HARRY Kakavas drove a hard bargain. Before hitting the baccarat tables of Crown casino, he would push for the kind of rewards high rollers expect star treatment, lucky money, and free use of a Gulf Stream jet.
At any stage during the 14 months in which he gambled almost $1.5 billion, he could have used the casino's self-exclusion program to protect himself from his pathological addiction. Instead, he used it as a threat to get a better deal from Crown, the Supreme Court has found.
Mr Kakavas yesterday lost his bid to sue the casino for about $35 million in losses and damages. He owes Crown $1 million for a bad cheque and may also have to pay the casino's court costs.
Justice David Harper ruled that the property developer "was and is a problem gambler . . . a pathological gambler".
However, his condition was irrelevant because he could match Crown in negotiating the terms on which he would play there, Justice Harper said.
"I am not satisfied that Crown did formulate a scheme to lure Mr Kakavas to commence or to continue to gamble at the casino," Justice Harper said. "Nor am I satisfied that, even if Crown had such a scheme, it would have worked.
"On the contrary, I am satisfied that, had Mr Kakavas wished to escape the enticements of the casino, he could have done so with ease. He could have arranged for self-exclusion."
Justice Harper said the law must be careful before it forces one person to nullify a free choice made by another and it should not treat gambling losses as a loss to be recovered in a court.
Casinos did not have any general duty to protect gamblers from themselves, he said.
Mr Kakavas gambled $1.479 billion between June 2005 and August 2006, betting up to $300,000 a hand and ultimately losing $20-30 million. On one occasion he lost $2.3 million in 28 minutes.
The court heard Crown flew Mr Kakavas to and from the Gold Coast on its private jet and lent it to him for trips to Asia.
But Crown did not use the jet to lure Mr Kakavas, and the fact Crown provided it showed what a good negotiator he was, Justice Harper said.
"He was no ingenue dazzled by the prosect of a ride in a Gulf Stream 5; he was someone who negotiated for a living and who knew what privileges were for VIP players in the competitive international gambling industry.
"He was capable of withholding his most powerful bargaining chip his patronage when his demands were not met."
Mr Kakavas argued Crown should repay his losses, plus damages, because it enticed him back to the casino to exploit his addiction. He had previously excluded himself from Crown and sought help through the casino. Yesterday he said he was yet to decide whether to appeal against the decision.
Justice Harper also said Crown was "seriously careless" when it allowed Mr Kakavas in in 2005, as it knew he had been banned from Sydney's Star City casino by the NSW chief commissioner of police.
This ban meant Mr Kakavas was not legally allowed into Crown and that all his winnings must be forfeited to the state. He won about $700 million in total. Justice Harper said Crown did not "forget" about the exclusion, "it simply chose to ignore it because it was in its commercial interests to have the plaintiff return to gambling at the Casino".
The casino's process for allowing a known problem gambler to return was "a pathetic excuse for world's best practice", Justice Harper said.
JUSTICE DAVID HARPER
On Harry Kakavas
He was no ingenue dazzled by the prosect of a ride in a Gulf Stream 5; he was someone who negotiated for a living and who knew what privileges were for VIP players in the competitive international gambling industry.
On Crown
Crown does present itself as a world leader in responsible gambling. Its relationship with Mr Kakavas does not give one any confi dence that it deserves that status.
On the other hand, his is one case among many. The court therefore has
no warrant to come to any general conclusions on this topic
Frequently Asked Questions about this Article…
Who is Harry Kakavas and what happened at Crown Casino?
Harry Kakavas is a high‑stakes gambler and property developer who gambled about $1.479 billion at Crown between June 2005 and August 2006. The Supreme Court found he was a pathological gambler who bet up to $300,000 a hand, ultimately losing about $20–30 million, while reports in the case also said he won around $700 million in total over time.
What did the Supreme Court rule in Kakavas' case against Crown Casino?
The Supreme Court rejected Kakavas' claim for about $35 million, finding that although he was a pathological gambler, he was capable of negotiating the terms on which he played and could have used self‑exclusion. The court also said casinos do not have a general legal duty to protect gamblers from themselves; Kakavas may owe Crown about $1 million for a bad cheque and could be liable for court costs.
Did the court find Crown Casino enticed Kakavas or deliberately targeted his gambling addiction?
No — Justice David Harper said he was not satisfied Crown had formulated a scheme to lure Kakavas back to gamble or to exploit his addiction. The judge concluded that even if Crown had such a scheme, he was not convinced it would have worked, noting Kakavas could have arranged for self‑exclusion to avoid enticements.
What role did self‑exclusion play in the Kakavas v Crown case?
The court noted Kakavas could have used Crown's self‑exclusion program to protect himself from gambling, but instead used self‑exclusion as leverage in negotiations. Justice Harper said self‑exclusion was available to him and that he could have escaped the casino's enticements with ease if he had chosen to do so.
Did Crown Casino provide special perks to Harry Kakavas, like a private jet?
Yes — the court heard Crown flew Kakavas to and from the Gold Coast on its private Gulfstream jet and lent it to him for trips to Asia. However, the judge said providing the jet did not prove Crown lured him back; it also demonstrated Kakavas' skill as a negotiator for VIP privileges.
Was Crown criticized by the court for allowing Kakavas back into the casino?
Yes — Justice Harper described Crown as 'seriously careless' for allowing Kakavas into the casino in 2005 despite a ban imposed by the NSW chief commissioner of police at Star City. The judge said Crown chose to ignore the exclusion because it was commercially beneficial, and that its process for allowing a known problem gambler to return was a 'pathetic excuse for world's best practice.'
What financial consequences did Kakavas face after losing the lawsuit?
After losing the case, Kakavas failed in his bid to recover about $35 million in losses and damages, and the court recorded he owes Crown about $1 million for a bad cheque. He may also be required to pay the casino's court costs, and he had not decided whether to appeal the decision.
What broader lessons about casino responsibility and gambling protection does the article highlight for everyday investors?
The article highlights that courts may be cautious about making casinos legally responsible for gamblers' losses and that casinos do not automatically have a general duty to protect patrons from themselves. It also underscores the availability of tools like self‑exclusion, the importance of understanding VIP perks and negotiations, and that apparent 'responsible gambling' claims by casinos may not always reflect their actions in individual cases.
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