Court: Gambler can sue SC pizza place for poker losses

jmonk@thestate.comMay 15, 2013 

Rockaway's Athletic Club on Divine Street features an Oyster Bar with all the fixins.

C. ALUKA BERRY — THE STATE

— A gambler can go ahead with a lawsuit in which she seeks to recoup nearly $700,000 in alleged losses from playing illegal video poker machines at popular Columbia eateries Pizza Man and Rockaways, the S.C. Court of Appeals ruled Wednesday.

Specifically, the Court of Appeals upheld a circuit court judge’s decision that under S.C. law, a gambler can sue the gambling establishment to recover losses.

The decision, which involves admitted compulsive gambler Lauren Proctor, still can be appealed to the S.C. Supreme Court.

But Pete Strom, one of Proctor’s lawyers, told The State newspaper on Wednesday that the Court of Appeals’ decision is a clear, landmark statement that “gives a green light” for anyone wanting to sue an illegal gambling operation to recover lost money.

“You will see a flood of lawsuits now filed against the illegal video poker and sweepstakes industry and the mom-and-pop stores that house their machines,” Strom said.

Sweepstakes gambling is a permutation of video poker that involves payoffs in chits or some other non-cash reward that can eventually be traded for cash or valuables. Video poker machines with cash payouts were outlawed in South Carolina in 2000. And legislators this year closed a loophole in the law that some argued made sweepstakes games legal.

Columbia lawyer Jim Griffin, representing the eateries’ owner, Whitlark & Whitlark Inc., declined to say whether the restaurants will appeal, saying, “The decision just came out, so we are studying it and reviewing our options.”

The Court of Appeals’ decision says allowing a gambler to sue to recover losses is beneficial to society because it conceivably serves to deter gambling by putting an illegal betting establishment on notice that it is subject to being sued.

Before Proctor’s lawsuit can go to trial, the legal issue of whether a losing gambler can sue the illegal gambling operation has to be finally settled, meaning the restaurants’ owners will have to decide whether to appeal to the Supreme Court.

Restitution

If and when Proctor’s lawsuit goes to trial, any money she recovered would be given to organizations and people she embezzled money from to finance her play at the video poker machines at Pizza Man’s and Rockaways, Strom said.

“The proceeds will go to restitution,” Strom said.

Proctor’s case stems from a tangled set of circumstances and law.

From 1999 to 2005, Proctor frequently gambled on video poker machines at Pizza Man and Rockaways Athletic Club, losing between $1,000 and $5,000 a week, according to the S.C. Court of Appeals decision. The two establishments provided her with cash advances to fund her gambling as well as free food and liquor, the decision says.

In the year 2000, when video poker machines became illegal in South Carolina, Proctor kept using the machines at the eateries and losing money.

Pizza Man and Rockaways’ staff would “provide her cash advances on her credit cards to enable her to fund her gambling,” her original lawsuit claimed.

During the time she was gambling and losing, she began to embezzle money from State Title, a company her mother owned that provided real estate closing services to attorney Walter Smith.

After the FBI learned about her embezzling, Proctor – in an effort to get a lighter sentence – agreed to help the Bureau get evidence about the video poker machines by wearing a hidden wire and video and audio surveillance equipment on her visits to Rockaways and Pizza Man. The two eateries are located near the intersection of Rosewood Drive and Woodrow Street in Columbia.

She compiled 20 hours of secret audio and video at the two eateries – evidence that was crucial in allowing the FBI to seize gambling machines and arrest Forrest Whitlark, one of the owners, according to federal records in Proctor’s case.

Proctor told investigators she was one of about 20 people allowed to keep gambling at the establishments after video poker became illegal. It’s unclear where the machines were in the businesses.

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