Man who spent $40,000 on lottery sues to get money back
Saturday, January 06, 2007 posted 03:13 AM EST
Two men filed a lawsuit Friday against the Hoosier Lottery, seeking class-action status as a result of the lottery's admitted misrepresentation of the number and amount of prizes available in a scratch-off game.
Jeff Frazer, Carmel, and Jeff Koehlinger, Auburn, seek reimbursement in the lawsuit filed in Marion County for the losses they incurred when playing the scratch-off game "Cash Blast."
Frazer purchased $40,000 of the $10 tickets and Koehlinger $2,470.
The game promised seven grand prizes of $250,000 each, plus several lesser prizes of up to $10,000 each.
But in July, after selling 5 million tickets, the lottery abruptly reduced the number and amount of prizes in the course of two weeks, according to the lawsuit, which was assigned to Marion Circuit Court.
"It was because the prizes never existed," said Richard Waples, Indianapolis, the plaintiffs' attorney.
"About 60,000 prizes weren't available that people were buying these tickets for," Waples said. "They said, 'Oops, sorry.' "
The Hoosier Lottery has admitted to overstating cash prizes in a statement on its Web site.
The lottery attributes the problem to a mistake in printing by the lottery's scratch-off vendor that affected up to 2.5 million tickets, which amounted to about $25 million spent on the potentially defective tickets.
However, the lottery maintains that the odds of winning were not compromised.
The lottery's new director, Kathryn Densborn, of Indianapolis, had no comment late Friday on the lawsuit.
She identified an attorney in the Indiana attorney general's office who is representing the lottery in the case. The attorney could not be reached for comment.
The lawsuit claims the lottery overstated the number and amount of prizes in the Cash Blast game by as much as $8 million from May 2005 to July 2006.
Frazer and Koehlinger complain that the lottery's advertising misled them into thinking the odds were on their side at the time they bought the scratch-off tickets.
"As the game wrapped up, the last 10 to 20 percent of the tickets being left, virtually all the prizes were still available," Frazer, 51, a real estate contractor, said Friday.
"And that's where a lottery becomes an investment. When you know every couple of tickets is going to be a nice winner, that's when you play hard," he said.
He said he doesn't often play lottery games. When he does, he said, he focuses on those with many prizes and few tickets remaining, winning several thousand dollars that way.
"That's the way that you play the lottery when you know you can't lose," he said.
This time he lost. Confused and suspicious that there may have been a problem with the tickets, he and Koehlinger separately contacted the lottery repeatedly by phone and e-mail about their concerns, but they say they were ignored.
When the problem with the ticket printing was discovered, both men received apologies from the lottery by e-mail, but the lottery refused to refund the money they spent on tickets.
Both men say lottery officials told them that despite the defective tickets, the losses could've been coincidence. The two men weren't convinced and contacted Waples, who fought and won a case last year against Hoosier Lottery regarding a man whose winnings were not paid when he presented his ticket.
The men want a court to order the lottery to refund money to anyplayer affected by the problems in the scratch-off game and award any other appropriate compensation and attorney fees.
Frazer said he wonders, "If they did it with this game, how do we know they don't do it in other games? It's come down to a situation where, if they didn't know, they should've known."
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