Kelly v. First Astri Corp.

Page 810

84 Cal.Rptr.2d 810

72 Cal.App.4th 462, 99 Cal. Daily Op. Serv. 3696,

1999 Daily Journal D.A.R. 4706

David M. KELLY et al., Plaintiffs and Appellants, v. FIRST ASTRI CORPORATION et al., Defendants and Respondents.

No. D028362.

Court of Appeal, Fourth District, Division 1, California.

May 19, 1999.

Review Denied Sept. 1, 1999.

Joel L. Incorvaia and Anna M. Mueller, San Diego, for Plaintiffs and Appellants.

Marianne S. Johnson and Anton N. Handal, San Diego, for Defendants and Respondents.

NARES, Acting P.J.

Plaintiffs David M. Kelly, David R. Smith, and Dominick Spinale (collectively Kelly) appeal from a summary judgment in favor of defendants First Astri Corporation, Stanley Dru, and Ricci La Brake (collectively respondents) on Kelly's fourth amended complaint for recovery of gambling losses at the Sycuan Gaming Center (the Sycuan Casino) located on the Sycuan Indian Reservation. Kelly, while providing the "bank" for card games of "twenty-one" (hereafter referred to as either twenty-one or blackjack ¹), allegedly suffered gambling losses in the approximate sum of $120,000 when respondents, as managers and employees of the Sycuan Casino, intentionally or negligently allowed the placement of "marked" cards in the decks used by certain blackjack dealers, thereby giving cardplayers participating in the alleged cheating scheme a substantial winning advantage over the dealer in each game in which the "marked" cards were used. PENAL CODE SECTION 330² proscribes (among other things) the playing, carrying on, or conducting for money of games of twenty-one and "any banking ... game played with cards...."

The principal issue presented is whether on the undisputed material facts of this case, and in the absence of a statutory right to recover his alleged gambling losses, Kelly's action is barred as a matter of California law and public policy.

We conclude that Kelly's action is barred, absent a statutory right to recover his alleged gambling losses, under California's strong and long-standing public policy against judicial resolution of civil claims arising out of lawful or unlawful gambling contracts or transactions that applies both to actions for recovery of gambling losses and actions to enforce gambling debts, regardless of whether the form of blackjack, Sycuan 21, in which he participated at the Sycuan Casino on Indian lands is lawful in California, or lawful on Indian lands under federal Indian gaming law. ³

We also conclude that Sycuan 21 is proscribed by section 330, even if the playing of that game at the Sycuan Casino were lawful under federal Indian gaming law, and thus Kelly's claims are barred as a matter of California law and public policy on the additional ground the parties were in pari delicto ⁴ during their participation in the allegedly "rigged" games of Sycuan 21. We further conclude that Kelly's claims are barred under California's in pari delicto doctrine for the additional reason that, under federal Indian gaming law, Sycuan 21 is a form of Class III gaming that is illegal on California Indian lands because it is illegal in California. Accordingly, we affirm the judgment.

FACTUAL BACKGROUND

The material facts on which the court granted summary judgment in favor of respondents are undisputed.

A. The Parties and Kelly's "Banking" of Blackjack

The Sycuan Casino is located on the Sycuan Indian Reservation near the City of San Diego, and is owned by the Sycuan Band of Mission Indians (Sycuan Band). ⁵ Defendant and respondent First Astri Corporation (Astri), an Illinois corporation, entered into a card room managing agreement with the Sycuan Band under which Astri, as the managing agent of the Sycuan Casino, assumed responsibility for its day-to-day operation. Defendant and respondent Stanley Dru, a resident of Arizona, was the sole shareholder and chairman of Astri. Defendant and respondent Ricci La Brake, a Sycuan Band tribal member employed by Astri, was the general manager of the Sycuan Casino. Defendant Ollie Norton (Norton), the card room manager employed by the Sycuan Band, was responsible for the day-to-day operations of the high stakes blackjack pit area of the Sycuan Casino, including all card control procedures and all card room rules regarding the "banking" of games of blackjack.

Beginning in late 1993 and continuing through the middle of 1994, Kelly pooled financial resources and "banked" games of twenty-one at the Sycuan Casino by financially backing the dealer. In exchange for paying all of the dealer's losses to the players of twenty-one, Kelly received all of the dealer's winnings. Astri and the Sycuan Casino profited from the playing of twenty-one by charging each "banker" a fee of 50 cents per hand.

B. Kelly's Alleged "Marked" Cards Gambling Losses

In May 1994, while acting as "banker" during two games of twenty-one played against two named defendants (not parties to this appeal) at the Sycuan Casino, Kelly allegedly suffered combined gambling losses in the total approximate sum of $120,000. Based on the playing style of the player in the second game, Kelly concluded the player was able to read the "top" (or next) card the dealer dealt out of the card shoe, and thereby gain an advantage that led to Kelly's gambling losses.

Kelly continued to "bank" card games at the Sycuan Casino in order to determine whether "marked" cards were being used, and by June 1994 he became convinced cheating with "marked" cards was occurring there. Kelly further claimed he discerned darkened lines down the vertical sides on the 9, 10, and "10-value" cards, and that these markings were visible to the players when the top card was dealt from the shoe. Norton, the card room manager, testified at his deposition that in 1993 some of the cards were marked with a little red triangle in the middle of each such card, and these markings were visible to the players as the cards were dealt out of the shoe.

The alleged "marked" card cheating at the Sycuan Casino became public after an investigation when the Sycuan Band terminated the employment of a number of card room dealers, pit bosses and other employees, including Norton, the card room manager.

PROCEDURAL BACKGROUND

A. Kelly's Fourth Amended Complaint and Respondents' Answer

In his operative fourth amended complaint for recovery of gambling losses, Kelly alleged causes of action for intentional misrepresentation and fraudulent concealment, conversion, money had and received, negligence, negligent supervision, and civil conspiracy. The amended complaint alleged that Kelly and other plaintiffs not parties to this appeal suffered gambling losses in the total approximate sum of $200,000 ⁶ while "banking" the "rigged" games of twenty-one at the Sycuan Casino, plus the loss of gambling profits they "should have obtained" by "banking" the card dealers, when respondents, as managers and employees of the Sycuan Casino, intentionally or negligently allowed the placement of "marked" cards in the decks used by certain blackjack dealers, thereby giving two named card players participating in the alleged cheating scheme a substantial winning advantage over the dealer in each game in which the "marked" cards were used.

Respondents' answer to the amended complaint denied all of Kelly's allegations, and asserted in the twelfth affirmative defense that Kelly's action was barred and unenforceable under section 330.

B. Summary Judgment in Favor of Respondents

In December 1996, respondents filed a motion for summary judgment or, alternatively, for summary adjudication. Respondents argued (among other things) that Kelly's entire action was barred on the grounds the undisputed material facts established that Kelly had participated in illegal blackjack games prohibited in California under section 330, Kelly was in pari delicto with respondents by participating in those games, and Kelly's claims were thus barred by California public policy. Following oral argument, the court issued an order confirming its telephonic ruling granting respondents' summary judgment motion on the grounds the "sister state" ⁷ causes of action alleged in Kelly's amended complaint were barred and unenforceable under California public policy as a matter of law.

On March 3, 1997, the court entered judgment in favor of respondents. Kelly's timely appeal followed.

STANDARD OF REVIEW

In evaluating the propriety of a grant of summary judgment our review is de novo, and we independently review the record before the trial court. (Branco v. Kearny Moto Park, Inc. (1995) 37 Cal.App.4th 184, 189, 43 Cal.Rptr.2d 392 (Branco ).) In practical effect, we assume the role of a trial court and apply the same rules and standards that govern a trial court's determination of a motion for summary judgment. (Lopez v. University Partners (1997) 54 Cal.App.4th 1117, 1121-1122, 63 Cal.Rptr.2d 359.)

Under Code of Civil Procedure section 437c, ⁸ subdivision (c), a motion for summary judgment "shall be granted if all the papers submitted show that there is no triable issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." Because the granting of a summary judgment motion involves pure questions of law, we are required to reassess the legal significance and effect of the papers presented by the parties in connection with the motion. (Ranchwood Communities Limited Partnership v. Jim Beat Construction Co. (1996) 49 Cal.App.4th 1397, 1408, 57 Cal.Rptr.2d 386 (Ranchwood ).)

We apply the same three-step analysis required of the trial court in ruling on a motion for summary judgment. (Ranchwood, supra, 49 Cal.App.4th at p. 1408, 57 Cal.Rptr.2d 386.) First, we identify the issues framed by the pleadings because the court's sole function on a motion for summary judgment is to determine from the submitted evidence whether there is a "triable issue as to any material fact." (§ 437c, subd. (c).) To be "material" for purposes of a summary judgment proceeding, a fact...