Almost $1 million worth of gambling chips are in legal limbo after a court ruling Friday in a high-stakes fight over unshuffled cards at the Golden Nugget Atlantic City.
A state Superior Court judge ruled that Golden Nugget does not have to immediately pay gamblers their winnings from a disputed mini-baccarat game last year. Instead, the case will continue to be litigated.
At the same time, Judge James Isman refused to dismiss consumer-fraud claims filed by the gamblers against the casino. The gamblers contend that Golden Nugget tricked or defrauded them by refusing to pay up.
The legality of the game remains in question, because unshuffled cards were put into play during about 2.5 hours of gambling on the night of April 30. Golden Nugget has blamed the vendor that supplied the cards for not shuffling them before they were used in the mini-baccarat game.
Golden Nugget claims 14 gamblers took advantage of the unshuffled cards, increasing their bets from $10 to $5,000. As the game went on, the unshuffled cards repeatedly came out in the same pattern, allowing gamblers to win 41 consecutive hands for a total of about $1.5 million. The gamblers deny any wrongdoing.
The gamblers cashed in more than $500,000 in chips immediately after the game ended. Almost $1 million in chips have yet to be redeemed, because Golden Nugget refuses to allow the gamblers to cash them while the court fight continues.
Alluding to the unshuffled cards that came out in a predictable pattern, Golden Nugget attorney Louis Barbone argued that the mini-baccarat players exploited “an illegal game of chance because of a predetermined outcome.”
Mark Pfeffer, an attorney for one of the gamblers, criticized Golden Nugget for devising “this novel legal theory” that the game was illegal. Pfeffer told Isman that Golden Nugget refuses to pay up even though there is no evidence that the gamblers cheated.
Originally, Isman ordered the casino on Aug. 31 to pay the gamblers their disputed winnings. He also denied Golden Nugget’s request at that time for a preliminary injunction to seize all of the unredeemed gambling chips. However, he held up the actual payment of the chips pending an appeal by Golden Nugget.
But on Friday, Isman vacated his original order, saying Golden Nugget does not have to immediately pay off the $977,800 in outstanding chips while the case continues in court. Isman noted that he should not have ruled in August, because he was unaware then that counterclaims had been filed by the gamblers. He also said Golden Nugget did not have a chance then to dispute the counterclaims.
Ultimately, the court may defer to a ruling on the disputed game by the state Division of Gaming Enforcement, the chief regulatory body for Atlantic City’s casino industry. Isman disclosed in court Friday that the division has started an investigation, including issuing a subpoena for the State Police reports on the mini-baccarat game.
Golden Nugget originally sued the gamblers in an attempt to recover the casino’s losses. The gamblers, all of whom are of Asian descent, responded with countersuits claiming they are victims of racial discrimination, a charge that Golden Nugget has denied.
Golden Nugget also faces claims that it defrauded gamblers and that some of them were roughed up or illegally detained after authorities began investigating. Golden Nugget first suspected an elaborate scam was under way, but later acknowledged that the gamblers did not cheat.
The litigation includes Gemaco Inc., a Missouri-based playing card manufacturer Golden Nugget sued. Gemaco has admitted the company failed to shuffle the cards before giving them to Golden Nugget. The cards were supposed to be preshuffled at Gemaco’s factory, but were not, the company’s attorney said.
Attempts to settle all of the lawsuits have been unsuccessful. Golden Nugget’s billionaire owner, Tilman Fertitta, offered in August to pay the gamblers their disputed winnings if they dropped their litigation against the casino.
“They offered you the money on Aug. 31, didn’t they?” Isman asked of Pfeffer.
“They didn’t, actually,” Pfeffer responded, referring to Golden Nugget’s demand that the gamblers halt their suits in return for payment. “They didn’t make an unconditional offer to pay that money.”
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