A Complete Guide to Borgata’s Phil Ivey Lawsuit — Updated Regularly

Poker superstar Phil Ivey is one of the most successful and revered poker players ever to play the game. However, his legal troubles with Borgata Hotel Casino & Spa have largely overshadowed his accomplishments on the felt in recent years. Below is the complete history of his battle with the Atlantic City casino.

The latest on the Phil Ivey lawsuit

Ivey and his legal team have hit back against the Borgata’s crusade. The poker pro filed an 800-page appeal to the 3rd District US Court of Appeals on March 18.

The appeal seeks to reargue most of the key points from the initial trial. Ivey continues to contest the notion that he or Sun manipulated the game or the cards. Furthermore, he refutes the assertion that he violated New Jersey’s Casino Control Act because there was never any formal investigation of that claim.

Finally, the appeal maintains that the district court should have applied a statute of limitations on Borgata to file a claim. Needless to say, the appeal is seeking relief from the lower court’s $10.16 million judgment against Ivey and Sun.

Last updated: April 2, 2019

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The timeline of Ivey’s fight with Borgata

This disagreement between the Atlantic City casino and Ivey is now in its seventh year. The entire quarrel stems from an August 2012 incident at Borgata’s high-limit baccarat table.

Background

Edge sorting

The crux of this entire battle has centered around a controversial practice known as “edge sorting.” In essence, a player who uses edge sorting can detect asymmetries in the manufacturer’s patterns on the backs of playing cards.

Using various memory tricks and mnemonics, the edge sorter then assigns the appropriate card value to each distinct pattern. Needless to say, these mental gymnastics can allow the player to anticipate the value of upcoming cards.

This practice is one of the tools of casino patrons known as “advantage players.” An advantage player seeks to find the quirks and idiosyncrasies in casino games that would yield situations profitable for the players.

Kelly Sun is one of these players. Before meeting Ivey, she developed a reputation in the gaming community for her edge sorting abilities relating to baccarat.

Why baccarat?

Baccarat is one of the simplest games in the casino. Its natural house advantage is less than one percent.

Sun’s edge sorting ability allowed her to flip that advantage on its head. At full power, her technique could yield a 6.5 percent advantage to the player.

However, she needed financial backing to hit the casino for real money. That’s where Ivey came into the picture.

The two met through mutual connections. From those meetings, the new partnership developed a plan to take the house down.

Conditions for play

Ivey’s tremendous bankroll and reputation meant that they could receive white-glove treatment from any casino they chose. This consideration from the staff was crucial to the success of the plan.

For Sun to edge sort accurately, she required that the casino meet four conditions:

  • The dealer must speak Cantonese. Sun wanted a dealer with whom she could speak in her native language, to be sure. However, the addition of an Asian dealer would lend veracity to Sun’s next two requests as mere superstition (common to Asian cultures), rather than a calculated plan.
  • The dealer had to shuffle and sort cards in a specific manner. Sun needed the cards arranged in a certain way to see the variations properly.
  • The deck could not change at any point. Obviously, Sun didn’t want to have to try and learn a new set of variations every hour or so.
  • Instead of baccarat, they had to play mini-baccarat. Mini-baccarat proceeds like the normal version of the game, with one notable exception. Specifically, the dealer is the only one to touch the cards in mini-baccarat. Presumably, Sun and Ivey believed that they would not run afoul of gaming authorities and courts if they never touched.

Just from a layman’s point of view, two of these requests should have caused concern to casino staff. The simplest explanation for the players’ insistence upon specific sorting styles and retention of the deck is decidedly not mere player superstition.

However, neither of the two targeted casinos, Borgata and Crockfords, rejected any of the four requests. The profit potential of getting a shot at Ivey’s bankroll likely proved too great to ignore, and neither property wanted Ivey and Sun to walk immediately out of the door.

2012

The pair first put their plan into motion in April.

Borgata became the duo’s most frequent target. Beginning with the April session, the pair hit the Atlantic City property four times.

In that time, Ivey and Sun managed to take $9.6 million from Borgata in baccarat alone. Ivey then used his winnings on the casino’s craps table to win an extra $560,000. Each time, Borgata dutifully paid out its losses to the poker superstar and his Asian partner.

After three hits on Borgata, the pair decided to vary their venue. In August, they entered Crockfords in London because its old-school sensibilities meant that the staff would cater to them extensively.

The pair began playing for the English equivalent of $150,000 per hand. Less than 24 hours later, Ivey and Sun were up by roughly $12 million.

The casino finally decided that a deck change was in order. Immediately, the two players concluded their game, accepted a receipt for the money and left the casino entirely.

Ultimately, Crockfords reviewed its security footage and elected not to wire the money to Ivey and Sun. In the meantime, the two played their fifth, and last, session of baccarat together at their old Borgata stomping grounds.

Altogether, Ivey and Sun took the two casinos for about $22.16 million. However, the collection of those funds has proved far more difficult.

2014

Needless to say, Ivey was disturbed by Crockfords’ decision to keep his winnings. So, in 2014, he took the casino and its parent company, Genting UK, into a British court to seek relief.

In his court arguments, Ivey defended the practice of edge sorting and denied any wrongdoing on his or Sun’s part. He argued that Crockfords allowed him to create a favorable situation for himself, and he took advantage of their naivete and greed.

Unfortunately, the UK court disagreed with Ivey’s assertions. The legal authority upheld Crockfords’ refusal to honor the win, but did allow Ivey the opportunity to appeal the decision.

Ivey immediately appealed.

2016

While Ivey navigated through the British appellate process, he was also answering Borgata’s legal challenge. Unlike Crockfords, Borgata had actually paid out its losses to Ivey.

As a result, Ivey was the target of a suit in the US, rather than the bringer of one in the UK. However, Borgata’s claims ranged deeper than claiming that Ivey and Sun merely cheated.

In fact, Borgata’s legal team alleged that the pair a) committed fraud, and b) violated the Racketeer Influenced and Corrupt Organizations, or RICO, Act. These allegations are notable because, if determined to be accurate, they would allow the court to treble its awarded damages to Borgata.

In other words, a $10.16 million judgment against Ivey could have quickly ballooned to over $30 million. Fortunately for Ivey and Sun, the judge dismissed the fraud and RICO allegations. Unfortunately, however, Hillman did find that Ivey and Sun had breached their contract with Borgata under the auspices of the New Jersey Casino Control Act (N.J.S.A. 5:12-1, et seq.), they needed to return the money they won.

Ivey then gave notice that he intended to appeal the decision, and began attempting to delay making a payment to Borgata until the resolution of his appeal.

2017

However, before Ivey’s appeal could proceed, another legal proceeding had to take place. Borgata’s anger over the 2012 loss did not stop with Ivey and Sun; the Atlantic City casino also sought damages from the card manufacturer, Gemaco.

In fact, Borgata filed suit to that effect during the summer of 2017. The suit alleged that Gemaco knowingly sold defective cards to Borgata.

In October, Gemaco cross-filed for a summary judgment that denied the casino’s charges. While this suit played out in court, Borgata and Phil Ivey’s teams entered into something resembling a holding pattern.

Meanwhile, across the pond, Ivey found out that he would not recoup his winnings from Crockfords Casino. The United Kingdom Supreme Court unanimously ruled against the poker pro and Kelly Sun, stating that the pair “took positive steps to fix the deck,” and that their actions constituted “a carefully planned and executed sting.”

While UK jurisprudence has no provenance in American courts, the loss cast a sensation of foreboding on Ivey and Sun’s chances on this side of the Atlantic Ocean.

2018

In March, Hillman ruled in favor of Gemaco, saying that the card manufacturer was not liable for the incident at Borgata. This ruling was something of a double-edged sword for Ivey and Sun.

On the one hand, with Gemaco out of the way, Ivey et al. were now free to pursue their appeal of the $10.16 million judgment. On the other hand, Borgata now had the green light to attempt to collect the amount of the judgment, and Ivey cannot proceed with his appeal without posting a bond for the judgment amount.

Ivey’s legal team attempted to delay that collection until after the appeal, saying that the loss of money would cause “irreparable harm” to Ivey and Sun, and the “enormity of that amount would clearly be of devastating impact.”

Borgata responded in August, decrying Ivey’s claims and suggesting that the judgment would not preclude him from playing poker in any way. They cited his participation in the 2018 World Series of Poker as evidence of his liquidity.

Hillman agreed with Borgata and denied the motion to stay the judgment pending appeal. However, Borgata’s lawyers were not finished with their filings for the year.

They cross-filed an appeal with the Third Circuit Court of Appeals regarding the elements of the original suit that Hillman ruled against them. Specifically, Borgata is looking to have the claims of RICO violations and fraud reinstated so that it can pursue trebled damages against Ivey and Sun.

2019

One of Ivey’s tactics to avoid payment of the judgment was to claim insufficient assets in New Jersey. However, according to a February ruling, that argument no longer holds water.

Hillman ruled that Borgata may now pursue Ivey’s Nevada assets in its attempts to satisfy the judgment amount it has against him. Borgata attorneys have alleged that Ivey’s Nevada assets alone may be worth more than $100 million.

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