Don't count on Arizona courts to help you recover money you lost with online gambling.
The state Court of Appeals on Thursday rejected a bid by Jerry Hannosh to sue the operators of an off-shore Internet gaming site for the $800,000 he lost. Judge Maurice Portley, writing for the unanimous court, said the state racketeering laws that Hannosh said should protect him from illegal activity do not apply.
At the very least, Portley said gambling losses do not constitute the kind of “injury” covered by state racketeering laws, which allow those who have been harmed to recover. But the judge said it's even more basic than that.
“Hannosh got what he bargained for: an opportunity to win,” Portley wrote.
He said Hannosh was aware of the terms, including the fact that the web site would keep 10 percent of any winnings, and Portley said Hannosh did not allege that the odds were manipulated or the gaming was rigged.
“Voluntary Internet gambling is a gamble — pick the right team or the spread on the game, you win and make money; pick the wrong team or the spread on the game, you lose and owe money,” the judge wrote.
Hannosh is basing his claim on Arizona's version of the Organized Crime, Fraud and Terrorism Act, also known as the state's RICO statute. It covers any act where the penalty is more than a year in prison. And it specifically includes illegal gambling.
It also says anyone who sustains “reasonably foreseeable injury to his person, business or property” due to illegal racketeering can seek to recover damages in superior court.
But Portley said he and his colleagues are unwilling to accept Hannosh's argument that “injury” includes losses from an alleged illegal gambling operation.
“Gambling losses would not qualify as an injury to person because gambling without a chance to lose is not a legally protected interest,” the judge wrote. “Because Hannosh voluntarily took the understood risk that he could win and that he could lose, his losses cannot be considered an 'injury to person' recoverable through an Arizona RICO lawsuit.”