The Borgata Hotel Casino & Spa has been dealt a major setback in its efforts to make a playing-card manufacturer repay the $9.6 million that a professional poker player won in an edge-sorting scandal.

Celebrity poker player Phil Ivey won that amount in a 2012 Baccarat marathon with help from an assistant who can identify face-down cards through tiny printing flaws on their backs. But the most the casino could recover from the card company at trial is $26, which is the amount it paid for the cards, U.S. District Judge Noel Hillman ruled Monday.

Borgata sued Ivey and his assistant, Cheng Yin Sun, after their big win, and an order for $10.1 million—encompassing $504,000 that Ivey won at craps using his baccarat winnings—was entered in December 2016. Ivey and Sun are seeking to appeal the ruling, but Hillman has ruled that they may not do so until Borgata prosecutes its claims against Gemaco over the cards.

Both Borgata and Gemaco seek summary judgment in the dispute between them. Gemaco argues that Borgata has already received a judgment for the claims against Ivey and Sun, and Borgata is not entitled to a duplicate recovery from Gemaco. Gemaco also claimed that Borgata's common-law claims for  breach of contract, negligence, respondeat superior and declaratory judgment for contribution and indemnification are barred and that the Uniform Commercial Code is the exclusive remedy for claims of economic loss due to a defective product.

Hillman said Ivey could not pull off their scheme without the manufacturing flaws on the cards. But they were only one part of the scheme, he said. But Borgata failed to show that the cards, standing alone, were the precipitating cause of the scheme. Before Ivey visited Borgata, he had a list of demands—a private area in which to play, a casino dealer who spoke Mandarin Chinese, permission for Sun to sit with Ivey at the table, one 8-deck shoe of purple Gemaco playing cards to be used for the entirety of each session of play, an automatic card shuffling device, which retained the orientation of each card that Sun requested to be turned.

“If even one of those key elements were missing, the edge-sorting scheme would not work,” Hillman said.

In routine tort cases, the law requires proof that the result complained of probably would not have occurred but for the negligent conduct of the defendant, Hillman said. Where concurrent causes of harm are present, the law requires consideration of the substantial factor test, he said. “The 'but for' standard concentrates on one cause that sets the other causes in motion, while the 'substantial factor' test recognizes that a tortfeasor will be held answerable if its negligent conduct was a substantial factor in bringing about the injuries, even where there are other intervening causes which were foreseeable,” he said.

Hillman found that the proximate cause to hold Gemaco liable for Ivey's and Sun's gambling winnings is lacking. This is because Borgata has not shown that the Gemaco cards, standing alone, were the precipitating cause of the scheme.

It is not Gemaco's cards that were the “but for” cause of Borgata's losses, but rather all the subsequent required elements agreed to by Borgata, Hillman said.

Without a viable tort remedy against Gemaco, Borgata's only potential relief against Gemaco is for breach of warranty under the UCC, Hillman said. Hillman said he could not enter summary judgment for either party because disputed material facts remained that require the assessment of credibility on both sides.

Hillman said he would provide the parties three choices—proceed to trial on Borgata's breach of warranty claims, stay those claims and certify Borgata's judgment against Ivey and Sun as final so they may proceed with their appeal, or afford Borgata and Gemaco a period of time to seek private resolution of their dispute. The judge gave the parties 15 days to make up their minds which path they want to take.

West Orange attorney Jeremy Klausner, who represents Borgata, said his client would not comment on the litigation.

Jeffrey Mazzola of William Staehle's office in Morristown, representing Gemaco, did not return a call.

Edwin Jacobs Jr. of Jacobs & Barbone in Atlantic City, who represents Ivey and Sun, could not be reached for comment.