Reuters 11-18-2015

U.S Judge Orders Settlement Talks For Illinois Lottery Dispute

November 11, 2015
By Karen Pierog

CHICAGO Nov 18 (Reuters) – A U.S. District Court judge on Wednesday sent parties in a lawsuit against the Illinois Lottery by unpaid lottery winners into settlement talks while the case continues.
Chief Judge Ruben Castillo said he will refer the case on an expedited basis to Magistrate Judge Mary Rowland, who will oversee the discussions.

Illinois has not been paying lottery winners of $600 or more since October, due to a state budget impasse between the Republican governor and the Democratic-controlled legislature. The state has continued to advertise games, sell tickets and hold lottery drawings.

The political stalemate has left the state without a budget for the fiscal year that began on July 1. Illinois had initially stopped paying winners of $25,000 or more in September.

Thomas Zimmerman, an attorney who filed the class action in September, told the judge on Wednesday that a previous effort on his part to have the lottery set aside unpaid winnings “essentially hit a brick wall.”

A state official told the court there is no need to set the money aside. “The money is there,” said Thomas Ioppolo, an assistant Illinois attorney general. “The only thing that is lacking is the authority to release it and that’s what the budget impasse is all about.”

The judge set a briefing schedule that culminates with a Dec. 16 hearing. The case expanded earlier this month to include dozens of state lotteries participating in the Mega Millions and Powerball games. The amended lawsuit also included a motion to stop the other state lotteries from sending Illinois its share of multi-state lottery winnings.

So far, seven of the new state lottery defendants have asked the court not to grant the motion.

Ioppolo said the lottery winners are barred from suing Illinois under the Eleventh Amendment to the U.S. Constitution, which prohibits states from being sued in federal court by their residents. But Zimmerman said the lawsuit is permitted because the lottery fund is not part of Illinois’ general fund.

Legislation allowing lottery winners to be paid passed the Illinois House last week but has not been sent to the Senate. (Editing by Matthew Lewis)