IN THE SUPREME COURT OF MISSISSIPPI
NO. 1999-SA-01476-SCT
JAMES C. THOMAS
v.
ISLE OF CAPRI CASINO AND CDS SYSTEMS
DATE OF JUDGMENT: 07/30/1999
TRIAL JUDGE: HON. JERRY O. TERRY, SR.
COURT FROM WHICH APPEALED: HARRISON COUNTY CIRCUIT COURT
ATTORNEYS FOR APPELLANT: HENRY BERNARD ZUBER, III
KRISTIN L. DVORSKY
SARA E. COOK
ATTORNEYS FOR APPELLEES: KATHRYN H. HESTER
KEITH R. RAULSTON
CHARLIENE ROEMER
NATURE OF THE CASE: CIVIL - STATE BOARDS AND AGENCIES
DISPOSITION: AFFIRMED - 02/15/2001
MOTION FOR REHEARING FILED: 3/1/2001; denied 4/12/2001
MANDATE ISSUED: 4/19/2001
BEFORE PITTMAN, C.J., McRAE, P.J., AND WALLER, J.
McRAE, PRESIDING JUSTICE, FOR THE COURT:
¶1. This appeal arises from a dispute between a casino patron, James Thomas ("Thomas"), the Isle of Capri
Casino ("the Isle"), and Casino Data Systems ("CDS"), which owns the progressive slot machines and
manages the systems that monitor the machines at the heart of this controversy. Thomas claims to have won
two multi-million dollar progressive slot machine jackpots, while the Isle and CDS disagree.
¶2. The issue central to this appeal involves the spoliation of evidence caused by CDS's and the Isle's
removal and dismantling of the slot machine while this controversy was pending, causing its memory to be
erased. Furthermore, the circuit courts of Jackson and Harrison counties correctly denied Isle's and CDS's
motion to dismiss for lack of jurisdiction. We reluctantly affirm the judgment of the Harrison County Circuit
Court, as the Gaming Commission and the hearing examiner's decision was supported by the evidence.
PROCEDURAL HISTORY
¶3. In the late night or early morning hours of October 14 and 15, 1995, James Thomas claims to have
won two progressive jackpots on a single slot machine at the Isle of Capri Casino ("the Isle"). After the Isle
and CDS refused to pay the jackpots, Thomas filed a complaint with the Mississippi Gaming Commission
("Commission"). An investigation was conducted by agent Debbie Fry on behalf of the Executive Director,
who determined that no jackpot was won by Thomas.
¶4. Thomas appealed the Executive Director's decision, and a hearing was conducted before Hearing
Examiner Larry Stroud over the course of three sessions in the fall of 1996. The Hearing Examiner found
for the Isle and CDS and was affirmed upon later review by the Commission. Thomas appealed the
Commission's order to the Circuit Court of Jackson County, and this appeal was subsequently transferred,
rather than dismissed, to the Circuit Court of Harrison County, Second Judicial District, which affirmed the
judgment of the Commission in its decision of July 30, 1999.
FACTS
¶5. James Thomas is a resident of Chicago, Illinois, and had never been to a casino before arriving at the
Isle of Capri Casino with several friends on October 14, 1995. Thomas was playing a Cool Millions
progressive slot machine between 10:30 p.m. on October 14 and 1:00 a.m. on October 15 when he claims
to have won two primary progressive jackpots. The Cool Millions machines are owned and monitored by
Casino Data Systems, which is responsible for paying all jackpot awards.
¶6. According to Thomas, he began playing Cool Millions slot machine number 2947 at approximately
11:00 p.m., playing three coins at a time. After playing for a brief period, the machine locked up and began
to make noises. Whistles were blowing, bells sounded, and to his left a light flashed white on top and blue
on the bottom. At this time, Thomas testified, "three animals" were lined up across the pay line. According
to Thomas, the three symbols that were lined up on the pay line looked like frogs, which matched the
combination that was indicated on the top of the machine to be the winning combination for the highest
jackpot. Thomas testified that, at this time, the jackpot was "two million point seven hundred and some odd
thousand dollars."
¶7. Thomas was first approached by two unidentified female employees. Thomas testified that Lou
Shampang, slot supervisor for the Isle, then walked up and said "So you got it?" "I said, 'Yes, I hit it.'"
Shampang then opened the door of the machine while another man, said to be a slot technician, approached
and entered the machine. Thomas says that the two men and the door of the machine blocked his view,
preventing him from seeing what they were doing in the machine, but that when they were finished the reel
combination that was on the screen was gone and the technician left quickly. Thomas testified that
Shampang then put a coin in the machine and pulled the lever.
¶8. According to Thomas, he asked Shampang why he removed the jackpot combination, to which he
replied "You didn't hit." "I said 'You done taken it off the reel. I hit it.'" Shampang then placed a card in the
coin slot of the machine. "So I asked him, I said, 'Why is that?' He say, 'It's down.' I said, 'Down? What
you mean it's down?' He wouldn't say anything. 'Call the Gaming Commission.'" "When I asked him who is
the Gaming Commission, he said he didn't know. I say, 'You know their number?' He said 'No.' I said
'Well, how can I call them?' He just looked at me."
¶9. Shortly thereafter, Shampang removed the card from the coin slot, and Thomas resumed play on the
same machine as before. At approximately 1:00 a.m., Thomas claims to have been playing three coins and
hit a second jackpot on the same machine. He testified that machine locked up as before, that bells were
ringing and lights flashing, and that three animals were lined up on the pay line. Thomas testified that he was
not sure of the color combination of the animals, just that they looked like frogs, were the same as those
that were lined up in the previous "jackpot winning," and that they matched the winning symbols indicated
on the face of the machine as being the highest Cool Millions jackpot. At this time, Thomas said the
progressive display showed the jackpot total to be "two million point seven hundred and some odd
thousand dollars."
¶10. At this time, Thomas testified that Shampang and slot shift supervisor Keith Vincent, approached.
When he told them that he had "hit it" again, one of them put a key into the right side of the door, opening it.
Vincent then went into the machine and "stayed there a while, wrote some numbers down, and he put his
hand up in there." Thomas testified that his view was blocked by the door of the slot machine, but that when
Shampang and Vincent were finished, the reels were changed so that a winning combination was no longer
displayed. "I asked him why did he do that and he said, 'You didn't hit.' I said, 'Yes, I did.' He said, 'No,
you didn't.' I said, 'Well, give me your card. I hit. I know I hit. Everything matches.'"
¶11. Before leaving the casino, Thomas was provided with the telephone number for the Gaming
Commission, which he called, reaching a recording that said the Commission was closed until Monday. On
the following Monday, October 16, 1995, Thomas spoke with Donnie Dobbs of the Gaming Commission,
who told him to write a summary of the events and mail it to Richard Randall. Thomas did so on October
23, 1995. Thomas's letter to Dobbs included the names of potential witnesses, with addresses and
telephone numbers.
¶12. At the hearing, Lawrence James and Elijah Brown testified that they accompanied Thomas to the
casino and heard Thomas proclaim "I got it." According to James and Brown, three animals were lined up
along the pay line that matched the jackpot symbols displayed on the front of the machine, and the machine
was making noise and the lights were flashing. James testified that he later heard Thomas proclaim that he
"got them again," and he that he again saw the same three animals on the pay line. Vera Brown testified that
she heard that Thomas won and when she approached the machine, it was making noise and the white and
blue lights were flashing. She testified that there were three animals on the pay line that matched the jackpot
symbols.
¶13. According to Louis Shampang, slot supervisor for the Isle, the machine Thomas was playing at no time
displayed a winning combination. He said that the machine was not locked up, but that Thomas was putting
coins into the slot before the reels had stopped spinning, so that the coin did not register. Therefore, when
he pulled the handle the reels would not spin. Shampang further testified that he opened the machine and
cleared a coin jam from it. Thomas continued to play and complained that "the machine was not paying
correctly." The next time Shampang saw Thomas was just before Thomas left the casino when he explained
to Thomas "his only recourse was to contact the Gaming Commission."
¶14. After failing to satisfy Thomas in regard to the first purported jackpot, Shampang called his supervisor,
Don Weaver, to whom Thomas indicated that he believed he had won the jackpot. Weaver testified that
they were then joined by slot technician Leonard Masino. "We ran it through a few tests. The game
appeared to be functioning as it should."
¶15. Masino initially testified that he ran a hopper test to ensure that the machine was paying properly,
checked the Central Processing Unit (CPU) of the machine, ran a last game recall test, and a reel test, all of
which indicated the machine was working properly. On cross-examination, Masino testified that he did not
perform a CPU test on the machine Thomas was playing, as he did not have the key required to access the
CPU of the Cool Millions machines.
¶16. Keith Vincent, assistant slot manager on the night in question, testified that he was called to machine
2947 after Thomas claimed to have won the second jackpot. Vincent testified that when he arrived,
Thomas told him that he had not been paid for his win, and that three red bars were showing on the pay
line. Vincent performed a last game recall test and a hopper test, which required him to open the machine.
Contrary to casino policy, he failed to note the entry on the machine's Machine Entry and Access Log
(M.E.A.L) card.
¶17. On the night in question, Thomas was playing a Sigma slot machine, which has internal monitoring
mechanisms, as well as the external monitoring systems run by CDS and the Isle. The machine itself has the
ability to recall previous game outcomes. It can recall the number of jackpots won in the past, and the
amount of time lapsed since the last jackpot. It is undisputed that, had the machine been available for such a
test, it would have provided conclusive evidence whether Thomas actually won the jackpot when he claims
he did. Once the CPU of a Sigma slot machine is removed, it can retain its memory for at least six months.
The Isle or CDS employees never tested the CPU memory of machine 2947 for jackpots. The test to
determine how much time has elapsed since the last jackpot takes just a few seconds and is described in the
handbook provided by the manufacturer, Sigma Games.
¶18. In addition to internal monitors, the progressive slot machines are connected to two external tracking
systems that monitor the machines and are run by both CDS and the Isle. Neither of these tracking systems
recorded a jackpot on the night in question. The record shows that if these systems are plugged into the
machine improperly, or if they are misaligned, or if the connections are loose, the tracking systems may fail
to receive information from the slot machine. If this were to happen, it would be possible for the external
tracking systems to fail to receive signals sent from the slot machine. In that event, the CPU of the machine
would still contain that information, even though it was not transmitted to the external monitoring systems.
Thomas's expert, Frank Shiels, testified that certain portions of the external tracking systems can fail to
receive signals without causing the entire system to fail, and that "some of the meters can communicate while
others do not."
¶19. To win a Cool Millions jackpot, a patron would have to play three coins, and red, white and blue
ducks would have to line up on the pay line in that order. When this happens, the game is designed to lock
up, both the white and blue tower lights will illuminate, and the machine will play a song. In addition, the
progressive jackpot display sign should reset to $1 million. A Sigma slot machine can be played with fewer
than three coins, though three coins must be played to win the multi-million dollar primary progressive
jackpot.
¶20. On December 21, 1995, machine 2947 and one other slot machine were removed from the Isle,
despite of the fact that the Isle was given notice on November 17, 1995, that Thomas was appealing the
Gaming Commission's decision. The Isle claims that it decided to replace the two wall-mounted machines
with two stand-alone machines because "they were generating less than one-tenth the play of other
progressive machines in the same location." According to the Isle, these two machines were selected
because their removal would not require the relocation of the Cool Millions sign above the machines.
According to CDS, it did not receive notice of the dispute until March, 1996. After learning of the dispute,
CDS did nothing to locate the memory components of the machine at issue.
¶21. After the removal of the machines from the Isle, the CPU of machine 2947 was put to use as a
"backup board." These backups are kept to use as replacement parts in other machines owned by CDS.
CDS Technical Supervisor Willie Orr testified that the replacement CPUs are co-mingled, and that the
board from machine 2947 could have been installed in another casino, or it could still be in CDS's
possession, possibly locked in a service van. As previously stated, the CPU of a Sigma slot machine can
retain its memory of all jackpot awards for more than six months after being removed from the machine. A
simple test of the CPU would have rendered dispositive evidence in this dispute.
¶22. Orr testified that, once removed, the CPUs are not marked in any way to indicate in which machine
they were originally placed. He estimated that CDS keeps approximately six to eight backup CPU boards.
Once placed into another machine, the memory is erased and would not retain information from machine
2947. Before the memory components of the machine were "recycled," neither the Isle, nor CDS, nor the
agent for the Gaming Commission ever tested machine 2947's memory to determine conclusively the
elapsed time since a jackpot was won.
¶23. Thomas's initial contact with the Gaming Commission was with Donnie Dobbs, who took a telephone
statement from Thomas on October 17, 1995. Dobbs filed a written report prepared from the notes of the
conversation, which were since destroyed. Thomas and his eyewitnesses dispute the accuracy of the report.
¶24. Debbie Fry was a new and inexperienced agent at the time she was charged with handling the
investigation into Thomas's claim on behalf of the Gaming Commission. In a letter to Thomas on October
30, 1995, she concluded that Thomas had not won a jackpot. She based her conclusion on the statements
of Isle employees, on the report filed by Dobbs, on a videotape copy of casino surveillance, and on
interviews with Louis Shampang and Keith Vincent. At no time did she speak with or otherwise interview
Thomas or his eyewitnesses. She did not examine the machine and had no knowledge of the information
contained in the machine's CPU.
¶25. In handling this dispute, the Isle failed to follow its own policy. When a patron is involved in a disputed
claim and the slot supervisor has concluded that the casino should not pay it, the slot surveillance
department should be notified. The surveillance department was not notified of Thomas's dispute and did
not, therefore, focus the cameras on the machine Thomas was playing during this dispute. This omission was
in violation of casino policy and resulted in the hearing examiner's reliance on a videotape of very poor
quality.
¶26. More importantly, the Isle failed to follow the procedure required by the Mississippi Gaming Control
Act for handling such disputes. The relevant portions of the applicable statute are as follows:
(1) Whenever a licensee refuses payment of alleged winnings to a patron, the licensee and the patron
are unable to resolve the dispute to the satisfaction of the patron and the dispute involves:
(a) At least five hundred dollars ($500.00), the licensee shall immediately notify the executive director
...
(3) Failure to notify the executive director . . . as provided in subsection (1) is grounds for disciplinary
action pursuant to Sections 75-76-103 through 75-76-119, inclusive.
Miss. Code Ann. § 75-76-159 (2000).
¶27. According to the Gaming Control Act, the casino, not the patron, is responsible for reporting such
disputes to the Commission. The only action taken by the Isle to notify the executive director was just
before Thomas left the casino, when Shampang advised Thomas to call the Gaming Commission. This type
of action should not be tolerated by the Commission.
STANDARD OF REVIEW
¶28. The standard of review for this casino patron dispute is governed by the Mississippi Gaming Control
Act, Miss. Code Ann. § 75-76-171 (3)(d) (2000), which states that an order of the Gaming Commission
may be reversed "if the substantial rights of the petitioner have been prejudiced because the decision is . . .
unsupported by any evidence." In Mississippi Gaming Comm'n v. Freeman, 747 So.2d 231, 239
(Miss. 1999), this Court held that the "any evidence" standard applies to patron disputes under the Act, and
overturned the circuit court's application of the substantial evidence standard. The "any evidence" standard
was again applied to a patron dispute by this Court in IGT v. Kelly, No. 1998-CC-01783-SCT 2000
WL 424531, at * 2 (Miss. Apr. 20, 2000).
DISCUSSION
I. Whether the Harrison County Circuit Court was within its jurisdiction in hearing Thomas's
appeal of the Gaming Commission's decision.
¶29. Thomas filed his appeal in the Jackson County Circuit Court, which denied the Isle and CDS's motion
to dismiss for lack of jurisdiction and transferred the case to the Circuit Court of Harrison County. Isle and
CDS contend that Thomas filed his complaint in the wrong circuit court, that the Jackson County Circuit
Court should have dismissed his cause for lack of jurisdiction rather than transferring it to the Harrison
County Circuit Court, and that Thomas's appeal should be dismissed because it was not timely perfected.
¶30. The Isle and CDS argue that the legislature only vested jurisdiction to review Gaming Commission
decisions of patron disputes in the circuit court of the county in which the dispute arose. To support this
contention, the Isle and CDS cite Miss. Code Ann. § 75-76-167(1) (2000), which states the following:
Any person aggrieved by a final decision or order of the commission made after hearing by the
commission pursuant to sections 75-76-159 through 75-76-165, inclusive, may obtain a judicial
review thereof in the circuit court of the county in which the dispute between the licensee and
patron arose.
(emphasis added).
¶31. This section governs the patron dispute at bar. Section 75-76-167 is placed among other sections
which deal with patron disputes.
¶32. However, the Mississippi Constitution specifically provides that a suit improperly filed "in the circuit
court" will be transferred to the appropriate chancery court, which will treat the case as if it was properly
filed. Miss. Const. art. 6, § 157. A complimentary provision of the constitution requires that causes filed in
the chancery court, over which the circuit court has exclusive jurisdiction, shall be transferred to the circuit
court. Id. art. 6, § 162.
¶33. The constitution further provides that no civil judgment will be reversed solely for lack of jurisdiction
when a non-equity case is erroneously filed in the chancery court, or vice versa. Id. art. 6, § 147. In
interpreting section 147, this Court has held that:
[T]he court is not to be constrained by the literal meaning of words used and as then used . . . and
particularly is this true in respect to provisions intended to prevent or remedy definite evils, otherwise
the same evils, in whole or in part, under new names or different guises, could find another foothold
within the same structure that was designed to keep them out."
Moore v. General Motors Acceptance Corp., 155 Miss. 818, 125 So. 411, 412 (1930). This Court
went on to hold that section 147 also applies to actions filed in county court, even though the terms of the
provision specifically state that it applies to "chancery or circuit" courts. In doing so, we refused to be
confined to the terms "chancery" court and "circuit" court, so that litigation leading to a decree that is correct
on the merits should not be reversed solely on the basis that the case was filed in a court without
jurisdiction. Id. at 413.
¶34. In the case at bar, the Jackson County Circuit Court refused to dismiss Thomas's claim by analogizing
the appeal of Gaming Commission decisions to the judicial review statute of the Mississippi Workers'
Compensation Act. That section, Miss. Code Ann. § 71-3-51 (2000), states that appeals of Commission
decisions should be taken in "the circuit court of the county in which the injury occurred." The circuit court
correctly observed that this statute should relate to venue, rather than jurisdiction, and rejected an argument
similar to that rejected in Leake County Coop. (A.A.L.) v. Barrett's Dependents, 226 So.2d 608
(Miss. 1969).
¶35. As the foregoing authority makes clear, jurisdictional and venue statutes are to be construed in the
interest of justice, so that a legitimate claim, resolved correctly on the merits, will not be forfeited by filing in
the wrong court. Regardless of whether Miss. Code Ann. § 75-76-167 (2000) confers jurisdiction or
connotes venue, the proper course of action when a Gaming Commission decision is appealed to the wrong
court is to transfer the action to the proper court. Otherwise, a claim could be inadvertently filed in the
wrong court, subsequently dismissed, and then time-barred in the proper court. This is what the Isle and
CDS ask this Court to do. We decline this invitation.
II. Whether the hearing examiner applied the proper legal standard for spoliation of
evidence.
¶36. The information contained in the CPU of slot machine 2947 would have conclusively established
whether Thomas had in fact won any jackpots on the night in question, and how much time had elapsed
since it occurred. Before the memory components of the machine were "recycled," neither the Isle, nor
CDS, nor the agent for the Gaming Commission ever tested the machine's memory to determine
conclusively the elapsed time since a jackpot was won. The actions of the Isle and CDS in removing and
"recycling" machine 2947 have caused the permanent and irretrievable loss of this information.
¶37. When evidence is lost or destroyed by one party (the "spoliator"), thus hindering the other party's
ability to prove his case, a presumption is raised that the missing evidence would have been unfavorable to
the party responsible for its loss. According to Wigmore:
[S]poliation and all similar conduct is receivable against him as an indication of his consciousness that
his case is a weak or unfounded one; and from that consciousness may be inferred the fact itself of the
cause's lack of truth and merit. The inference thus does not necessarily apply to any specific fact in the
cause, but operates indefinitely though strongly against the whole mass of alleged facts constituting his
cause.
2 J. Wigmore, Evidence § 278, at 133 (J. Chadbourn rev. 1979). Because the presumption of
unfavorability is not solely confined to the specific issue of what information was contained in the missing
evidence, the fact finder is free to draw a general negative inference from the act of spoliation, regardless of
what the spoliator's rebuttal evidence shows.
¶38. The Isle and CDS argue that the negative presumption raised by spoliation "may only be drawn when
the destruction is unexplained or deliberate." However, the information contained in machine 2947 was not
lost by act of God or in a fire, but was destroyed by the actions of Isle and CDS when at least one of them
was aware of the pending dispute.
¶39. If not intentional, their actions were at least grossly negligent. The casino was under a statutory duty to
contact the Commission when it became clear that the dispute had not been resolved to Thomas's
satisfaction. Had the Isle done so, a more thorough investigation may have ensued, and the slot machine
would have been preserved. Therefore, it cannot be said that the information contained in the CPU of
machine 2947 was lost through no fault of the Isle or CDS.
¶40. Requiring an innocent litigant to prove fraudulent intent on the part of the spoliator would result in
placing too onerous a burden on the aggrieved party. To hold otherwise would encourage parties with
weak cases to "inadvertently" lose particularly damning evidence and then manufacture "innocent"
explanations for the loss. In this way, the spoliator could essentially destroy evidence and then require the
innocent party to prove fraudulent intent before the destruction of the evidence could be used against it.
¶41. Other jurisdictions have held that both intentional and negligent loss of evidence can constitute
spoliation. See, e.g., Public Health Trust v. Valcin, 507 So.2d 596, 599 (Fla. 1997). In Valcin, the
Florida Supreme Court held that the negligent failure to maintain medical records pursuant to statutory duty
gives rise to the negative inference that the records would be unfavorable to the spoliator. Id. "The
presumption remains in effect even after the party to whom it has been shifted introduces evidence tending
to disprove the presumed fact." Id. at 600. Whether the negative inference has been overcome then
becomes a question of fact. Id. See also Welsh v. United States, 844 F.2d 1239, 1246-47 (6th Cir.
1988) (holding that the negligent loss or alteration of medical records gives rise to negative inference);
Sweet v. Sisters of Providence in Washington, 895 P.2d 484, 492 (Alaska 1995) (holding that
negative presumption is raised absent a finding of fact that the loss of a medical record is excused).
¶42. This Court adopted a similar rule in DeLaughter v. Lawrence County Hosp., 601 So.2d 818, 822
(Miss. 1992). In DeLaughter, we held that "where a (medical) record required by law to be kept is
unavailable due to negligence, an inference arises that the record contained information unfavorable to the
hospital, and the jury should be so instructed." Id. (emphasis added).
¶43. The failure of the Casino to follow the dictates of the Gaming Control Act, and the Isle's and CDS's
failure to preserve the slot machine therefore resulted in a presumption that the evidence contained in the
CPU of machine 2947 was unfavorable to the those responsible for its destruction. In spite of this
presumption, the hearing examiner, however, had ample secondary evidence on which to base his findings.
¶44. At the hearing, the records of both the CDS independent slot tracking system and the Isle independent
slot tracking system were admitted in evidence. The examiner concluded that both were functioning
properly at the relevant times and indicate that no jackpot was won. He also had experts to describe the
function of the machine in jackpot mode and a surveillance tape, though of admittedly poor quality, for
comparison. Though the numerous witnesses offered conflicting testimony, the hearing examiner, as the
finder of fact, was responsible for judging their veracity. The decision was therefore based on evidence and
does not meet the "unsupported by any evidence" standard to require a reversal.
CONCLUSION
¶45. For the foregoing reasons, the Harrison County Circuit Court had jurisdiction to hear Thomas's
appeal, and the Jackson County Circuit Court was correct in transferring this case to the Harrison County
Circuit Court, which was the proper venue under Miss. Code Ann.§ 75-76-167(1) (2000). The negligent
destruction of the slot machine, the most probative evidence in this case, by the Isle and CDS raises a
negative presumption against the spoliators. However, the hearing examiner found that the presumption had
been rebutted by other evidence. As his decision was based on evidence properly admitted, we cannot say
that his decision was not based on "any evidence." Therefore, the judgment of the Harrison County Circuit
Court is affirmed.
¶46. AFFIRMED.
BANKS, P.J., MILLS, WALLER, COBB, DIAZ AND EASLEY, JJ., CONCUR.
PITTMAN, C.J., AND SMITH, J., CONCUR IN RESULT ONLY.