Larry Flynt Scores Victory In Gambling Lawsuit

By Ben Hamill - January 19 2021

Larry Flynt Scores Victory In Gambling Lawsuit

Porn king and Hustler magazine founder Larry Flynt on Thursday scored a minor victory over the state of California in his bid to have an archaic law overturned. Flynt, who owns two major California card rooms, the Hustler Casino and Lady Luck Casino,  along with two co-plaintiffs, sued the state in 2016, arguing the law that prohibits local gaming licensees from owning shares and/or business interests in casinos located outside of the state, to be unconstitutional and outdated.

Flynt and co-plaintiffs Haig Kelegian Sr and Haig Kelegian Jr decided to sue the state after Kelegian Jr got slapped with a $210,000 fine after it emerged that a company part-owned by his wife had acquired a Seattle gambling establishment. The Kelegian family have owned several casinos and gaming establishments at various points in time, including Ocean’s Eleven and the famous Bicycle Casino.

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Mendez Considers Constitution

US District Judge John Mendez in his ruling sided with Flynt and his co-plaintiffs regarding the possibility of the statute being in violation of the commerce clause of the US Constitution. Initially enacted in 1986, the statute prohibiting out-of-state casino ownership was enforced in an attempt to eradicate organised crime within the local gaming industry.

Flynt and co. argue that even though the law may have been necessary at the time, given the fact that the mob hasn’t had an influence on casino ownership in Las Vegas, or anywhere else, for literally decades, it has become obsolete, outdated, and due for review.

The plaintiffs furthermore contend that in its current format, the law inhibits California-based US citizens from investing in and making the most of potentially profitable commercial opportunities in the gaming industry solely because of those opportunities existing out-of-state.

Law Burdens Interstate Commerce

In his ruling and dismissal of the state’s application to have the Flynt lawsuit dismissed, Judge Mendez entertained the idea that the statute places an undue burden interstate commerce. Mendez also pointed out that according to the US Constitution, should any statute seek to regulate or discriminate against out-of-state interests by favouring over those interests in-state economic benefits and/or interests, then such a statute should be struck down without the need for further inquiry.

Flynt as part of his argument said that the effects of such a statute are severely limiting to business partnerships. He said the law meant that if any of his business partners chose to invest in a gaming business, he would automatically be forced to divest his own business interests and ownership in a Nevada strip club.

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