Clark County’s Eighth Judicial Court ruled for a partial dismissal in the ongoing court battle between high-stakes grinder Matthew Kirk and the owner of King’s Casino, Leon Tsoukernik. The lawsuit, filed by Kirk, seeks to recover $2,000,000 of an alleged $3,000,000 loan Kirk gave to Tsoukernik during a heads-up battle at the Aria Hotel & Casino this spring just prior to the World Series of Poker in Las Vegas.
According to court documents obtained by PocketFives.com, on the morning of May 27 2017, Kirk and Tsoukernik were engaged in a high-stakes heads-up poker game that seemingly was going Kirk’s way. So much so that on four occasions during that session, Kirk “loaned casino chips to Mr. Tsoukernik so that Mr. Tsoukernik could continue playing the heads-up poker game against Mr. Kirk.” In total, Kirk handed over $3,000,000 in chips to Tsoukernik. At the conclusion of the match, Tsourkernik seemingly refused to pay the amount back and only after “repeated demands” handed over $1,000,000 on June 3 to Kirk. Looking to obtain the remaining $2,000,000 debt, Kirk filed a lawsuit in the state of Nevada will allegations of “breach of contract, breach of implied covenant of good faith and fair dealing, fraudulent inducement, and unjust enrichment.”
Partial Dismissal & Nevada Revised Statue 463.361(1)
Tsourkernik’s legal team looked to have the entire lawsuit dismissed, mainly, on the back of Nevada Revised Statue 463.361(1). The basic breakdown of NRS 463.361(1) is that the state does not enforce gaming debts between non-licensed parties. For licensed parties (e.g. major casinos) there are legal remedies should someone opt not to pay back a gaming debt. But for two unlicensed participants like Kirk and Tsoukernik, their early morning heads-up battle and subsequent loaning of chips is classified by the state as a gaming debt as there was money won and lost. That gaming debt, and therefore the “contract” between them, is not legally enforceable.
In response to the motion, Kirk claimed that the loaning of the physical chips was not, in and of itself, the gaming debt and therefore needed to be repaid. The court determined that, no matter the currency, it didn’t change the nature of the debt. The court therefore dismissed Kirk’s claims of “breach of contract” and “breach of implied covenant of good faith and fair dealing.”
Tsoukernik Not Off The Hook
Even though Tsourkernik had counts 1-8 dismissed and had the debt declared a nonenforceable gaming debt, the court found the Kirk had enough to proceed with the lawsuit on the final two allegations of “fraudulent inducement and unjust enrichment.”
Fraudulent inducement is, essentially, the entering of an agreement by one party with no actual intent on holding up their end of the bargain. While the Court has deemed that it would not enforce an illegal or unenforceable contract, such as the gaming debt here, that it is not without exception. In this case, there was no illegality, no “serious moral turpitude” and Kirk’s allegation that Tsourkernik had no intention of paying him back from the very start is at the very least viable, citing text messages from Tsourkernik to Kirk allegedly sent less than 20 minutes after the match, where Tsourkernik acknowledges that he took the money but stating that the debt is invalid.
Here’s a look at what constitutes “Fraudulent Inducement”, according to the court document:
“First, a false representation; second, knowledge that the representation is false; third, an intent to induce consent to contract; fourth, justifiable reliance on the misrepresentation; and fifth, damages resulting from such a reliance.”
Basically, Kirk is claiming that Tsourkernik represented that he would pay him back and took the money with no intention to do so because he thought that recovering the debt would be completely unenforceable.
Finally, Kirk’s claim of “unjust enrichment” was also survived. If “fraudulent inducement” is proven, then it stands that it could be found that Tsourkernik also had “greatest moral fault” in the incident and therefore, by not paying back $2,000,000 of the debt, has been unjustly enriched.
The first eight counts relating to the breach of contract claims have been dismissed. The Court views the agreement as an unenforceable gaming debt between the two parties. That said, if Tsourkernik was banking on that when he entered the gaming debt, Kirk still has remedies available to him and therefore the final two counts of fraudulent inducement and unjust enrichment can proceed.
Matthew ‘Aussie Matt’ Kirk, is still playing in the Las Vegas high-roller scene having appeared on the reboot of Poker After Dark in August while Tsourkernik, as the owner of King’s Casino, is preparing to host the World Series of Poker Europe in Rozadov, Czech Republic starting on October 19. The two have even played against each other on partypoker’s high stakes cash games.