By Yoon Tae Sung
The controversy of whether poker consists of skill more than chance was examined by the United States District Court for the Eastern District of New York. The court came to its conclusion by mainly comparing poker to sports betting/sports games. Senior United States District Judge Jack Weinstein reversed the jury conviction on August 21, 2012 that operating “Texas Hold’em” poker games by the defendant, Lawrence Dicristina, should not be thought of as a violation of the Illegal Gambling Business Act (IGBA). The reason is that skill predominates over chance in poker unlike other types of games including sports betting in which chance is more involved than skill although the defendant had been arrested due to running “a poker club in the back room of a warehouse” (p. 53) on a regular basis. The following is a summary of the judge’s order and a discussion of the case’s impact on the legality of sports betting.
The biggest issue in the judge’s conclusion was whether or not a player’s skill generally plays an important role in poker compared to the player’s luck since the IGBA has not specified poker as gambling and general lexical meaning of gambling is a game of chance for money. Dr. Randall Heeb, the expert for the defendant’s side, contended that poker could not be thought of as gambling under the IGBA, providing a few examples. He particularly opined that poker players could influence the outcome of poker games based on their skills regardless of what cards they have whereas other types of gambling such as sports betting or roulette could be more affected by chance. According to Dr. Heeb’s testimony, he affirmed that the outcome of poker games is affected by a player’s skill, which could be psychological or strategic skill, rather than by chance although he admitted chance is also slightly involved in poker games. Using a huge data set, he verified that there was an increasing probability of skilled players winning in poker games as the number of hands increased.
However, the government’s expert, Dr. David Derosa, refuted Dr. Heeb’s assertion: unlike baseball, which has nine innings that two teams have to play in a game, poker does not have a fixed period that has to be played by poker players. In other words, players can leave poker games whenever they want. Thus Dr. Derosa maintained that a single game had to form the base of Dr. Heeb’s testimony. This is because it is possible that an unskilled player could win money and be the winner of a single game against a skilled player, as chance (in favor of the unskilled player) could outweigh the skill of the skilled player, resulting in a positive return. Dr. Heeb nevertheless justified his reasoning for testing a large amount of hands in poker by providing baseball as an example. That is, baseball is “a skillful event” (p. 42), but we would be able to say that it consists of skill when testing a number of pitches by a pitcher.
Dr. Heeb also stressed that “when players are dealt the same hand, the more skilled player plays it much better and achieves a better result” (p. 25) regardless of the existence of chance in a single poker game. In other words, skilled players should be able to make unskilled players fold their hands even in a single game. He additionally provided other sports games as examples to disagree with Dr. Derosa’s contention that many skilled poker players lose their money regardless of their level of skill. In particular, Dr. Heeb maintained that, in sport, although they might be skilled, many athletes do not always win their tournaments. Sporting events do not allow many winners as “in Olympic sports, all of the athletes are highly skilled, but only three competitors per event win a prize” (p. 117). In golf, only a few players can earn the huge amount of prize monies even if there are many other skilled players. In the same vein, only a few poker players can be winners in spite of the presence of many skilled players.
Moreover, golfers need to have a level of high skill to win games, but chance sometimes plays an important role in their games as weather and field conditions can affect their performance. Nevertheless, there is no controversy regarding the contention that golf is a game of skill. In the same vein, poker players can win money due to luck, so skilled poker players would lose against unskilled players. However, like golf, players’ skill in poker could be the sole determinant of the outcome of each hand, regardless of the existence of chance, thus they overcome “the power of chance and win” (p. 113) the hand. Accordingly, Dr. Heeb opined that Dr. Derosa’s opinion could not be supported and did not adequately demonstrate his assertion that chance outweighs skill in poker.
Another interesting statement in the judgment, which opposed the government’s argument that poker is predominated by chance, was a comparison between poker and sports betting. The government consistently asserted that some level of skill is involved in sports betting since bettors can pick or predict a winner of a sporting event or game outcome based on their knowledge, but sports betting is illegal under the IGBA. Thus the government alleged that chance or skill should not be a criterion that determines whether or not poker can be construed as gambling. However, according to the judgment, there is a big difference between sports betting and poker. That is, “while a gambler with an encyclopedic knowledge of sports may perform better than others when wagering on the outcome of sporting events, unlike in poker, his skill does not influence game play” (p. 111). Accordingly, sports bettors would not be able to make themselves win the games although they are “better able to pick a winning team” (p.111). Whether or not sports bettors win the bet is decided by other factors than themselves. On the contrary, poker players can increase their chance of winning in poker games depending on their skills. This means that they “can use their skills to win even if chance has not dealt them the better hand” (p. 111) and in turn make their opponents fold their hands.
Consequently, poker players could control the outcome of poker games based on their skills while the outcome of sports betting cannot be controlled by bettors’ skills but relies on chance, as the IGBA includes sports betting in its definition of gambling. Therefore, Dr. Heeb argued that poker needs to be distinguished from sports betting or other types of gambling. The judge ultimately concluded that evidence that the defendant had run illegal gambling business was insufficient because poker is predominated by skill rather than by chance, distinguishing from other types of games enumerated by the IGBA.
Yoon Tae Sung is a doctoral student at Florida State University. He earned his master’s degree from University of Illinois at Urbana-Champaign. © Yoon Tae Sung 2012.
