With the filing of a new lawsuit Monday, California courts are once again examining the enforceability of credit card debts accrued through online gambling. Marin vs. American Express, filed in the Marino County California Superior Court, alleges that during the summer of 1998, California resident Fred Marino surfed his way to more than $25,000 in online gambling debts.
American Express and Discover have sought repayment. Marino and his attorney, Ira Rothken (the same attorney who represented Cynthia Haines in her successful battle against Visa and MasterCard), claim that debt is not legally enforceable. According to Rothken, American Express allegedly threatened to sue Marino and ruin his credit history if he didn't pay up more than $19,000 in gambling debts. The balance of debt (at least $6,000) was charged to Marino's Discover Card.
Marino ran up his debts playing at GrandCasino, CasinoOnNet, SuperCasino and Paradise Beach Club & Casino (which Rothken says is now defunct). Rothken says the case isn't against online gambling, but consumer protection--the same stance he took with the Haines case. "We're concerned that illegal loans not be given," he said.
"American Express and Discover are intimately involved in branding Internet gambling loans, making money off such loans, and harming your credit report if you do not pay them back--on loans which are illegal in California in the first place--we believe that this constitutes an unfair business practice and we are asking the court to stop it," Rothken explained.
Marino is requesting an injunction against American Express and Discover stopping the two companies from extending credit for Internet gambling to California residents.
American express, according to Vice President of Public Affairs Gail Wasserman, has not yet received the lawsuit, thus the company hasn't issued a formal response. Wasserman did, however, say that American Express no longer allows their credit card to be used for gambling debts. She believed that Marino's use of his Amex card predated this policy.
Discover Card declined to comment on the lawsuit.
Rothken is no stranger to this type of lawsuit. His client, Cynthia Haines, another California resident, ran up more than $70,000 in gambling debts with Visa and MasterCard. When the companies pressed her for payment, she responded with a lawsuit that was finally settled a few weeks ago. In the end, the credit card companies caved in and forgave her debts. As a result, the operators of the online gaming sites where she played had to eat her gambling debts and cover her legal fees.
Meanwhile, Rothken told IGN that First Union Visa, one of the defendants in Haines' original cross complaint, has recently introduced a policy banning the use of Visa for Internet. Providian National Bank, the entity that originally sued Haines, instituted a similar policy in October.
Click here to view a copy of "Marino vs. American Express" in PDF format.
Update (3/6/00): The credit card companies have had this case brought to federal court in the United States Northern District of New York. Marino's attorney, Ira Rothken, has filed a motion to have the case remanded to a state court. A hearing will be held March 28, 2000.
is the senior staff writer at IGamingNews. She lives in St. Louis, Mo.