Self-described gambling addiction sufferer Sam Antar will appeal the Jan. 31 dismissal of his lawsuit accusing BetMGM and Borgata Online of predatory practices leading him to lose millions of dollars. On Feb. 26, his lawyer, Matthew Pitt, filed a notice to appeal to the Court of Appeals for the Third Circuit, asking the case to be reinstated. Litt argues the defendants violated the New Jersey Consumer Fraud Act (CFA). Convincing the Third Circuit to overturn the District Court may be difficult, however, as the latter’s decision was expressly based on earlier Circuit rulings.
BetMGM Casino and Borgata Online operate as a joint venture between MGM Resorts International and Entain. In the suit, Antar alleged that the sites and their owners exploited his gambling addiction. He claimed he lost $30 million in the nine months from May 2019 to January 2020.
Antar accused the defendants of violating the CFA, negligence, and unjust enrichment. He claims they were aware of his addiction but enticed him to gamble with bonus offers, VIP treatment, and other benefits.
On Jan. 31, District Court Judge Madeline Cox Arleo sided with the defendants and dismissed Antar’s claims. Her ruling sparked controversy and commentary from the mainstream media and gambling press due to some apparent shade cast in the direction of the New Jersey legislature:
Despite the inclusion of gambling addiction as a substance addiction disorder in the DSM 5, the New Jersey legislature, as the Court has already noted, has not yet seen fit to require casinos to prevent or stop inducing gambling from those that exhibit problem gambling behavior.
Judge Says the CFA Does Not Apply
In her decision, Judge Arleo stated that the CFA does not apply to the case because the Casino Control Act (CCA) regulations governing gambling operators take priority. Antar’s legal team attempted to use another case, Bandler v. Landry’s, to establish a precedent for applying the CFA rather than CCA to a gambling operator. However, Judge Arleo rejected that argument, stating that the Landry’s case related to advertising practices and that the specific ads in question were not gaming-related.
The CFA applies only to issues not treated with more specificity by other regulations. The CCA sets out rules on the responsibilities of casinos toward compulsive gambling. These include:
- Requiring fees that contribute to funding efforts for treatment and educating problem gamblers.
- Mandating operators to file detailed procedures on reporting problem gamblers with the New Jersey Division of Gaming Enforcement.
- Requiring casinos to notify problem gamblers of and direct them to problem gambling resources.
- Requiring online operators to generate, review, and document weekly actions to identify problem gamblers.
- Providing a comprehensive regulatory scheme for problem gamblers to place themselves on self-exclusion lists.
Judge Cox Arleo added,
Notably, the CCA is silent on whether casinos or online gambling platforms may induce people who present with compulsive gambling behavior to patronize their businesses.
Negligence Claim Also Dismissed
While Judge Cox Arleo found the CCA to supersede CFA in Antar’s CFA claim, she ruled that the CCA does not preempt Antar’s negligence claim. However, she dismissed that claim on separate grounds. She wrote that the plaintiff failed to show the defendants owed a duty of care to him as a matter of law.
The judge sided with the defendants that New Jersey courts have not recognized a common law duty of care for casinos to identify and exclude compulsive gamblers. She wrote,
Given that the New Jersey Supreme Court has not yet addressed whether such a duty exists, this Court “must be governed by a prediction of how the state’s highest court would decide were it confronted with the problem.
The judge referenced two cases, Hakimoglu v. Trump Taj Mahal Associates and Taveras v. Resorts International Hotel, both of which were based on claims similar to Antar’s.
Antar’s Appeal To Third Circuit Could Be Difficult
Antar is likely facing an uphill battle with his appeal. Such lawsuits haven’t typically been successful in the US. What’s more, Judge Arleo’s verdict was partly based on previous rulings by the same Third Circuit to which Antar is appealing.
In the Hakimoglu v. Trump Taj Mahal Assocs., the plaintiff claimed the casino “intentionally and maliciously enticed him to gamble” by offering him free drinks and other perks. He added after he was clearly intoxicated, the defendant let him continue to gamble for prolonged periods. The Court of Appeals for the Third Circuit sided with the District Court judge and ruled that casinos don’t owe a duty of care to patrons.
The other case referenced in Antar’s suit also based its decision on the appellate court’s ruling in the Hakimoglu case. In Taveras v. Resorts Int’l Hotel, which resembles Antar’s case, the plaintiff claimed she was a compulsive gambler, and the failure of the defendant to stop her gambling led to a loss of money and emotional injury.
Judge Arleo noted Antar’s claims that the defendants had enough information to determine he was a compulsive gambler and stop him. However, she added:
But this is precisely the type of conduct alleged in Taveras and very similar to the type of conduct in Hakimoglu, both of which held that the New Jersey Supreme Court would not find such a duty to exist.
To be successful in his appeal, Antar and his team would need the Third Circuit to disagree with Judge Arleo about the similarities between the cases.
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