1941-1952

The 1941 breakout of war between the U.S. and Japan started a series of deleterious events for Nevada’s first tango parlor Reno Club, Inc. and its proprietors. These included a tangle with a newcomer to the region’s gambling industry, William “Bill” F. Harrah.

Longstanding Bingo Business

A group of Japanese-American men, all U.S. citizens, debuted a gaming club in June 1931 at 232 N. Virginia Street in The Biggest Little City. Along with tango (also called bingo), the place  offered hazard, 21, craps and roulette. The owners were:

• Ben Furuta, president
• Fred Taketo Aoyama, vice president and assistant manager
• Fred Y. Yamagishi, secretary
• Y. Yamagishi (a younger relative of Fred Y.), manager

(Furuta lived in California, but the others were Northern Nevada residents.)

Immediately, Reno Club, Inc. was successful. It was the only tango salon in town until Bill Harrah came on the scene in 1937. His first Reno tango enterprise was on Center Street, outside of the city’s gambling core, and, thus, Harrah closed it after only a few months. His next, which he called Plaza Tango, was on Commercial Row. In March 1940, he added a second tango enterprise, next door to Reno Club, Inc., at 242 N. Virginia Street.

Beginning of the End

Once the U.S. declared war on Japan, on December 8, 1941, all people of Japanese descent living in the States were considered the enemy and treated as such. The owners of Reno Club, Inc. were no exception. For starters, the U.S. federal government impounded their money, leaving them with no capital with which to operate their gambling business.

Also, Furuta was interned in the Poston War Relocation Authority concentration camp in southwestern Arizona, close to the California border and near the town of Parker.  

The elder Yamagishi was arrested but released on parole, according to a newspaper article.

Aoyama was drafted but not called to serve.  

Given their tenuous financial position and alien status, Reno Club, Inc.’s proprietors asked Harrah if he wanted to acquire their enterprise. He offered to pay $20,000 ($337,000 today) for it. About a week later, when the owners told Harrah they agreed to the deal, he indicated the offer price no longer stood and now was $12,500 ($210,000 today), they reported. Consequently, they refused to sell to him.

May 1942

Instead, they renegotiated their lease agreement on their club’s building, with the owner, Frank Quinn of Young Investment Co.

The document outlined that Harrah could lease the premises for $350 (about $5,900 today) a month for a year, and if the war wasn’t over by that point, the lease would revert to month by month. It would remain in effect “until the general treaty of peace has been concluded between the Axis Nations on the one part and the United Nations on the other part” or until October 26, 1948, whichever came first (Nevada State Journal, July 16, 1947).

Right away, Harrah assumed the space and advertised another bingo club.

September 1945

When the war ended for the U.S. on September 1, 1945, the Reno Club, Inc. owners — now Fred and Y. Yamagishi and Fred Aoyama — sought to get back their gambling establishment. However, Harrah refused to vacate the premises, saying he didn’t have to until a peace treaty was signed between Japan and the States. (Typically, peace treaties aren’t signed until seven or more years after hostilities end, and until such a treaty is in place, those considered enemy aliens during the war technically retained that status.)

Instead of fighting for the return of their business, Aoyama and the Yamagishis sold it to the O’Keefes: James L., Charles P. and Lottie M. But they couldn’t operate it either because Harrah wouldn’t vacate it.

Another War, This One In Court

What followed was a five-year-long legal battle between the O’Keefes and Young Investment Co. and/or Harrah.

September 1946

To get Harrah out of their Reno Club, Inc., the O’Keefes sued the landlord Young Investment Co. The O’Keefes claimed Harrah had no right to occupy the premises now that the war was over. Young Investment, on the other hand, asserted that, according to the lease, Harrah was entitled to stay there until a peace treaty was effected or the lease ended in October 1948.

Later in September, Judge William McKnight of the district court ruled against the O’Keefes, and Harrah stayed put. The O’Keefes appealed.

July 1947

Next, the Nevada Supreme Court heard the case. The judges reversed the decision and returned the case to the lower court to be tried again.

September 1947

At the second trial in district court, Judge Frank McNamee of Las Vegas presided. Also, Harrah was a defendant alongside Young Investment.

February 1948

McNamee ruled differently than McKnight had and ordered Harrah to clear out of Reno Club, Inc.’s premises. But Harrah didn’t. Instead, he appealed to the state supreme court.

October 1948

Before the case was even presented to the supreme court judges, October 26 came around, thereby terminating the lease on 232 N. Virginia St. The gambler moved out of Reno Club, Inc. that day. The next month, the O’Keefes reopened Reno Club Inc. (and eliminated the comma from the name).

The Nevada Supreme Court upheld McNamee’s 1948 ruling.

The Exclamation Point

May 1952

The O’Keefes again sued Harrah, this time seeking damages for the four months between June 15, 1946 and October 26, 1946, during which, according to the lawsuit, he’d illegally occupied Reno Club, Inc. This period was before the initial district court ruling in the O’Keefes versus Young Investment case. The O’Keefes asked for $133,632 (about $1.4 million today). The amount consisted of rent, at $100 ($1,000 today) a day, and $43,300 ($448,000 today) for use of the gambling business’ personal property.

Judge A.J. Maestretti determined the O’Keefes weren’t entitled to damages for any period before McNamee’s February 1948 ruling but were for the six months after that. Consequently, Maestretti awarded them $8,155 ($84,400 today) for rent, at $105 per day.

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What do you think? Should Bill Harrah have vacated the Reno Club, Inc. premises when the war between the U.S. and Japan ended or not?

Sources

As Mark Estes, 28, played blackjack at a table in Nevada’s Las Vegas Hilton casino one day, he counted the cards. This involved remembering the cards dealt during each game and using a mathematical formula to calculate the odds of success of betting on any given hand.

Suddenly, the University of Nevada, Las Vegas grad student found himself in a back room on the property, being told he’d “wind up in the desert with a hole in his head” if he was caught counting cards again at the Hilton, Estes alleged. Because he refused to leave the casino after this threat, the staff had him arrested for trespassing.

Card counting was legal then, and Nevada gambling authorities didn’t regulate it. House rules of many of the state’s casinos disallowed the practice, and these enterprises could and did eject card counters and take other actions, like extra card shuffling, to impede their efforts.

Right To Play Cards

Estes, with help from the American Civil Liberties Union sued the Hilton, the Nevada Gaming Commission (NGC), the Nevada Gaming Control Board and the Las Vegas Police Department to try to stop Nevada casinos from refusing to play card games with card counters.

Estes’ complaint asserted the following:

• Card counters had to the right to play cards in a casino in any way they wanted.
• The state of Nevada was obligated to protect card counters.
• Nevada was encouraging unlawful conduct by allowing casinos to throw out card counters.
• Casinos can’t just let people most likely lose play cards in their establishments.

In his suit, Estes asked the court to declare illegal the existing gambling regulation that requires casinos to ban people whom the state deems to be “inimical to the interests of the State of Nevada, or of licensed gambling, or of both,” reported the Las Vegas Sun (Jan. 21, 1977).

“The case, expected to be a landmark for the NV gaming industry, will test the practice of card counting and whether casinos are in their rights when they eject a counter,” wrote the Reno Evening Gazette (Aug. 19, 1977).

Persisting In The Cause

After Hilton Casinos Inc. and the NGC asked the court to dismiss Estes’ case, Judge Joseph Pavlikowski did just that. Based on a previous ruling by the Ninth Circuit Court of Appeals, he determined that nobody has a constitutional right to play cards.

Estes appealed, and two years later, the Nevada Supreme Court heard arguments in the case. Estes’ attorney asserted that blackjack/21 is a game of chance, and players who have a chance of beating the house can’t be banned. Card counters are simply using their intelligence, he said, and casinos can’t kick out better players.

Hilton Casinos’ attorney countered that casinos’ right to ban certain players is a private business decision, one that Nevada gaming regulators recognize.

Ultimately, the high court jurists ruled in the Hilton and, thus, all Nevada casinos’ favor.

Battle Buddies

Before Estes took up the sword, another card counter, Kenneth “Ken” S. Uston, had launched the battle in 1976, when he’d sued Las Vegas’ Flamingo, MGM Grand and Marina Hotel and Casino for $14 million for what he’d claimed was “illegally” prohibiting him from playing cards at their establishments. This suit differed from Estes’ in that it didn’t allege state wrongdoing.

In federal court in 1978, U.S. District Judge Roger Foley decided Uston’s case. Foley ruled that Nevada casinos may disallow card counters from playing cards in their gambling house.

Over the years, Uston filed several lawsuits related to Nevada casinos’ treatment of card counters, but he lost them all.

For Ben Affleck and all other card counters, present and future, these two Davids, Estes and Uston, fought the Goliath of Nevada casinos, but unlike in the Biblical story, they didn’t prevail.

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Do any of you count cards? If so, how much of an advantage would you say it gives you?

Illustration from Pond5.com

Sources

The couple’s harrowing experience started at their Las Vegas home.

Two men disguised with faux facial hair and odd outfits nabbed First National Bank of Nevada executive Reno N. Fruzza as he entered his garage at about 9 p.m. on Monday, May 23, 1977. They held him, 56, and his wife Polly, 50, captive there, overnight, at gunpoint.

Reno had worked for the financial institution for 36-plus years. Polly had had a career as a Western comedy star named Polly Possum in the 1950s and ’60s. The two were active in the community, avid fishermen and big art and antiques collectors.

The next morning, the kidnappers injected the Fruzzos with a poison requiring an antidote to stave off death, they told the couple. They instructed Reno to retrieve $1.22 million dollars from his bank’s vault and then follow directions he’d receive in notes left for him in various places. Otherwise, they’d withhold the antidote from Polly, and she’d die.

Elusive Money Swap

Reno obtained the cash and while doing so, told some bank employees what was happening. Per the typewritten note in his 1963 Cadillac’s glove compartment, he then went to the phone booth outside the Knight’s Inn. Meanwhile, his co-workers had notified the police who’d caught up to and started following Reno but allegedly lost him in traffic.

The next note told him to go into room 125 of the Sahara hotel-casino. There, in an ashtray was another instruction, to find and use the 1964 beige Cadillac sedan in the parking lot to follow spray paint marks on the road. Subsequently, various notes and Polaroid photos led Reno through numerous small rural towns, including Goodsprings, Sloan, Jean and Sandy Valley, and finally to the Calvada Inn in Pahrump, about 60 miles from Vegas. He arrived there at about 1 p.m., and was to stay in its Pony Express Bar until further notice.

While he was there, the perpetrators removed the money from the Cadillac’s trunk. They transferred it to a yellow Cessna 172 (which had false identifying numbers on it) and flew from Pahrump to the North Las Vegas Air Terminal, where they got in waiting cars and left. They phoned Reno at about 3 p.m., thanked him for his cooperation and said he was free to go. The freed captive immediately called police, who subsequently found Polly handcuffed to a bed post in Las Vegas’ Showboat hotel-casino.

Neither Polly nor Reno had been hurt, and the supposed poison they’d been injected with had been a hoax, requiring no lifesaving remedy.

Suspects Identified

FBI agents on the case determined the two culprits were Paul Michael Kodelja, a 30-year-old craps dealer at Circus Circus in Las Vegas and previously Harrah’s in Reno, and 50-year-old Craig Otte. Kodelja was a licensed pilot with no criminal background. Otte, however, had a record including burglary, larceny and other petty crimes. Most recently, though, he allegedly had robbed a Los Angeles bank of $40,000 in 1975, charges for which were pending against him in 1977.

For Otte and Kodelja’s criminal scheme, the federal government charged them with conspiracy, stealing bank money, assault with dangerous weapons and kidnapping.

Accountability On Horizon

The younger of the two turned himself in 10 days after the crimes and after his attorney Oscar Goodman negotiated his surrender. Kodelja posted $150,000 in bail and was released from the Clark County Jail. After pleading innocent to the charges, he turned to the Nevada Supreme Court for dismissal of the counts against him on the grounds that the grand jury indictment contained ambiguous language and other technical problems.

Kodelja, however, lost that appeal in November 1977. A trial date was set for January 4, 1978.

As for Otte, he’d disappeared. The stolen $1.22 million had, too.

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The story concludes in next week’s post, Casino Dealer, Accomplice Execute Elaborate Crime in Las Vegas, Part II.

Sources

While being plied with endless, free whisky highballs,* Hamilton Buck played roulette for hours at the Texas gambling-saloon** in Goldfield, Nevada. Then, in 1908, the northwestern mining town was nearing the end of its heyday (1904-1908) that had made it the state’s largest metropolis.

With Charles Green, a brother of one of the establishment’s proprietors comprising J.E. Burke & Co., operating the wheel, Buck had varied luck for a while. Ultimately, though, he found himself $1,000 (more than $26,000 today) in the hole.

He gave Green a $500 certificate of deposit (COD) he’d gotten from the local John S. Cook & Co. bank, and Green exchanged it for gold coins. With those, Buck continued to gamble at roulette. At first he won about $700 to $800 but eventually lost most or all of the $500. An intoxicated Buck left the establishment.

The next morning, he instructed the bank to cancel payment on the COD because Burke & Co. weren’t entitled to it legally. In response, Burke & Co. sued Buck and won; Cook & Co. had to make good on the COD. Dissatisfied with the outcome, Buck appealed, and J.E. Burke & Co. vs. Hamilton Buck went to the state’s high court.

James G. Sweeney

Significant Ruling

In January 1909, the Nevada Supreme Court reversed the Esmeralda County district court’s ruling and mandated that the saloon reimburse Buck the $500. The basis for the decision, Justice James G. Sweeney wrote in the opinion, was the Statute of 9 Anne, part of the revised English common law that became the basis of Nevada law upon statehood in 1864.

Based on the belief that gambling was against the public’s interest, the statute read: “… all notes, bills, bonds … given … by any person or persons whatsoever, where the hole or any part of the consideration … shall be for any money or other valuable thing whatsoever, won by gaming, … shall be utterly void, frustrate, and of none effect, to all intents and purposes, whatsoever, etc.“

Sweeney clarified that money won at a public gaming table is not recoverable by action in Nevada. He also noted that the statute stands regardless of whether gambling is considered by state law to be legal or illegal. (Later that year, the Nevada Legislature abolished gambling.)

Burke v. Buck was one of the earliest Silver State cases challenging the statute.

The Flip Side, Player v. Casino

In July 1958, the Nevada Supreme Court weighed in on the reverse, whether players may sue gambling clubs for alleged unpaid winnings. This came about through the lawsuit of Jack Weisbrod against the Fremont in Las Vegas. He claimed the casino refused to pay him the $12,500 ($111,000 today) he believed he’d won from playing keno.

The district judge rejected Weisbrod’s suit, and the high court jurists affirmed the ruling. They wrote that “if money won at gambling is not recoverable through resort to the courts, it is not because of who has won it but because of the nature of the transaction itself.”

They noted, too, that players have recourse through the state’s gambling regulators who will intervene on their behalf, if warranted.

A Long Stretch

Statute of 9 Anne endured in Nevada for 119 years despite several legal tests of it and attempts to have it reversed.

Casino owners in the state again lobbied for the latter in 1982 because of their “staggering money losses,” about $117 million ($311 billion today) that year for instance, and because their Atlantic City, New Jersey competitors could collect on markers, the Reno Gazette-Journal reported (Dec. 17, 1982).

When the legislature was in session the following year, it passed Senate Bill 335 allowing gambling establishments to pursue in the courts the monies owed to them.

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* A whisky highball at the Texas consisted of Scotch whisky and mineral water.

** The Texas burned down in 1914.

Photo from freeimages.com: “Money Series 6” by mokra

Sources

Sheriff E. Russell Trathen

1931

In April 1931, the month after the new, liberal gambling law went into effect (March 19), Washoe County Sheriff E. Russell Trathen, per his job description, collected $20,000 (about $330,000 today) in gambling license fees for the month of April from operators in Northern Nevada.

Seeking Piece Of The Pie

First, Trathen went to the Washoe County Commission (WCC) and demanded 6 percent of the total in commission, which amounted to about $720 ($11,800 today). He argued he was entitled to it based on the state’s license tax act of 1915, which afforded sheriffs a 6 percent cut of the proceeds of all business licenses (and 20% of grazing licenses) sold.

The commissioners sought a legal opinion from District Attorney Melvin Jepson, who advised them that according to the law, Trathen wasn’t owed or due any compensation for the collection of license fees. The WCC told the sheriff no.

Next Course Of Action

Trathen then retained Attorney Lester D. Summerfield. In early May, the two filed for a writ of mandamus, which is an order from a superior court to a lower court, government entity, corporation or public entity to take or not take an action, as required by law. Summerfield/Trathen asked the Nevada Supreme Court to order the county treasurer to  accept the license fees Trathen had collected minus 6 percent becuase the treasurer had refused to do so the prior month, April. (Another mandamus action related to the new gambling law was taken earlier in the month in Las Vegas.)

“The case attracted wide interest through the state, as sheriffs of other counties might be able to collect a commission on gambling licenses” the Reno Evening Gazette noted (July 8, 1931).

Not Like The Others

On July 8, 1931, the higher court dismissed the writ of mandamus and issued its ruling, which was unanimous: Nevada sheriffs aren’t authorized to retain any part of the gambling license fees they collect. They said the 1931 gambling act, unlike the 1915 law, lacked a provision for such a commission.

What the new legislation did spell out was that sheriffs were responsible for unpaid fees; they were “held liable on [their] official bond for all moneys due for such licenses remaining uncollected by reason of [their] negligence,” reported the Nevada State Journal (July 9, 1931).

Sources

Photo from Police Motor Units

Rooms at this hotel-casino were $10 a night, and the golf course was lit during the dark hours.

1958-1961

The Hacienda in Las Vegas, Nevada held an ongoing promotional contest at its golf course, which was widely advertised, even on the back of the postcard above. Participants would pay 50 cents (about $4.25 today) per attempt at a hole-in-one from 165 yards away, and the casino would award $5,000 ($43,000 today) to anyone who accomplished it.

Beating The Odds

The chance of someone making a golf ace depends on their skill and the difficulty of the hole, according to the National Hole in One Association. Roughly speaking, though, these are the odds for achieving such a feat for players of different skill levels:

Professional Golfer:        2,500 to 1
Lower Handicapper:       5,000 to 1
Amateur Golfer:             12,500 to 1

On Wednesday, March 12, 1958, with an entourage present, George Gibson, a local resident and commercial pilot, paid the entry fee and allegedly landed an ace. Yet the Hacienda, 1.5 years old at the time, didn’t give him the prize.

Gibson sued.

Chance v. Skill

At the trial, the Hacienda defense argued and cited state law to support that gambling debts weren’t collectible in Nevada courts and, therefore, the casino wasn’t liable for the $5,000. (It was true that individuals or companies owed, whether a casino or a player, couldn’t use the legal system to recoup such monies.)

In response, the plaintiff’s representation conversely purported that the $5,000 didn’t constitute a gambling debt. This was because what Gibson had participated in hadn’t been a game of chance but, rather, a game of skill. A golf professional testified on Gibson’s behalf that yes, luck was involved in making a hole-in-one, but “a skilled player will get (the ball) in the area where luck will take over more often than an unskilled player [will]” (Nevada State Journal, Feb. 2, 1961).

District Judge A.S. Henderson ruled the Hacienda had to pay Gibson. He determined the hole-in-one contest was in fact a game of skill and as such, the money owed to Gibson wasn’t gambling related.

The casino appealed that verdict, and the Nevada Supreme Court heard the case three years later, in February 1961. That body affirmed the lower court’s ruling and ordered the Hacienda to pay Gibson the $5,000 plus interest and court costs.

Change Of Tune

When the Associated Press reported the outcome of the appeal, the Hacienda’s general manager gave its newsperson a different reason for having not paid Gibson, that his company couldn’t verify the contestant landed an ace.

“The hole in one was made under odd circumstances,” said Norman Yoshpa. “It wasn’t witnessed by an authorized person” (Arizona Republic, Feb. 5, 1961).

Yospha explained that a hotel gift shop employee was supposed to have watched Gibson try for the win, but she got called to the phone just as he was about to swing. She told him to wait then left for the building. Yet when she returned to the green, he claimed he’d made the shot.

What had really happened? Had Gibson made the hole-in-one or had he fabricated that he had? Or had the Hacienda planned all along to not pay any winners? Or had extenuating circumstances in Gibson’s case, as suggested by Yoshpa, been the true reason for the company withholding the five grand? What do you think?

Sources