3 F.Supp.2d 518 (D.N.J. 1998), Civ. A. 97-4291, Doug Grant, Inc. v. Greate Bay Casino Corp.

Docket Nº:CIV. A. 97-4291, (JEI).
Citation:3 F.Supp.2d 518
Party Name:DOUG GRANT, INC., et al., Plaintiffs. v. GREATE BAY CASINO CORP., et al., Defendants.
Case Date:May 01, 1998
Court:United States District Courts, 3th Circuit, District of New Jersey
 
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3 F.Supp.2d 518 (D.N.J. 1998)

DOUG GRANT, INC., et al., Plaintiffs.

v.

GREATE BAY CASINO CORP., et al., Defendants.

No. CIV. A. 97-4291, (JEI).

United States District Court, D. New Jersey.

May 1, 1998

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Howard A. Altschuler, Haworth, NJ, for Doug Grant, Inc., et al.

Barry & McMoran by Adam N. Saravay, John J. Barry, Newark, NJ, for Trump Casino, All Other Casino Defendants, Griffin Investigations.

Levine, Staller, Sklar, Chan, Brodsky & Donnelly, P.A. by John M. Donnelly, Atlantic City, NJ, for Casino Defendants (other than Trump Casino), Griffin Investigations.

Madden, Madden & Del Duca, by Damien O. Del Duca, Patrick J. Madden, Haddonfield, NJ, for F. Michael Daily, Ellen Barney Balint, Quinne, Dunne, Daily and Higgins, P.A.

Kelley, Wardell & Craig, LLP by John T. Kelley, Haddonfield, NJ, for Meranze & Katz.

Sterns & Weinroth, P.C. by Michael L. Rosenberg, Bart Q. Hollander, Trenton, NJ, for Caplan & Luber, Lloyd S. Markind, Richard L. Caplan, Sharon Morgan, Michele Davis.

OPINION

IRENAS, District Judge.

Plaintiffs, who are primarily card-counting blackjack players, bring this action against

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thirty-eight casino defendants ("Casino Defendants"), three investigation agencies, and several hundred "John Doe" defendants, alleging a conspiracy in violation of state and federal RICO statutes, and violations of the New Jersey Public Accommodations Act and the New Jersey Consumer Fraud Act. In addition, they assert constitutional and civil rights claims implicating the Equal Protection Clause, the Due Process Clause, Article 1, paragraph 1 of the New Jersey Constitution, 42 U.S.C.§ 1983 and other state and federal statutes, and various common law claims for breach of contract, fraud, tortious interference with contract and prospective economic advantage, and negligence. The complaint also asserts an assortment of personal injury claims. including invasions of privacy, misappropriation of name or likeness, libel, slander, and infliction of emotional distress. Finally, plaintiffs assert claims against nine lawyer and law firm defendants ("Lawyer Defendants") for legal malpractice, breach of fiduciary duty, negligence, breach of contract, and negligent supervision. 1 Jurisdiction over plaintiffs' federal statutory and constitutional claims is premised upon 28 U.S.C. § 1331. Jurisdiction over plaintiffs' remaining claims is based upon the Court's supplemental jurisdiction pursuant to 28 U.S.C. § 1367.

Currently before the Court are motions by all of the defendants to dismiss the plaintiffs' complaint pursuant to Fed.R.Civ.P. 12(b) (6). The defendants are also in the process of filing a motion for Rule 11 sanctions, Fed.R.Civ.P. 11, against plaintiffs' attorney and the lead plaintiff, Doug Grant von Reiman ("Doug Grant"), who claims to act as attorney-in-fact for the plaintiffs. We will reserve all issues relating to the Rule 11 sanctions for consideration at a later date. For the reasons that follow, we will grant the defendants' motions to dismiss under Fed.R.Civ.P. 12(b) (6) as to the First Count, Second Count, Third Count, Fifth Count, Sixth Count, Seventh Count and Thirteenth Count. These counts are all based on the plaintiffs' central allegation that the casinos' implementation of Casino Control Commission ("CCC") regulations violates various federal and state statutes, the common law, and the United States and New Jersey Constitutions. After dismissing all these federal and related claims based on the CCC regulations, we decline to retain subject matter jurisdiction over the remaining state law claims alleged in the Eighth, Ninth, Tenth and Eleventh Counts and the state law malpractice claims against the Lawyer Defendants. Because these claims do not form part of the same case or controversy as the CCC regulation claims and because, in any case, we have discretion to decline to exercise supplemental jurisdiction, we will remand them to state court. As plaintiffs have withdrawn their claims under the Fourth and Eleventh Counts, we will also dismiss these claims.

I. BACKGROUND

The individual plaintiffs in this matter are blackjack players who frequent the Atlantic City casinos operated by the Casino Defendants.

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2] Most of them have developed card-counting skills which enable them to reduce or eliminate the normal odds in favor of the casinos. The corporate plaintiffs are corporations associated with plaintiff Doug Grant, Inc., a New Jersey corporation whose predecessor corporations were involved in operating card-counting schools and mock casinos set up by plaintiff and renowned card-counter Doug Grant. The complaint alleges that the schools and mock casinos were forced to close down in 1992 as the result of the Casino Defendants' alleged illegal countermeasures against card-counters and because of bomb threats, break-ins, destruction of property, theft of student lists, stalking and other intimidation tactics. Doug Grant, Inc. also provided the training for several cooperative player groups, including many plaintiffs, who pooled their financial resources and agreed to share their blackjack winnings.

A. The Play of Blackjack, Card-Counting and Shuffling-At-Will and Other Countermeasures

The gravamen of plaintiffs' complaint is that the Casino Defendants undertake certain "illegal" countermeasures to eliminate the advantage a skilled card-counter may be able to gain over the casinos in the game of blackjack. Blackjack is the one casino game in which a player's skill may increase his chance of winning to the point of eliminating the winning odds in favor of the "house." Card-counters use intellect and memory to identify when, during the course of play, the odds of winning are better or worse. A short discussion of Atlantic City blackjack and the practice of card-counting is necessary to assist the reader in better understanding the plaintiffs' allegations.

Blackjack must be played with decks containing fifty-two cards of four suits (hearts, diamonds, clubs and spades) with each suit containing thirteen cards (Ace, King, Queen, Jack, 10, 9, 8, 7, 6, 5, 4, 3, 2). N.J.A.C. 19:46-1.17. Before blackjack games are commenced, the dealer receives one or more, usually between six to eight, decks from the casino supervisor and inspects them in the presence of the floorperson. Id. 19:46-1.18(a), (f); id. 19:47-2.4(a). After the cards are inspected, the dealer takes them to his table and spreads them out in a fan, face upwards, for visual inspection by the first player or players to arrive at the table. Id. 19:47-2.4(b). After the first player or players is afforded an opportunity to visually inspect the cards, the cards are turned face downward on the table, mixed thoroughly, shuffled until "randomly intermixed," and then placed into a stack. Id. 19:47-2.4(c); id. 19:47-2.5(a). After the shuffle is completed, the dealer asks the player seated at a certain position at the table, as defined by the regulations, id. 19:47-2.5(e), to cut the deck. Id. 19:47-2.5(b). The player cuts the deck by placing a plastic cutting card in the stack at least ten cards from either end. Id. 19:47-2.5(c). Once the cutting card has been inserted by the player, the dealer takes all the cards in front of the cutting card and places them at the back of the stack. Id. 19:47-2.5(d). The dealer then takes the entire stack of cards that was just shuffled and cut and aligns it along the side of the dealing shoe which has a mark on the side that enables the dealer to insert the cutting card so that it is in a position "at least approximately" one-quarter of the way from the back of the stack. Id. 19:47-2.5(d); see id. 19:46-1.19(d) (4). The stack of cards is then inserted into the dealing shoe for commencement of play. Id. 19:47-2.5(d). The cards behind the cutting card will not be used during the game. 3 Id. 19:47-2.5(h). The dealer then deals the cards to the players in a series of blackjack hands until the dealer reaches the cutting card. Once the cutting card is reached, the dealer repeats the shuffling

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process and cutting procedures described above. Id.

In the game of blackjack, where the object of play is to reach as close to a total card value of "21" without exceeding that value, certain cards are more favorable to the player and certain cards are more favorable to the dealer. The player-favorable cards are the Ace, King, Queen, Jack and Ten. The dealer-favorable cards are the 6, 5, 4, 3, and 2. The 7, 8, and 9 are neutral. At any given point during the play of a shoe, the shoe might contain more player-favorable cards or it might contain more dealer-favorable cards. When there are more player-favorable cards, the players' chances of winning are increased. When there are more dealer-favorable cards, the dealer's chances of winning are increased. Whether and when a shoe will turn out to be player-or dealer-favorable is purely random.

Card-counters attempt to "count cards" so as to determine whether and when a shoe is player-favorable. They then vary their bets, betting high when the shoe is player-favorable and low when the shoe is dealer-favorable. Bets are placed before each individual round of blackjack and are generally based on the approved minimums and maximums for the table. According to the plaintiffs, successful card-counting contains several basic elements. These include: the assignment of a point value to each card, maintaining a running total of those points during play, betting strategies, playing strategies, money management, a sufficient bankroll, and "the intangible ability to consistently apply these interrelated strategies under fast-paced casino conditions." Compl. at ¶ 133.1.

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