Phil Ivey Settles Edge Sorting Lawsuit with the Borgata

Poker pro Phil Ivey is believed to have reached a settlement with the Borgata Atlantic City in a long-running $10-million legal battle stemming from a controversial advantage play technique the player used while playing baccarat at the casino all the way back in 2012.

NJ Online Gambling reported Wednesday that Ivey and the Atlantic City gambling venue have โ€œnow reached a settlementโ€ as per a court filing from last week with the US Court of Appeals for the Third Circuit.

Terms of the settlement that is yet to be finalized were not disclosed. According to legal experts, the settlement is not a surprising outcome, particularly after a prominent appellate attorney said that Ivey was a slight favorite to prevail in the appeal.

A Quick Timeline of the Long-Standing Case

A settlement between Ivey and the Borgata would put the end of a half-decade court saga stemming from the playerโ€™s use of edge sorting while playing baccarat at the casino in 2012 together with his playing companion Cheung Yin โ€œKellyโ€ Sun.

In April 2012, Ivey contacted the Borgata to arrange a visit and play high-stakes baccarat at the casino. Ivey requested a private area at the casino, a dealer who spoke Mandarin Chinese, an 8-deck shoe of purple Gemaco cards, and an automatic shuffling machine. In return, the player wired a $1 million deposit to the casino.

During their visit of the Borgata, Sun instructed the dealer to turn the cards in certain ways. The player was thus able to spot tiny discrepancies on the backs of the cards and use that knowledge to make informed decisions throughout the game.

Exploiting unintentional differences on the backs of the cards is known as edge sorting. Using the technique, Ivey and Sun won $9.6 million at the Borgata. The casino paid out the winnings, but filed a lawsuit against the two players in 2014, seeking to have the money returned to it.

In 2016, the US District Court for the District of New Jersey sided with the Atlantic City casino, ruling that Ivey and Sun had breached their contract with the Borgata and that the two players should return the winnings to the gambling venue and pay $500,000 in damages.

Ivey and Sun appealed the ruling in the US Court of Appeals for the Third Circuit in 2018. Up until the case was heard in the Third Circuit in September 2019, things did not look good for Ivey. Early in 2019, the Borgata was even granted clearance to go after the playerโ€™s Nevada assets.

The casino managed to collect more than $124,410 from Ivey, including his winnings from the 2019 edition of the World Series of Poker.

The Settlement

According to last weekโ€™s court filing, the case was referred to the Third Circuitโ€™s Appellate Mediation Program, following oral argument in September 2019, and the parties participated in the mediation program and have now reached a settlement.

According to multiple reports, the September hearing did not turn out well for the Borgata as the casino struggled to convince court that Ivey and Sun had marked the cards they were playing with. While the players had not marked the cards in the traditional sense, the Borgata argued that asking the dealer to turn the cards in particular way constituted marking.

The settlement between Ivey and the Borgata has been handed back to the District Court for a partial remand and โ€œthe vacatur of certain orders and decisions.โ€ If the vacatur is granted, the two parties will be able to proceed with settling their dispute.

According to legal experts, if the Borgata had lost the appeal, that would have created a dangerous precedent that would have harmed the casino and its parent company, MGM Resorts International, in future cases involving advantage play.

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