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New Jersey Gaming Regulators Issue Ruling in Borgata Counterfeit-Chip Tourney

The New Jersey Division of Gaming Enforcement today issued its final ruling regarding the 2014 Borgata Winter Poker Open event that was cancelled in January following the introduction of about 160 counterfeit high-denomination tournament chips.  Roughly two-thirds of the prize money from that event went unawarded, with 27 players remaining in the event when play was suspended, then later permanently cancelled.

borgata-logoIn the official ruling, signed by DGE Director David L. Rebuck, roughly half of the participants in the event will receive a refund of initial entry fees or a partial payment, if they were among the final 27 players, from the remaining prize fund.  Several of those final players expressed extreme disappointment at the ruling while posting on social-networking sites.  The ruling gives them only a small percentage of the prize money they believed they were competing for when play was halted on January 17th.

The Borgata was ordered to return the $288,660 it received in tournament fees from players to the distribution being sent to affected players.  In addition to the $1,433,145 remaining in the prize pool when play was halted, a total of $1,721,805 is to be distributed to players affected in some way by the cheating, for which the alleged cheater, Christian Lusardi, remains in custody.

The breakdown of the money ordered to be distributed to the players is as follows:

  • 2,143 players will receive a full refund of their $500+60 entry fees.  The majority of these players participated in the same Day 1C flight at Lusardi, who emerged as the runaway chip leader of that flight.  A few hundred of these refunds will go to players from the Day 1A and 1B flights who survived their initial day’s actions, were merged into the combined Day 2 (where Lusardi also competed), but were eliminated short of the money.  In total, $1,200,080 of the $1.722 million is to be used for these refunds.
  • 27 players who remained alive on Day 3, when action was suspended, will each receive $19,323 from the remaining $521,721, a total far smaller than the $1.433 million they believed they were still competing for when play was halted.

An additional $50,893, not part of the remaining prize fund or derives from entry expenses, will be awarded to about ten players who failed to receive their tourney winnings from the Borgata after busting late on Day 2 of the event.  Those players will receive the exact amount scheduled to be paid to them based on the event’s original payout listing, but will receive no additional refunds.

Whether or not the decision as issued by the New Jersey DGE was intended to help minimize the Borgata’s potential exposure to further legal action remains open for cynics to pursue.  The Borgata was targeted in a class-action lawsuit filed by tournament participant Jacob Musterel in late February.  Among the claims by Musterel and his attorney, Bruce LiCausi, was that the Borgata was negligent in its operation of the event, in large part because so many counterfeit chips were able to be introduced by Lusardi over nearly two days of play.

Musterel, who was eliminated before reaching the money, is likely among the 2,143 players who would be in line to receive the $560 refund being offered by the Borgata.

The ruling as issued by the New Jersey DGE includes a tacit defense of the Borgata and its operation of the cancelled event.  It states “that Borgata was in compliance with the [relevant gaming codes], specifically relating to the conduct of tournaments, and its poker tournament internal controls… .”

That statement, intentionally or not, is likely to put the onus on any of the remaining 27 players to provide the heavy burden of proof regarding possible Borgata negligence, if they chose to protest the DGE’s ruling.  Each of those players, as already noted, is scheduled to receive more than $19,000, and it is unknown if any refund or settlement arrangement will include a demand by the Borgata for indemnification against future legal action.

First place in the event was slated to be $372,123, with Allard Broedelet and Nick Guagenti the chip leaders at the time play was halted.

Check back at FlushDraw for further news on this late-breaking story.

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