Chumba Casino Lawsuit
February 2019 was not kind to poker superstar Phil Ivey, and it has nothing to do with how things went on the table. Ivey suffered a significant setback in his ongoing legal battle and lost his namesake poker room on the Strip.
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To refresh, Ivey and Borgata Hotel, Casino & Spa have been embroiled in a dispute for nearly seven years. The issue at hand is a series of Baccarat sessions in which Ivey managed to win $9.6 million.
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In order to accomplish this major score, Ivey and a partner, Cheung Yin “Kelly” Sun, employed a controversial technique known as “edge sorting.” Borgata has sued Ivey for fraud and breach of contract due to this practice, which involves using discrepancies in the manufacturer’s design on the backs of cards to determine their value.
So far, the Atlantic City casino’s lawsuit has been somewhat successful in court. The judge agreed that Ivey did breach his contract as specified under the New Jersey Casino Control Act.
Ivey has pledged to appeal the decision, of course. However, after the judgment, Borgata could seek restitution for $10.16 million, which includes the $9.6 million and an extra $560,000 that Ivey won playing craps afterward.
Borgata can now pursue poker pro Phil Ivey outside of New Jersey
Up until now, Borgata had been stymied in its pursuit of Ivey’s money because Ivey had no major assets in the state of New Jersey. However, the same judge ruled that Borgata could pursue Ivey’s assets outside of New Jersey in the first part of February 2019.
It is not clear what remedy Borgata will use to satisfy the amount of the judgment. However, there is speculation that the casino will look towards Ivey’s Nevada assets, which are said to be plentiful. It is not outside the realm of possibility that Ivey would have to sell some assets to acquire the appropriate amount of cash.
Things could still get worse for Ivey
One might think that things are at a nadir for Ivey right now. He was a famed poker legend–a reputation that has now been tarnished amid drama that seems to be neverending. Now Borgata (and MGM) are attempting to make things much worse for the poker star.
Borgata’s initially claimed three grievances against Ivey–fraud, breach of contract, and what’s known as a RICO violation. A RICO violation occurs when various persons break the Racketeer Influenced and Corrupt Organizations Act, or RICO Act.
The RICO Act punishes persons who engage in criminal acts as part of a criminal organization. Prosecutors and law enforcement use RICO more commonly against members of the Mafia and other criminal gang organizations.
Chumba Casino Lawsuits
In effect, Borgata is alleging that the partnership between Ivey and Sun constitutes a criminal organization. So, their use of edge sorting would qualify as a RICO violation.
If a judge rules that a claimant is in violation of RICO, the person(s) are subject to a mandatory trebling of damages. In other words, Borgata sought to triple the $10.16 million judgment to over $30 million.
Now, initially, the judge ruled that Ivey did not commit fraud or a RICO violation, thus sparing him from this ballooning of the judgment amount. However, Borgata recently cross-appealed the judgment, seeking to reinstate those two allegations against Ivey.
So, things could get much worse for Ivey before they get better. Potentially, they could get $20 million worse.
Aria changes Ivey’s Room to Table 1
Chumba Casino Lawsuit
As if that wasn’t a big enough blow, Ivey also lost his namesake high-limit room, Ivey’s Room, at Aria Hotel and Casino in Las Vegas. Aria renamed the signature area to Table 1 on Feb. 21.
The Ivey Room at Aria is now known as Table 1.
The Ivey Room has relocated to U.S. District Court in New Jersey.
— Norman Chad (@NormanChad) February 21, 2019
Of course, Borgata and Aria are both MGM Resorts properties. While Aria gave no specific reason for the name switch, most people can read between the lines.
Quite frankly, MGM was in a bind about the name either way. The company could not leave Ivey’s name prominently featured at one of its properties with an ongoing lawsuit against him.
We’ll have to wait and see exactly where this lawsuit goes–and if he encounters any more blows along the way.