ATLANTIC CITY -- A federal judge has ruled that poker star Phil Ivey and a friend must repay $10 million they won at the Borgata in 2012 while employing a technique called edge-sorting to improve their odds.
The damages include $9.6 million they won edge-sorting while playing baccarat during four visits, plus $504,000 Ivey won at Craps with his winnings from Baccarat.
U.S. District Judge Noel Hillman had ruled in October that while Ivey and Cheng Yin Sun did not commit fraud, they did breach their contract with the casino and were liable for damages.
The breach was their failure to abide by the state's Casino Controls Act, which prohibits marking cards. While they did not physically mark the cards, they noticed and used tiny inconsistencies on the backs of the cards to tell whether high- orlow-valuee cards were coming up, the judge said.
"Knowing the value of the card beforehand ... dramatically increased the odds their resulting bets would beat the house," Hillman wrote in his October decision. "And beat the house they did."
Ivey, a graduate of Old Bridge High School, had countersued the Borgata, calling for the suit against him to be tossed and for compensatory damages.
He argued that it was the casino's responsibility to be aware of the inconsistencies on the cards. Noticing the inconsistencies and betting accordingly is not illegal or cheating, he argued.
In setting up the sometimes days-long Baccarat games at the Borgata, Ivey demanded that Sun sit with him at the table, that only one deck of purple Gemaco Borgata playing cards be used for all games, and that it be shuffled using an automated shuffling device, according to court documents.
When those particular cards were manufactured, they weren't perfectly symmetrical, which allowed Sun to notice a flaw on the back of the cards -- that one edge had more of the geometrical pattern than the other.
If the card was a high value, she would ask the dealer to rotate it so that the flaw would be identifiable when the card came back around.
"Baccarat is a casino game well known for unique and superstitious rituals," Hillman wrote. "Thus, Sun telling the dealer to turn a card in a certain way did not raise any red flags for Borgata."
The automated shuffling device would not disturb the orientation of the card, so as the games went on for hours, the odds became more in Ivey's favor and he placed consistently high bets.
According to court documents, Ivey won $2.4 million in 16 hours on his first visit in April 2012, with a maximum bet of $50,000. He continued to increase his maximum bet as he arranged for Baccarat games in May, July and October. On his best day, in July, he bet an average of $89,000 a hand and won $4.8 million in 16 hours, Hillman noted in his decision.
The Borgata sued Ivey after learning that a casino in London was withholding his winnings from high-stakes Punto Banco games. The game is "essentially the same as Baccarat," the judge wrote, and Ivey had made the same requests he made to the Borgata about the cards and Sun's presence.
After Hillman ruled that Ivey and Sun violated their contract with the Borgata, the casino filed a brief suggesting two different ways the damages should be calculated.
One called for Ivey and Sun to pay another $5.4 million on top of the $10.1 million, based on a theory of what the casino would have won if the odds had not been adjusted in the players' favor.
"It is simply too speculative to fashion an appropriate remedy," Hillman wrote.
He opted instead to order the payment of $10.1 million that Ivey won in Baccarat and, later, playing Craps with his winnings. He also refused the Borgata's request that the pair repay $249,199 in "comps" that the casino gave them.
http://www.nj.com/atlantic/index.ss...red_to_repay_10m_to_atlantic_city_casino.html
The damages include $9.6 million they won edge-sorting while playing baccarat during four visits, plus $504,000 Ivey won at Craps with his winnings from Baccarat.
U.S. District Judge Noel Hillman had ruled in October that while Ivey and Cheng Yin Sun did not commit fraud, they did breach their contract with the casino and were liable for damages.
The breach was their failure to abide by the state's Casino Controls Act, which prohibits marking cards. While they did not physically mark the cards, they noticed and used tiny inconsistencies on the backs of the cards to tell whether high- orlow-valuee cards were coming up, the judge said.
"Knowing the value of the card beforehand ... dramatically increased the odds their resulting bets would beat the house," Hillman wrote in his October decision. "And beat the house they did."
Ivey, a graduate of Old Bridge High School, had countersued the Borgata, calling for the suit against him to be tossed and for compensatory damages.
He argued that it was the casino's responsibility to be aware of the inconsistencies on the cards. Noticing the inconsistencies and betting accordingly is not illegal or cheating, he argued.
In setting up the sometimes days-long Baccarat games at the Borgata, Ivey demanded that Sun sit with him at the table, that only one deck of purple Gemaco Borgata playing cards be used for all games, and that it be shuffled using an automated shuffling device, according to court documents.
When those particular cards were manufactured, they weren't perfectly symmetrical, which allowed Sun to notice a flaw on the back of the cards -- that one edge had more of the geometrical pattern than the other.
If the card was a high value, she would ask the dealer to rotate it so that the flaw would be identifiable when the card came back around.
"Baccarat is a casino game well known for unique and superstitious rituals," Hillman wrote. "Thus, Sun telling the dealer to turn a card in a certain way did not raise any red flags for Borgata."
The automated shuffling device would not disturb the orientation of the card, so as the games went on for hours, the odds became more in Ivey's favor and he placed consistently high bets.
According to court documents, Ivey won $2.4 million in 16 hours on his first visit in April 2012, with a maximum bet of $50,000. He continued to increase his maximum bet as he arranged for Baccarat games in May, July and October. On his best day, in July, he bet an average of $89,000 a hand and won $4.8 million in 16 hours, Hillman noted in his decision.
The Borgata sued Ivey after learning that a casino in London was withholding his winnings from high-stakes Punto Banco games. The game is "essentially the same as Baccarat," the judge wrote, and Ivey had made the same requests he made to the Borgata about the cards and Sun's presence.
After Hillman ruled that Ivey and Sun violated their contract with the Borgata, the casino filed a brief suggesting two different ways the damages should be calculated.
One called for Ivey and Sun to pay another $5.4 million on top of the $10.1 million, based on a theory of what the casino would have won if the odds had not been adjusted in the players' favor.
"It is simply too speculative to fashion an appropriate remedy," Hillman wrote.
He opted instead to order the payment of $10.1 million that Ivey won in Baccarat and, later, playing Craps with his winnings. He also refused the Borgata's request that the pair repay $249,199 in "comps" that the casino gave them.
http://www.nj.com/atlantic/index.ss...red_to_repay_10m_to_atlantic_city_casino.html
