judge Marjorie Rendell, with one of the major points brought up being the failure of New Jersey’s Casino Control Commission and Division of Gaming Enforcement (DGE) to contribute anything significant to the the appellate matter. Both agencies were invited in August by Judge Rendell to submit amicus (“friend of the court”) briefs to the appellate case, and though both responded formally, neither commented significantly beyond explaining each agency’s own legal restrictions.

Phil IveyIn a four-page response obtained by Flushdraw, the DGE’s executive director, David L. Rebuck, noted that while primary jurisdiction rests with the DGE and CCC, “The legislation did not intend to preclude patrons from common-law claims in the courts.” Rebuck also noted that it was the court system, and neither the DGE nor the CCC, that had “primary jurisdiction” as to whether an action such as the edge-sorting undertaken by Ivey and co-defendant “Kelly” Cheung Yin Sun constituted cheating in the legal sense.

Rebuck wrote:

In [a prior case], the New Jersey Supreme Court likewise refused to vest primary jurisdiction in either the Division or the Commission with regard to factual determinations as to whether cheating had occurred. Whether alleged cheating is being prosecuted as a criminal violation of the Act or whether the alleged cheating forms the basis of a monetary claim, a decision as to whether cheating occurred is a question of fact to be determined by a jury. The Division’s role is limited to determining whether a casino licensee has violated a regulation by not complying with the rules of a game, including as to any failure to pay a patron whose wager is a winner. However, the New Jersey Supreme Court reversed a lower court decision when the lower court opined that the doctrine of primary jurisdiction divested the courts of jurisdiction to award damages for a violation of the Act. … Deference to the Division’s interpretation of the Act and the rules promulgated thereunder is limited to issues regarding civil penalties and other issues which implicate administrative penalties. Courts should not refrain from hearing matters under the doctrine of primary jurisdiction that involves questions of fact for a jury or the awarding of civil damages.

In an even shorter two-page reply, attorney Dianna W. Fauntleroy, representing New Jersey’s Casino Control Commission, declared that the CCC no longer had relevant jursidictional responsibilities following changes made to New Jersey’s gambling laws in 2011. As such, Fauntleroy declared, the CCC had to pass on the opportunity to provide any such amicus brief.

The two agencies’ passing of the legal burden wasn’t lost on the attorneys for both sides nor on presiding Judge Rendell. Rendell, according to New Jersey gambling-beat writer John Brennan, who was present for Tuesday’s hearing, stated, “[T]he commission should have spoken on this. … They’re putting [the case] in our lap.”

The full minutes of Tuesday’s hearing remain under court seal, though the DGE and CCC responses to the amicus requests are now part of the public record. Ivey counsel Louis M. Barbone noted during the hearing that when investigating the matter back in 2012 and 2013, the DGE “did nothing”. Court documents submitted during the original case showed that the DGE and the New Jersey State Patrol investigated the circumstances of Ivey’s and Sun’s four multi-day visits to the Borgata in 2010-12, though neither of those two agencies appear to have made recommendations to the New Jersey Attorney General’s office for any possible criminal prosecution of the pair.

That left it up to the Borgata to pursue its claims against Ivey and Sun as a civil matter, which is line with the legal pathway Rebuck outlined in his response to the August amicus request.


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