SUIT OF THE WEEK: GAMBLER LOSES THE BIG ONE-A RICO LAWSUIT.

A compulsive gambler cannot sue the casino that took his money under the Racketeer Influenced and Corrupt Organizations Act, the Seventh U.S. Circuit Court of Appeals ruled Dec. 5.

"Because we find his RICO claims to be frivolous and alleged solely to invoke the jurisdiction of the federal courts, we vacate the district court's judgment and dismiss his lawsuit for want of subject-matter jurisdiction," Judge Ann Claire Williams wrote for the three-judge panel in David M. Williams v. Aztar Indiana Gaming Co. d/b/a Casino Aztar (03-1822).

Williams had already lost in the lower court, although not as badly; it had granted summary judgment to the casino instead of throwing out the lawsuit altogether.

David Williams, a former auditor with the Indiana Department of Revenue, began gambling in 1996 at Casino Aztar, a riverboat casino on the Ohio River in Evansville, IN.

When his gambling habits appeared to get out of control, his girlfriend persuaded Aztar's Responsible Gaming Committee to talk to him. He checked into a mental health facility, and Aztar sent him a "Cease Admissions" letter in 1998 saying he couldn't come back without "medical /psychological information" showing his patronage "poses no threat to your safety and/or well-being."

Between the time his girlfriend contacted Aztar and the mailing of the letter, he had lost another $160,000.

In 1999, however, he returned to the casino, was admitted and gambled away another $15,000 to $20,000 before he was barred. Meanwhile, the casino was mailing him promotional materials.

Although Indiana law allows individuals to add themselves to a casino's eviction list, he never invoked it.

David Williams sued, filing a number of state-law claims and alleging a RICO violation. He cited the "Cease Admissions" letter and subsequent promotional mailings as "predicate acts" of mail fraud.

The Seventh Circuit said that claim was frivolous, so federal courts had no business hearing the case.

"The viability of Williams's RICO claim turns on whether he has established a pattern of racketeering activity, which is an essential element of a claim under the RICO statute," Judge Williams wrote.

The "Cease Admissions" letter "in no way constitutes a misrepresentation, much less one on which Williams could rely," he said.

"As for the promotional mailings, even if the statements in these communications could be considered 'false' or 'misrepresentations,' it is clear they are nothing more than sales puffery on which no person of ordinary prudence and comprehension could rely."

To top if off, the appellate panel found not only that the initial RICO claim was frivolous but that the appeal was frivolous, and gave the gambler 14 days to show cause why he shouldn't face sanctions.