Juris Doctor Candidate, 2016
Valparaiso University Law
Gambling losers Casey Sonnenberg and Daniel Fahrner, continued their losing streak after the Seventh Circuit ruled they could not recoup their gambling losses from online gambling websites in Fahrner v. Tiltware, LLC. The two Illinois men each lost at least $50 on various online gambling sites including one operated by the defendant, Tiltware, LLC.
Gambling is a crime under Illinois law, but the state allows gamblers to recover their losses in a civil suit against the winner under the Illinois Loss Recovery Act (ILRA). The statute of limitations under the act is six months, but if parties do not file a timely lawsuit, third parties may bring a claim on their behalf. In this case, the mothers of the two men sued the website operator after Sonnenberg and Fahrner failed to sue within the statute of limitations period.
The trial court originally dismissed the suit in 2015, after the plaintiffs failed to specify exactly how much money was lost and who the winner of the money was. Naming the website operator as the winner proved to be an unsuccessful argument with the Seventh Circuit, as the court reasoned that operating the site and taking some of the money as a website maintenance fee was not enough for the defendant to be classified as a winner. The Court opined, “A winner would be a person whom a player had played with and lost to.”
The plaintiffs also attempted to convince the court to build a civil cause of action into the criminal statute that would targets operators of illegal gambling sites. However, the Seventh Circuit noted that the full range of criminal penalties available under the law suggested legislators likely did not intend for that type of action to exist. In addition, the court discussed the disastrous legal and economic consequences the civil remedy could have on the gambling industry by inviting a flood of lawsuits from gamblers.
According to the court, creating legal remedies for gambling losses is not a proper deterrent against gambling because gamblers are aware of the risk of losing at the outset. Judge Posner, the author of the opinion, made sure to wrap up his analysis in true Posner fashion by ending with an facetious quote in reference to gambling losers, “I’d rather have won, but $50 wasn’t too high a price to pay for a night of gambling, and en route to losing $50 I did after all win some nice pots and get compliments from the guys I was playing with.”
Several cases arising under the ILRA have been dismissed, partially for failing to name a specific winner or loser, as in Langone v. FanDuel, a case involving a fantasy sports website. Other states also have similar versions of the Loss Recovery Act. Although Sonnenberg and Fahrner cannot seem to win in or outside the courtroom, this case is certainly a win for the gambling industry. The Seventh Circuit’s ruling effectively insulates gambling website owners and operators from liability under the ILRA, further protecting the industry from being sued into oblivion. It may also be precedent for the growing strain of fantasy sports ILRA cases in the jurisdiction, and influential case law in other states with Loss Recovery Acts.