Casino news source: Indianapolis Star - http://www.indystar.com
Gambler sues Indiana casino over enticements
By Grace Schneider
Louisville Courier-Journal
Jenny Kephart's fondness for the blackjack table took her to a world of private jet rides, her own table and dealer in casinos, and lavish hotel suites where iced champagne awaited her arrival.
"My every whim," recalled Kephart, 52, of suburban Nashville, Tenn., who now admits she was a compulsive gambler. She said she has lost more than $900,000 at casinos across the country.
Eventually, her gambling brought her to Caesars Indiana in Harrison County and put her deep in debt. The casino filed a lawsuit against her in January for failing to repay $125,000 she had borrowed during a March 2006 visit to the riverboat owned by Harrah's, a company that had been making her special offers for years.
But Kephart, who is unemployed, is fighting back with a counterclaim alleging that Caesars enticed her with giveaways and made money for gambling available to her, even though trained casino workers should have identified her as a problem gambler and casino executives knew she had come out of bankruptcy just four years earlier, when Harrah's was one of her creditors.
Caesars' lawyer, Stephen Langdon of Frost Brown and Todd in New Albany, Ind., argued in court and in filings that Kephart never asked to be banned from the casino or other properties run by Harrah's, so the casino had no way to know that she was a problem gambler.
The casino lawyers declined to comment further about the case.
On Wednesday, Judge H. Lloyd Whitis in Harrison Circuit Court heard their motion to dismiss Kephart's counterclaim. He is expected to rule in a month or so.
Kephart's case centers on whether a casino has a duty to protect an addicted gambler from himself or herself.
Her lawyer, Terry Noffsinger of Evansville, contends that pathological gambling is widely viewed as a mental illness. He argued that Caesars' representatives knew that Kephart couldn't control her gambling binges but still took "affirmative steps to persuade her to gamble" by calling her at home and offering her credit and complimentary hotel rooms, meals and limousine rides.
In similar cases, Indiana courts have held that casino operators don't have to prevent customers from gambling and consequently aren't responsible for their losses.
But Noffsinger stressed that the law is not fully settled in cases involving problem gambling.
"If she had just gone in (to Caesars) on her own, that would be one thing," he said. Instead, he told the judge Wednesday, he intends to prove that casino officials knew that Kephart was an addicted gambler and that they pursued her because she had money to spare from a $1 million inheritance she received in 2004.
Indiana gambling regulations allow casinos to lend money to people it deems credit-worthy. The Indiana Gaming Commission has declined in the past to disclose the amount of credit that individual casinos extend to patrons, citing privacy law and trade secrets.
Noffsinger previously represented Evansville resident and professed gambling addict David Williams in a federal lawsuit in which the precedent that casinos have no duty to protect a compulsive gambler from himself was upheld.
California lawyer I. Nelson Rose, a gambling-law expert, said he believes the court precedent is well established. He also said many wealthy gamblers are offered credit of hundreds of thousands of dollars, so Caesars' decision to lend Kephart large sums is not unusual.
But Noffsinger said he believes Kephart's case is different because Caesars sued her first, and the casino invited her to visit.
In an interview at her home last week, Kephart said she decided to fight the claim against her because she thinks Caesars took advantage of her. "They knew I had money, and they went after it," she said.
The native of Omaha, Neb., first began gambling more than a decade ago while working as a dealer at a casino in Council Bluffs, Iowa, she said. Employees by law can't gamble where they work, so she went to the Harrah's-owned casino next door.
It was a fun diversion for a while, Kephart said, but soon playing blackjack became an obsession and she would stay at the tables for hours without taking time to eat or sleep.
Like a lot of problem gamblers, Kephart said, she would keep going back after losing to try to recoup her losses. But she only dug herself deeper into debt, often concealing the size of the losses from her husband.
Fueled by those losses, she said, the couple filed for bankruptcy in late 2001. Among their debts was $20,000 owed to Harrah's in Iowa.
For the next three years, Kephart said, they made court-structured payments on the debts. But then she received the inheritance.
Her newfound wealth was no secret at Harrah's, Kephart said, since she had a relative working there. She said other employees told her she was welcome to come back even though she had not paid all the money she owed the casino. She said she was told that her slate there was wiped clean.
After the Kepharts moved to Tennessee three years ago to be closer to her family, Harrah's resorts in the region -- including Caesars Indiana and casinos at Metropolis, Ill., and Tunica, Miss. -- began calling to offer free rooms and other perks, she said.
"For a whole year, I spent all my time going back and forth to casinos," she said.
All told, she figures she lost at least $905,000 gambling. Some nights she would lose tens of thousands of dollars, including once in late 2005 when she lost $240,000, she said.
Bob Kephart said he didn't know how much money his wife was gambling away.
"If I thought for one minute it was this much, I'd have asked them (casino officials)" to ban her, he said.
But under self-exclusion rules in most states, including Indiana, such requests are valid only if made by the gambler -- not spouses or family members.
Jenny Kephart said she didn't ask to be banned because she didn't realize how seriously addicted she had become. Once her savings were gone, she said, she mortgaged her family's home -- property that she and her husband had owned outright -- to repay gambling debts.
She said her bankruptcy history got her rejected when she applied for credit cards. But Harrah's officials arranged a line of credit for her, explaining that it was safer for her not to carry large amounts of cash into the casino, she said.
According to court records, Caesars granted her a $100,000 line of credit in February 2006.
Kephart said she repaid that. But on a final trip to the riverboat on March 18, 2006, she received a second $100,000 in the form of six marker checks. When that was gone after an overnight marathon at the tables, casino officials arranged for her to get $25,000 more, she said.
"It was daylight out" by the time she wandered back to her hotel room dazed, exhausted and broke, she said.
If Caesars prevails, the court could award the casino three times the amount of the unpaid claim, plus legal fees.
Kephart said she now steers clear of gambling and is trying to rebuild her life. But she said she still feels overwhelmed by her predicament.
"I'm really scared about what's going to happen with all this," she said. But, "I am out of money, completely out of money."
Reporter Grace Schneider can be reached at (812) 949-4040. |
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