Phil Ivey WSOP Battle Continues: $124K+ at Stake

A lot has been occurring within the legal battle between Phil Ivey and his backers against the Borgata Hotel Casino & Spa in New Jersey. A claim filed by Ivey’s backers, stating that the garnishment of his July 2019 World Series of Poker (WSOP) winnings by the State of Nevada should be voided out, has seen a challenge brought against it by the Borgata brand.

The Atlantic City casino wants Ivey's tournament proceeds to be turned over to itself as partial payment of the money Phil was ordered by a court to return to the Borgata several years ago. Ivey and his backers understandably don't want to see this happen. Things have intensified to the point that Borgata has introduced an MGM attorney into proceedings whilst reiterating that a garnishment notice was sent to Ivey’s Las Vegas condo, only for it to be returned as undeliverable.

Garnishment of Ivey's Winnings

The ongoing dispute focuses on the eighth-place finish by Ivey in the July WSOP $50,000 Poker Players Championship 2019. For this result, Ivey earned a total prize of $124,410 while the tournament saw fellow US poker player Phil Hui go on to claim the first-place victory.

However, that prize money was never collected by Ivey due to the fact that the Borgata Hotel Casino & Spa proceeded to submit a writ of execution to officials of the WSOP event. This claimed that the Borgata should receive any and all of his winnings from the tournament and that any payment of those winnings to Ivey would actually end up being a violation of that writ. Through this, the money was garnished by Caesars Entertainment, owner of the WSOP, and sent directly to the United States Marshals Service.

The Borgata Hotel Casino Is Pursuing Litigation Against Phil Ivey and Has Garnished His Poker Winnings

Edge-Sorting Backstory

It may seem like quite the harsh outcome after Ivey secured his eight-place finish, but the Borgata was able to proceed with this due to the outcome of the edge-sorting case that Phil lost in 2016. That judgment found that between 2010 and 2012, Ivey and his accomplice, Cheung Yin Sun, utilized edge-sorting techniques as well as a set of imperfect playing cards to win $9.6 million unfairly from the Borgata Casino. This took place through four separate sessions of baccarat, and when the establishment uncovered the scheme, Ivey was taken to court over allegations of cheating.

Poker Professional Phil Ivey

The case echoes an earlier one with Crockfords Club casino in Mayfair, London, which also involved Ivey. In Aug. 2012, it was reported that he had won £7.3 million (approx. $11 million) while participating in a game of Punto Banco at the casino. After the win, Ivey was supposedly told that the money would be wire transferred over to him at his Las Vegas residence, but it never arrived. His stake of £1 million would be returned to him though.

Phil Ivey Engaged in Edge Sorting Within the Luxurious Gaming Rooms at Crockfords

Crockfords explained that his use of edge sorting amounted to illegitimate gameplay, and despite Ivey protesting his innocence, a U.K. court ruled in favor of the casino on Oct. 8, 2014. Though Phil appealed, the lower court's decision against Ivey was upheld by the Supreme Court in October 2017.

That was the same outcome as far as the Borgata case was concerned – the legal system sided with the casino and ruled that Ivey would have to pay back $10.16 million: his baccarat winnings as well as an additional $500,000 won from playing craps with those winnings. Because the Borgata could not find any assets to collect from the poker player in New Jersey, it gained the approval of a U.S. District Court judge to have that same judgment become applicable in Nevada too. It was because of this that Ivey’s July WSOP winnings were garnished to pay that debt.

A Little More on Edge Sorting and Ivey’s Technique

Edge sorting refers to a specific technique used when playing baccarat and similar casino table games, which sees the player determine what is on the other side of a card by looking out for subtle (and unintentional) differences on the backs of them. Players utilizing this method have to closely observe the cards in play to notice those differences, learn them, and then put that knowledge to use in order to exploit them.

Ivey has employed edge sorting on at least the two occasions mentioned and potentially in even more events that he has participated in. As far as his use of it at both the Borgata and Crockfords goes, there was little doubt in the eyes of the venues and the courts that he had utilized assistance in the form of Ms. Cheung Yin Sun, also known as Kelly, to be successful in his games.

“Kelly” Cheung Yin Sun, Phil Ivey's Edge Sorting Partner

This saw Ivey put down the necessary money to make the wagers, in some cases as high as $100,000 per hand, but also request specific conditions to his gameplay. These very specific demands included having a dealer who spoke Mandarin, that the casinos only utilized playing cards from a specific brand – that being Gemaco due to the uneven patterns on the backs of the cards – and that a shuffling machine that did not spin cards was used.

It would then be up to Kelly to do the hard work, such as requesting that the dealers turn certain cards, explaining that this was for “good luck,” although in actuality, it was so that certain key cards would be instantly recognizable. The 6, 7, 8, and 9 cards all had short edges facing the dealer. Essentially, Kelly read the cards in play and informed Ivey on how to bet as a result.

Ultimately, the technique that was used and the outrageous demands by Ivey resulted in both casinos figuring out that the pro wasn’t altogether playing legitimately. However, gamblers are known to have certain superstitions, which is why requests for the turning of specific cards “for luck” went pretty much unnoticed during gameplay. While it’s not definitive that a dealer must comply with any such requests from players, in most cases, they will.

Ivey’s Poker Backers Claim Wrongful Seizure of Winnings

While the writ of execution from Borgata would give the casino the right to take control of Ivey’s winnings, what isn’t clear right now is if they’re actually all his. Professional poker players Daniel “Jungleman” Cates, who made his reputation at online poker sites as opposed to Ivey's prominence in live poker events, and Illya Trincher, who has himself fallen afoul of the law before, are backers of Ivey.

Daniel Cates (l.) and Illya Trincher (r.) Claim That They Staked Phil Ivey and Thus Deserve Their Fair Share of the Proceeds

They claim that much of the $124,410 prize belongs to them. According to both pros, a deal had been reached with Ivey that would see the full $50,000 buy-in returned to them should Ivey cash. To add to that, Cates and Trincher would receive 50% of all profit from that tournament.

Because Ivey not only won his money back, but an additional $74,410 on top, the backers claim that they should be able to receive $87,205 of the total altogether. That would amount to the buy-in and half of the additional winnings.

An objection to the garnishment of Ivey’s winnings was filed on Aug. 30 by attorney Richard A. Schonfeld who has represented Ivey in a number of other matters. Schonfeld’s Las Vegas law firm is known for dealing with gaming law. According to that objection, such staking deals as the one agreed upon by Ivey and his two backers are legal and enforceable within the state of Nevada. This argument was backed up by the log of a phone chat that took place between Cates and Trincher, which saw the two of them discuss their plans to fund Ivey’s tournament entry.

However, the Borgata has since fought back against the claim by the two, with Borgata lawyer Jeremy M. Klausner filing a declaration that details the circumstances of the garnishment of the winnings.

It didn’t take long for Schonfeld to bring the fight right back to the casino though, claiming that the garnishment action remains illegal, especially because Klausner is not licensed to operate as a lawyer in Nevada. It is the response of the Borgata lawyer that he doesn’t need to hold a license in Nevada in order to file the claim by the casino. Due to these competing claims, Ivey’s winnings from the WSOP tournament remain in possession of the U.S. Marshals Service.

Borgata Incorporates Vegas-Based Attorney to Legal Team

Despite the fact that Klausner bases himself out of New Jersey, where the Borgata Hotel Casino & Spa is, he explained his reasoning behind not needing to be licensed in Nevada solely for the purpose of filing the garnishment order. He said:

I reviewed this Court’s Local Rules governing admission pro hac vice. In the first instance, I do not believe that requesting a writ of execution even constitutes the practice of law.

Yet, Klausner has since filed a pro hac vice, which allows an unlicensed attorney to practice law within an alternative jurisdiction for a single occasion. This was done on Oct 1. 2019, and the motion was swiftly approved, granting Klausner the ability to operate as a lawyer in Nevada.

Another attorney has been added to the Borgata legal team, though, in the form of Lawrence Semenza. He, along with his firm, Semenza Kircher Rickard, which is based in Las Vegas, has been a representative for MGM Resorts in various other legal matters.

Unexpected Obstacles for Klausner Hold Up the Process

The process of being able to file the levy against Ivey’s winnings has not been an easy one for Klausner. The lawyer has spoken of various unexpected obstacles, which halted the advancement of the process, such as filing the writ via WSOP when Ivey was competing in the Poker Players Challenge, as well as the inability to serve the writ to the player’s last known address.

Klausner stated that the writ was handed over to WSOP Director Jack Effel on June 27, 2019. At the time of the writ’s delivery, which was done by the U.S. Marshals Service, Mr. Effel requested a copy of it to deliver personally to Ivey. Klausner states that a copy was handed over to him, and Mr. Effel proceeded in delivering that to Ivey. Yet, according to Nevada law, Borgata is required to mail the writ to Ivey as well.

“On June 29, I personally mailed Mr. Ivey a copy of the writ at his last known address, as required by Nevada statute,” Klausner said. The lawyer said that the address he used was provided by Ivey himself during a deposition in Atlantic City, New Jersey on Jan. 30, 2019.

However, the envelope containing the writ was found to be undeliverable to the Vegas address, which Klausner provided proof of via the Return to Sender stamp displayed on that same envelope. He then went on to request an up-to-date address from Ivey’s New Jersey-based attorney, Louis M. Barbone, on two separate occasions. He claims that his requests for such were never provided with a response.

As it happens, the Summerlin condo that was owned by Ivey in Las Vegas was reportedly sold on Oct. 9, 2018. The property was on the market for a little over a year and then was supposedly bought for a total of $1,350,000 in cash. This raises additional questions about why Ivey claimed to still be residing there three months after the date of sale.

Phil Ivey Disposed of this Real Property in October 2018

Time-Barred Counterclaim Disputed by Schonfeld

Having heard Borgata attorney Klausner’s claims of being obstructed in filing the writ, Ivey's counsel Schonfeld brought even more fight to the table against both him and Semenza. Despite the fact that Semenza had affirmed that Klausner needed no license within Nevada to file the writ, Schonfeld directly attacked that claim whilst disputing a new claim made by the MGM attorney. That claim suggests that the $87,205 figure that Cates and Trincher believe they should receive was time-barred and should therefore be dismissed as a result.

Semenza has stated that both Cates and Trincher were fully aware of the fact that Ivey’s winnings from the Poker Players Championship were frozen, and that they knew this by July 17, 2019. According to the attorney, Nevada law only allows a time period of 10 days for such objections to be filed. Yet, Schonfeld has remarked that this 10-day opening only applies to Ivey himself and not to Cates or Trincher due to their being third-party claimants. Ivey himself, after all, is not the one making a claim of exemption.

As things stand at the moment, Schonfeld has not formally represented Ivey with regard to the Nevada garnishment. However, he did write, “Notwithstanding Counsel Klausner’s pro hac vice issues, [Borgata] may be entitled to receive $37,205 which represents Mr. Ivey’s portion of the funds…”

Yet, it’s probably not a likely outcome to believe that the Borgata will accept any sort of negotiation that will allow Cates and Trincher to receive their requested money. If that were to happen, Ivey could simply continue claiming tournament backing as a way of escaping having to pay any financial debts such as the one he owes to the Borgata.

Ivey Has Troubles but WSOP Continues

It was only in 2018 that Ivey made his return to the poker tournament scene in the United States. This came after a multi-year hiatus from such although his results in events as of late have been somewhat sub-par when compared to what he was achieving prior to his break. During the 2019 WSOP for example, he cashed in just four events with his only outstanding finish being in the Poker Players Championship.

The Rio Is the Current Home of the WSOP, but for How Much Longer?

This year marked the 50th annual WSOP tournament, which took place at the Rio All-Suite Hotel & Casino in Las Vegas. Some people have wondered about the future of the WSOP tournament, following news of the Rio Hotel & Casino being sold by Caesars Entertainment. While WSOP spokesperson Seth Palansky has confirmed that it will definitely take place at the Rio in 2020, speculation has been made over it moving to the Caesars Forum Conference Center beyond that. This year’s WSOP Main Event was won by Germany’s Hossein Ensan, who took home the grand prize of $10,000,000.

Online Play Fine Prep for World Series

Of course, it's too late to worry about this year's World Series of Poker, but there's always next year to think about. If you'd like to gear yourself up for a few deep runs in tournaments in Vegas in 2020, then it might be prudent to head online now and start practicing. After all, the volume of hands and games you can plow through online is an order of magnitude greater than if you were to sit at a live table, which is bound to feel slow by comparison.

Look at our USA online poker guide and walkthrough for accurate info on the leading sites and legalities that pertain to the pastime of internet poker.