Stephen Crosby, Chairman of the state gaming commission, discusses the proposed Mohegan Sun casino at Suffolk Downs in Revere during a meeting at the Boston Convention Center.
From http://bostonherald.com/business/business_markets/2013/12/caesars_sues_massachusetts_gaming_commission_chairman
Las Vegas casino company Caesars, which once planned to develop a casino at Suffolk Downs but was dropped by the racetrack after the state Gaming Commission flagged what is said was a Caesars investor’s apparent ties to organized crime, has sued commission chairman Stephen Crosby for “tortious interference” with the company’s contractual right to a fair consideration for a gaming license.
“The Commission’s staff issued an incorrect and unprecedented recommendation that Plaintiffs had not met their burden to establish their suitability, and Chairman Crosby and members of the Commission’s staff have made untrue and misleading statements about Plaintiffs and their affiliates,” reads the suit, filed yesterday in federal court. “This caused and continues to cause Plaintiffs to suffer reputational and economic injury.”
The suit states that unnamed officials from the company the Gaming Commission contracts to screen license applicants, Spectrum Gaming Group, in fact recommended Caesars be found suitable to open in Massachusetts, contradicting what the company says it was told by Karen Wells, director of the commission’s investigative bureau.
“After Plaintiffs had withdrawn from the application process and after the votes in East Boston and Revere, Plaintiffs learned that Spectrum had in fact recommended that Plaintiffs be found suitable,” the suit reads. “The statements from these Spectrum officials were contrary to Plaintiffs’ previous understanding, gained from communications with Wells, as to the nature of Spectrum’s suitability recommendation to the Bureau.”
Caesars argues in the suit that there is no evidence to support reports that linked Caesars investor Gansevoort Principal to Russian organized crime figures, and that the company was willing to restructure its relationship with Gansevoort to satisfy the commission — an offer, it said, which fell on deaf ears.
The suit calls the concerns of commission investigators “alleged and shifting,” and claims that different suitability standards applied to the Wynn Resorts proposal in Everett and the MGM Resort in Springfield.
“Our legal staff is currently reviewing the information and we will issue a statement later today once they have had the opportunity to complete an initial review,” said Elaine Driscoll, a spokeswoman for the commission.
The suit says Crosby at an October hearing “baselessly impugned the integrity and competence of Caesars’ Compliance Committee by stating that in order to ‘protect against slipping’ standards, it is important to ‘empower’ people who are willing to ‘say the unpopular thing,’ and implying that Caesars’ Compliance Committee lacks such individuals.”
The suit also says the review Caesars underwent was tainted because of Chairman Crosby’s late public disclosure of business ties to an owner of the land Wynn wants to build on in Everett.
Caesars asks a judge to order Crosby to pay damages after a trial, deem the commission’s suitability process “constitutionally flawed” as it was applied to Caesars, and enter an injunction prohibiting Crosby from relying on his investigators’ report.
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