Indiana Supreme Court to Hear Case of Compulsive Gambler Who Says She Was Lured Into a Casino

Jenny Kephart admits that she's a pathological gambler who lost the $125,000 that an Indiana casino advanced her during one unlucky night at a blackjack table. But in a two-year court battle, she has argued that she doesn't owe the casino a dime because its employees should have denied such an addicted gambler access to the card table.

The Indiana Supreme Court is scheduled to decide next month if she has to repay the casino, with potential legal implications that could stretch far beyond the borders of Indiana.

On March 18, 2006, Kephart went to Ceasars Riverboat Casino, now the Horseshoe Southern Indiana casino, where she embarked on a gambling spree and, subsequently, lost $125,000 in credit provided by Caesars, according to court documents. That same night, Kephart had already lost at least $8,000 of her own money, according to her attorney.

Ceasars and Horseshoe are owned by the same corporation, Las Vegas-based Harrah's Entertainment.

The following year, when the casino sued her for failing to repay the $125,000, Kephart filed a countersuit, claiming she was a "pathological gambler" and that the casino knowingly "took advantage of her to enrich itself."

The case eventually ended up in the Indiana Court of Appeals, which ruled in favor of the casino in March, saying that Kephart's lost money was an "injury she chose to risk incurring."

Kephart's lawyer, who filed a petition to the Indiana Supreme Court, told ABCNews.com that he's pleased he'll get another chance to argue how he says the casino wronged his client.

"This casino intentionally, knowing she was a compulsive gambler, went after her to get her to gamble," said Kephart's attorney, Terry Noffsinger. "And, of course, the odds are in the favor of the house and she lost a lot of money."

Ceasars "was familiar" with his client because she had previously gambled at the chain's other location in Nebraska, Noffsinger said.

Upon moving to Tennessee in 2004, before which she had filed for bankruptcy because of her gambling habit, Kephart, now 54, received an inheritance of nearly $1 million after her father died, Noffsinger said.

Casino Preys on Compulsive Gamblers

It was then, he said, that Kephart was approached by Caesars.

"Caesars had dealings with her before and then she moves and guess who contacts who?" Noffsinger said. "They offered her a car [to take her to the casino], a free room and free drinks and then when she ran out of the several thousand dollars she had arrived with, they gave her $125,000 in credit."

Lawyers Gene Price and Steven Langdon, both of whom represent the casino in this case, did not return several messages left by ABCNews.com.

But, according to published reports at the time of the 2007 lawsuits, Price and Langdon argued in court that if Kephart was as addicted as she claimed to have been, she should have enrolled in the state's Voluntary Exclusion Program.

The program, developed by the Indiana Gaming Commission and similar to programs in a handful of other states where casinos or track betting exists, allows individuals with compulsive gambling problems to add themselves to a database that casinos crosscheck when they take identification from guests, primarily when they are cashing in on big wins or requesting credit.

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