Slot player’s jackpot appeal faces long odds in Nevada Supreme Court

Scott Sonner

Friday, April 30, 1999 | 3:48 a.m.

RENO, Nev. - From the cigar-chomping gambler to the little old lady with a bucket of nickels, everyone who ever pulled the handle on a slot machine has dreamed - if only for a moment - of hitting the big jackpot.

Cengiz "Gene" Sengel thought he did it on Sept. 21, 1996, when he lit up a one-armed bandit with three jackpot symbols at the Silver Legacy Hotel & Casino.

Nearly three years later, he's still fighting the slot maker for the $1.8 million payoff - the first legal battle of its kind to go all the way to the Nevada Supreme Court.

"It was supposed to be a dream come true," said Sengel, who took a wrong turn at Lake Tahoe and ended up in downtown Reno with $20 worth of quarters in his pocket on that fateful night.

"But now it is a big mess. It has become a horrible experience."

Sengel, 39, of Redwood City, Calif., knows he faces long odds. He already has lost appeals before the State Gaming Control Board and Washoe County District Court.

Both sided with the slot-maker, International Game Technology, which says the jackpot symbols were not aligned uniformly on the pay line.

"Close only counts in horseshoes, not on jackpots," said Ken Creighton, spokesman for the Reno-based IGT.

Judge Peter Breen said it was only logical to assume that for a jackpot to occur, the symbols must be in a straight line, with half of each symbol above the payline and half below.

"I've never been paid for when the line didn't bisect the middle of the cherry," he offered during a hearing last year.

"That is what is expected, not touching the bottom of one side and the top of another and the middle of still a third," the judge said.

Sengel and his lawyer disagree. In what amounts to a contract, they say, the Quartermania slot machine states on its face plate, "On payline with two coins played wins progressive."

"That's 'on' payline, not 'bisects' payline," lawyer John White said.

At least one witness testifying on Sengel's behalf agrees.

"During the many years of my experience, Harrah's was always ready and willing to pay a jackpot so long as the symbols were on the payline," said Joseph "Bud" Garavanta, a 25-year veteran of the industry who was Harrah Reno's slots director for 10 years. "They did not have to be bisected."

White likens it to a field goal in a football game. The ball must travel between the goal posts in order for the goal to count. It is not required to bisect the goal posts.

There would be nothing wrong with changing the rule to require that field goals bisect the posts, he says. But "it would be unsporting ... for the referees to let the teams play where only one of the teams had been made aware of the new rule," White said.

The case has the potential to set a precedent in an industry that got its start in Nevada nearly a century ago. It already has prompted the state Legislature to approve a bill that expands the definition of the kind of "malfunctions" that void payoffs on slot machines.

White, a Reno bankruptcy lawyer who has represented casinos before, says wagering contracts are among the simplest and most common, beginning with children who "play marbles and bet bubblegum on the outcome.

"Kids in back alleys throw dice and pay rewards based upon the numbers that show on the dice when they stop rolling," he said.

"There are no lawyers in the back alleys where these dice games are played," he said. "If this were a game in a back alley, IGT would have paid. People who welch on their bets don't do too well in back alleys."

White also points to what he calls the dirty little secret about modern slot machines with huge progressive jackpots: Unlike the old-fashioned free-spinning reels, the new reels don't stop randomly. They are directed to stop by a computer chip inside the machine known as the "random number generator."

The higher the payoff, the more unlikely the combination, with odds reaching as high as 8 million-to-1 instead of traditional 8,000-to-1.

In Sengel's case, the computerized replay mechanism inside the machine showed that the symbols that appeared in the windows were not the ones generated by the random number generator.

White said that shouldn't matter.

"Is what you see what you get, or not?" he said. "To me, unless we are going to say it's all smoke and mirrors, they've got to pay this jackpot."

The state board disagreed. It ruled that if there is a disparity between what the chip directed and what appears in the payoff windows, the chip's directive prevails. Any result on the payline not put there by the chip is void.

If that is true, then "the reels are not real," White said. "They are irrelevant to the game. They are just window dressing designed to make the game appear more exciting."

In Sengel's case, the machine stopped on the skewed symbols because it detected a dollar bill counter door inside the machine was open, which resulted in the machine randomly stopping in its tracks regardless of which symbols were in the window.

IGT says there's no secret to the way the machines work.

"State law - not a policy, not some secret intent of IGT - requires that the outcome of these games be generated on a random number generator," said Dan Reaser, a lawyer for IGT and former legal counsel to the state board.

About three-fourths of the payoff disputes formally investigated each year by the Nevada Gaming Commission involve slot machines.

Of the 1,056 investigations statewide in 1998, only 77 progressed to formal hearings before the State Gaming Control Board. Only three of those advanced to district court, like Sengel's. They remain unresolved.

Sengel, who was born in Turkey and graduated from the U.S. Naval Postgraduate School in Monterey, Calif., said that the light on top of the slot started flashing "and people started congratulating me."

But Reaser said that light - known in the business as the "candle" - was flashing in a pattern that meant a "tilt" or malfunction had occurred.

"No music played. No bells or whistles went off," he said.

Casino officials opened the machine, determined a malfunction, not the chip, had caused the spinning reels to stop, and told Sengel he had won nothing. Sengel took a picture of the tell-tale symbols, and drove home to the San Francisco Bay area in frustration.

The Silver Legacy won't comment on the case, spokeswoman Deanna Ashby said. IGT owns the slot machine and would be responsible for paying the progressive jackpot.

Reaser said in IGT's latest court filings in March that the "terms of the offer were clear and unambiguous."

"Mr. Sengel wants to somehow attack the use of the random number generator as a way to get around the fact that even if the machine did not have the random number generator ... Mr. Sengel's claim would fail because he never had a winning alignment," he said.

"On the very face of the glass, it shows that to win the maximum award, there has to be an even alignment of each of the reel strip characters. There is not an even alignment," he added.

Sengel works as a computer systems administrator at Oracle Corp. in Redwood Shores, Calif., but said he doesn't understand how the slot machine works.

"As a simple tourist, you don't know anything about the inner workings of the machines," he said. "My lawyer gets into all the details, but from my mind, we played this machine and we got the symbols on the payline... We got the jackpot but they haven't paid us."

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