Taking up Caesars Riverboat Casino’s offer of a free hotel room, drinks and meals, Genevieve M. Kephart went to the casino and lost $125,000 in a single evening. Kephart did not have that kind of cash on her, so Caesar’s provided her with six counter checks that she could write on her own account. When the checks bounced, Caesars sued Kephart, seeking treble damages and attorney fees, as allowed by Indiana law. Kephart countersued, alleging that Caesars knew she is a pathological gambler and took advantage of her to enrich itself. Now, the Indiana Supreme Court will decide whether Kephart can pursue her counterclaim.
The Harrison County Circuit Court allowed Kephart’s claim to proceed, but that decision was reversed by the Indiana Court of Appeal. Assuming Kephart’s claims to be true and finding Caesar’s alleged actions to be “extremely concerning” the Court still concluded that “Kephart has a responsibility to protect herself from her own proclivities and not rely on a casino to bear sole responsibility for her actions.” Caesars v. Kephart, 903 N.E.2d 117, 127 (Ind.Ct.App. 2009). The court also commented, “For gamblers, compulsive or otherwise, just as for shoppers, compulsive or otherwise, marketing by a vendor is not reckless conduct.” Id. at 125.
In dissent, Judge Crone wrote, “Caesars was aware of Kephart’s gambling addiction, lured her into its casino with complimentary transportation, lodging, food, and drinks, let her gamble away $ 125,000 in borrowed funds without investigating her creditworthiness, and then sought to triple its take by suing her for treble damages plus attorney’s fees. I would conclude that the unsavory circumstances surrounding this relationship support the imposition of a duty in this case.”
In granting transfer, the Indiana Supreme Court automatically vacated the appellate court’s decision and will itself decide whether Kephart’s claim can proceed. Oral arguments were heard on November 14, 2009.