In 2012, Phil Ivey became the talk of the gambling world after winning a fortune through a little-known technique called edge sorting.
Ivey and his accomplice, Cheung Yin “Kelly” Sun, edge sorted to beat Crockfords (London) and the Borgata (Atlantic City) out of a combined $21 million.
The ensuing legal saga graced the headlines of many mainstream news outlets in the mid-2010s. Sun and Ivey eventually lost lawsuits to both Crockfords and the Borgata. The latter is now in the process of paying off the enormous sum.
Of course, plenty of years have passed since these events happened. However, Harvard has further immortalized the story in their Journal of Sports and Entertainment Law.
It’s not every day that Harvard publishes a case study involving a gambling story. With that said, I’ll rehash this famed tale and why one of the world’s most prestigious universities decided to cover it.
Kelly Sun Masters Edge Sorting
Born to a wealthy family in Hong Kong, Kelly Sun initially started on the path towards becoming a fashion designer. Somewhere along the way, though, the path of professional gambling drew her away from the fashion industry.
Sun became a very proficient gambler who mastered various advantage play methods. She made a good living through gambling.
However, Sun eventually got sent to jail after loaning a friend $100,000 in casino credit. The friend lost big at the MGM Grand Las Vegas and didn’t cover the marker, leaving Kelly on the hook.
Sun was arrested the next time that she flew into the US. After spending weeks in jail, she set out to find the ultimate way of crushing the very casino corporations that put her behind bars.
Over the next few years, Sun became an edge sorting master as it relates to punto banco (baccarat variation). She routinely studied card backs to find pattern flaws that could distinguish one card value from the next.
Edge sorting definitely isn’t easy because it involves identifying flaws that are off by just fractions of an inch. Sun discovered that she could identify these miniscule design defects when cards were rotated 180 degrees.
Ivey and Sun Beat Casinos at Their Own Game
While Kelly Sun had done well at gambling herself, she didn’t have the kind of capital required to make millions in a short time span. Enter Phil Ivey.
With a $100 million net worth and a hunger for gambling, Ivey was the perfect partner. An ex-boyfriend of Sun’s introduced her to Ivey.
The pair then worked out a plan to crush casinos by edge sorting in punto banco games. Ivey supplied the bankroll while Kelly provided her immense knowledge.
Sun, meanwhile, would watch the cards and signal Ivey on what values were coming next. She talked the Mandarin-speaking dealers into rotating cards 180 degrees because “Ivey was superstitious.”
They were able to win $11 million at Crockfords, $10 million at the Borgata, and $9 million at a combination of other casinos. Crockfords and, later, the Borgata sued to reclaim their losses.
Judges Side With the Casinos
They say that the house always wins. In the case of Ivey and Sun, this saying apparently applies to the courtrooms, too.
Judges in both London and New Jersey heard cases regarding the duo’s edge-sorting efforts. Both justices sided with the casinos through similar rulings.
Neither judge believed that Ivey thought he was truly cheating casinos. However, they each ruled that edge sorting ultimately cheats the house, whether the pro gambler believes it or not.
Ivey was ordered to repay the $11 million that he won from Crockfords in 2014. He was ordered to repay the Borgata $10 million in winnings in the same year.
The New Jersey judge did rule, however, that Ivey didn’t have to cover $500k worth of comps that he received from the Borgata.
Professor Examines Whether Ivey and Sun Truly Cheated
Lawyer Nanci Carr, who’s an assistant professor of business law at California State University, Northridge, has been fascinated with this edge-sorting case.
The lengthy paper looks at how judges accused Ivey and Sun of cheating. It also dives into whether or not the duo actually cheated or simply exploited flaws in the system.
Carr originally set down the path of determining if the pair cheated after reading a piece in Cigar Aficionado. After digesting the piece, she believed that Sun and Ivey used an advantage rather than blatantly cheating.
In her work, the California-based attorney points out how casinos hold many advantages over players. However, they’re never accused of cheating after consistently winning.
Carr Doesn’t Believe That Sun and Ivey Did Anything Wrong
One key to this case is the exotic demands that Ivey made before taking the table. Again, he asked for a Mandarin-speaking dealer, purple Gemaco deck, and rotated cards. He also requested an automatic shuffler, which aids in edge sorting.
At issue is whether these demands constituted cheating. Everything that Ivey requested helped he and Sun beat the house.
In Carr’s eyes, though, these favors don’t equate to cheating at all. The main reason why is because the casino agreed to every single request.
As Carr argues in the paper, he wasn’t using an illegal device to gain a leg up on casinos. Instead, he just made requests that the house granted.
Of course, what Ivey wanted isn’t much different than the many methods that casinos use to beat players. They give out free alcohol and casino comps to ply gamblers into betting more. They also hold an advantage in almost every single game (albeit a few video poker variations).
How Does Ivey’s Case Affect the Future of High Rollers?
Casinos never want to relinquish their advantage, especially when it means potentially losing millions of dollars. Rather than accept their losses to Ivey, the Borgata and Crockfords sought the help of judges to get their money back.
Both casinos were successful in their efforts. However, what are the long-term consequences for the gaming industry?
This was the question on Carr’s mind while writing the paper. She ponders if casinos will continue doing everything possible to prevent casino whales from winning. Or will they still grant special requests to keep high rollers coming back. Carr states:
“The casino needs them. What’s going to happen next time [the casino] wants a million-dollar advance, and they ask for an auto shuffler?”
She points out that everybody wants to improve their chances of winning, whether they buy the best golf clubs or tennis racquet. Some high rollers will be more apprehensive if they’re denied certain requests that improve their odds.
This Case Also Draws Interest From the Film Industry
Carr and Harvard aren’t the only ones interested in this gambling story. First reported in February 2020, SK Global’s The Baccarat Machine movie will chronicle how Sun and Ivey toppled casinos—only to be forced to return the winnings.
Famous for roles in Crazy Rich Asians and The Farewell, Awkwafina is set to play Sun in the movie. The Baccarat Machine is based on the same-titled Cigar Aficionado article that drew Carr’s interest.
No other actors besides Awkwafina are scheduled to play in the film to date. Therefore, The Baccarat Machine looks to be based more on Sun than Ivey.
The movie’s synopsis supports this hunch:
A Gambling Story for the Ages
Phil Ivey’s and Kelly Sun’s punto banco story was certainly big news at the time. However, I never expected it to come up in a Harvard-published paper and the film industry years later.
Years after the cases have been decided, though, lawyer Nanci Carr analyzed this story through an in-depth paper. The work is good enough to find a spot in the Harvard Journal of Sports & Entertainment Law.
SK Global will also cover this tale soon through the film The Baccarat Machine. Starring Awkwafina, The Baccarat Machine will provide an in-depth look at Kelly Sun’s life and gambling career.
In summary, I thought that this story might have fizzled out by now. However, it’s actually proving to be one of the most legendary gambling tales of all time.