Gamblers Accuse Casino of Reneging on Refund Promise

NEWARK, N.J. (CN) - An Atlantic City casino made millions by promising gamblers that it would refund their slot machine losses, but it never paid up, a class claims in Federal Court.

Revel Entertainment Group LLC and Chatham Asset Management LLC are the co-owners and operators of Revel Atlantic City Hotel, Resort & Casino.

After posting losses of $149 million last year, the companies aggressively promoted "Gamblers Wanted" this past summer to attract more customers and emerge from bankruptcy, according to the complaint.

"This marketing campaign was conducted during June and July 2013 through various media outlets, including advertisements on television, radio, internet and outdoor posters and billboards," the complaint states.

During July 2013, Revel allegedly promised customers that it would "refund all losses over $100 incurred at the Revel slot machines."

Various advertisements ran that stated one of the following: "If you lose we'll give it all back," "In July refund all slot losses," "In July, you can't lose" and "All July slot losses refunded," the complaint states.

Lead plaintiffs Margaret and Nicholas Peragine say the campaign was a hit, bringing consumers from all over to the Revel Casino in Atlantic City.

"Revel's gross gaming revenue increased 33%, gross table revenue increased 36% and slot machine revenue increased 32% when compared to July 2012," according to the complaint. "Upon information and belief, Revel's slot machine revenue in July 2012 was approximately $17.5 million."

The Peragines said they visited the Revel in July 2013 to "take advantage" of the defendants' promotion and both lost more than $100 on the slot machines.

When they contacted Revel to receive their refund, however, a representative allegedly told them that "they would receive slot play dollars instead of cash and that the slot play dollars had no cash value and could only be used by gambling at the Revel Casino slot machines."

The representative also told them that a flyer would be mailed to each of them further explaining the refund process, according to the complaint.

"The flyer stated that plaintiffs would receive their 'refund' in the form of free slot play dollars in the amount of 5% of the total loss incurred during July 2013," the Peragines claim. "In order to claim the free slot dollars, plaintiffs had to 'Come to Revel each week to play [their] slot refund coupon."

To receive their $100 in slot play dollars, the Peragines allegedly have to travel to the Revel for 20 straight weeks, according to the complaint. Missing a week would allegedly result in the total and permanent forfeiture of that week's slot play dollars.

"None of the 'Gamblers Wanted' campaign advertisements stated there were any restrictions or limitations on the Slot Refund Offer, other than that the Slot Refund Offer only applied to losses of greater than $100 incurred during July 2013. Some, but not all, of defendants 'Gamblers Wanted' advertisements set forth other limitations and restrictions in conflicting and virtually unreadable fine print that was displayed too quickly for consumers to read and/or displayed in a font too small to be readable," the complaint states.

While the miniscule font flashed for two seconds on television and Internet video advertisements, the online press release contained no disclaimer, restrictions or limitations, and the radio advertisements told listeners only to visit the Player's Club for details, the Peragines say.

"A reasonable customer who viewed or heard defendants' 'Gamblers Wanted' advertisements would interpret such advertisements to mean that any slot losses incurred in excess of $100 during July 2013 would be immediately refunded to the customer in either cash or a cash equivalent," the complaint states.

"Defendants' purposefully created and disseminated the 'Gamblers Wanted' advertisements that promised refund slot losses during July 2013 with the intention of never fulfilling such promises."

The class seeks punitive damages for violations of the New Jersey Consumer Fraud Act, the New Jersey Truth-In-Consumer Contract, the Warranty and Notice Act, and the New York General Business Law, as well as breach of contract, unjust enrichment and bad faith.

It is represented by Joseph Sauder with Chimicles & Tikellis, of Haverford, Pa.

Chatham Asset Management declined to comment on the pending litigation, while Revel Entertainment Group did not return a request for comment.

Subscribe to Closing Arguments

Sign up for new weekly newsletter Closing Arguments to get the latest about ongoing trials, major litigation and hot cases and rulings in courthouses around the U.S. and the world.

Email *

Submit