Legal status of poker: Is it a game of skill or chance?
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Millions of Americans play poker, wanting to believe that their keen math skills and shrewd assessment of opponents should enable them to win $50 from friends, $500 in a casino or $5,000 in a big tournament.
Of course, the cards have their own way of determining winners and losers. A dolt who should have folded his hand long ago but gets a lucky card can become rich at the expense of someone who rightfully earned the nickname "Ace" years earlier.
The question of whether poker is a game of skill or chance, and what that has to do with its legality, is being debated anew in courtrooms in Pennsylvania and elsewhere. The rise of popular Texas Hold 'em games emulating televised card competition has brought up questions that were unanticipated by those writing laws to cover gambling decades ago.
In Pennsylvania's Columbia County Jan. 14, a judge agreed with a defense attorney's arguments and dismissed charges against two people who ran a poker game out of a garage. It may have been gambling but not unlawfully so, because the outcome of the games had more to do with skill than chance, Judge Thomas James Jr. ruled.
In Westmoreland County, a defense attorney expects to make the same argument in a trial this spring of three individuals who organized Texas Hold 'em tournaments at fire halls.
Other cases have arisen recently in South Carolina and Colorado, with similar questions of whether and where a line is crossed when people play cards for money outside of a legal casino.
"If you did a survey of the 67 district attorneys in Pennsylvania, you would probably get 67 different opinions on what constitutes illegal gambling in terms of poker," said Kevin Harley, spokesman for the Pennsylvania attorney general's office.
He and others noted that it's possible to interpret the state's murky law so strictly to find it illegal merely to play poker, while some may hold that the only criminal action is to take a share of money for running games, and Judge James seems to protect the right even to do that.
It's commonly agreed that there are numerous opportunities to play Texas Hold 'em around Pennsylvania, often to benefit nonprofit organizations. Law enforcement officials usually look the other way, although the liquor code puts licensed establishments under more restrictions than other places.
Otherwise, the potential for police action is strongest when organized crime involvement is suspected, complaints about gambling are received or someone is making a personal profit from running the games.
In Columbia County, state police went after Diane Dent and Walter Watkins for a regular weekend game they held in a garage, sometimes recruiting players at a bar. They would make money from tips customarily provided by players who win a pot -- a voluntary but standard practice as well in commercial casinos.
In a 15-page opinion explaining his dismissal of the charges, Judge James analyzed both the history of interpretation of Pennsylvania gambling law and the factors involved in winning at poker.
While "unlawful gambling" is banned in the state, the Legislature never defined it. The judge noted case law in Pennsylvania, as in many states, came to find three common elements that must be involved in gambling: "consideration, chance and reward."
The key word there is "chance," meaning luck. If it's a random game like the state lottery or casino roulette, that would constitute gambling subject to prosecution, but Judge James wrote, "If skill predominates, it is not gambling." He then cited researchers of poker, authors of books on it and law review analyses relating to it.
Ultimately finding for the defense, he concluded: "Successful players must possess intellectual and psychological skills. They must know the rules and the mathematical odds. They must know how to read their opponents' 'tells' and styles. They must know when to hold and fold and raise. They must know how to manage their money."
The defense attorney, Peter Campana, who learned poker as a University of Pittsburgh student 40 years ago, said he's aware that the judge plays the game occasionally. He also noted that prosecutors never offered any expert opinion that poker is based more on luck.
"As it stands now, there's nothing illegal about it," Mr. Campana said.
The Columbia County judge's decision has no effect on courts elsewhere in the state, but county District Attorney Gary Norton has appealed it to Superior Court. A ruling there could have widespread impact.
"We respectfully disagree that [skill vs. chance] should be the focus of the question," Mr. Norton said. "In this particular case, the house was accepting what they call tips. ... In my mind, that's the equivalent of a casino."
The only casinos operating legally in Pennsylvania are ones that paid the state $50 million for the right to open, and hope someday to have poker rooms themselves.
"Let's face it, the state is looking at how do they capture the money," said Tripp Amick, of Scott, Pennsylvania director for the national Poker Players Alliance.
But he also acknowledged there are few other cases across the state of police intervening in the ubiquitous poker tourneys. There seem to be fewer such games locally than in the past, he said, perhaps from fear of crackdowns but also because West Virginia casinos in Wheeling and Chester opened poker rooms allowing legal play 15 months ago.
David Millstein, the lawyer for Larry Burns, who is accused of coordinating the fire hall tournaments in the Westmoreland case, said he believes state police and prosecutors have filed charges in a few instances to make test cases that discourage other games. Though his client was profiting from organizing poker games for nonprofit groups, there's nothing in state law that prohibits it, Mr. Millstein maintains.
Judge Richard McCormick rejected the attorney's pre-trial argument that the state's gambling law was too vague for the charges to have merit. The judge found Jan. 30 that "an ordinary man of common intelligence" would realize that poker playing is an "activity for which they would be criminally accountable." Mr. Millstein still hopes to raise the skill-vs.-chance argument when the case comes to trial, possibly in April.
"There is no statutory definition of gambling in the commonwealth of Pennsylvania, and no statute or case law which has held that poker is illegal gambling," Mr. Millstein said. "If the commonwealth wants to [prohibit] this, all they have to do is pass a law saying playing cards for money is against the law, and they haven't."
There's nothing clear nationally in poker cases. In a recent South Carolina case, a judge also determined that poker is a game of skill, but he said the state's 1802 law still led him to convict individuals charged there for running a gambling house.
University of Denver statistics Professor Robert Hannum testified for the defense in that trial, and some of his research was cited by Columbia County's Judge James in his opinion. The professor said it's unquestioned that poker is primarily a game of skill, which will be evident through any reasonable length of play.
"The player employing strategy will beat the unskillful player convincingly, and you can show that mathematically and with simulations," he said
It is a theory that has achieved such popularity that Harvard University law Professor Charles Nesson founded the Global Poker Strategic Thinking Society to promote the game's use among aspiring lawyers and other academics to challenge their brains and skills. People can play poker legally in most states other than Pennsylvania now by visiting casinos or card rooms, but Dr. Nesson doesn't believe in restrictions anywhere.
"It is positive public policy to teach your people skills, and poker happens to be the most fundamental, strategic skill," he said. "To me, it's a brilliant American invention. ... The idea that we should prevent people from learning skill, but encourage them to love chance with the state lotteries, is the reverse of sensible educational policy."
Of the Columbia County ruling, the professor cried: "Hallelujah!"
That level of enthusiasm for the game's legality is to be determined soon in a Westmoreland County courtroom and beyond that by the state Superior Court. One thing worth betting on -- a lot of games will be going on regardless of those decisions.
First Published March 1, 2009 12:00 am