Catskill Development Sues Park Place for More Than $6 Bil

WHITE PLAINS-Catskill Development and its partners in what is now the failed effort to build a Native American casino at the Monticello Raceway, filed suit on Nov. 13 in US District Court in White Plains against Park Place Entertainment Corp., seeking $6.3 billion in damages.

The suit charges that Park Place induced officials with the St. Regis Mohawk Indian tribe to terminate its contractual agreement with Catskill Development to build and manage a $500 million casino at Monticello Raceway. Officials representing Park Place say that they have yet to see the lawsuit and therefore have no comment on the charges.

In addition to Catskill Development, also listed as plaintiffs are Mohawk Management LLC and Monticello Raceway Development Company LLC. Alpha Hospitality, a publicly traded gaming company, has ownership interest in all three entities, according to Alpha Hospitality executive vice president Thomas Aro.

Catskill Development, which is represented in the court action by noted attorney Thomas Puccio, states in its suit that shortly after the Bureau of Indian Affairs approved its application to build a casino at the Monticello Raceway site on April 6, 2000, Park Place officials lured the St. Regis Mohawks away from the project.

“Because the casino project would be much closer to the metropolitan New York market than Park Place’s three Atlantic City casinos, Park Place intentionally interfered with plaintiff’s ability to complete the Casino project,” Catskill Development charges in court papers. “On information and belief, Park Place, on April 14, 2000 induced government officials of the Mohawks to execute a ‘secret’ agreement without using their usual regulatory counsel or providing notice of the agreement to other tribal members.”

Catskill Development further alleges that Park Place indemnified the Mohawks against any litigation and advanced the tribe $3 million. As a result of the actions by Park Place, the St. Regis Mohwaks terminated all business with Catskill Development and its partners on April 14, shortly before New York Governor George Pataki was expected to grant state approvals for the project to proceed.

Less than a month later, Park Place announced its plans to build a hotel/casino at Kutsher’s Country Club in partnership with the St. Regis Mohwaks. However, Park Place has not yet filed an application with the US Bureau of Indian Affairs to approve the project.

Alpha Hospitality’s Aro confirmed that Catskill Development is attempting to partner with another Indian tribe to develop a casino at the Monticello Raceway site. However, he would not provide any details on what Indian tribe the company is in discussions with. In its suit, Catskill Development charges that Park Place, by derailing the Monticello Raceway casino accomplished a great deal, with or without its deal to build a gaming venue at Kutsher’s.

“Park Place carried out its scheme with impunity and arrogance,” Catskill Development charges in its lawsuit, “comfortable in the knowledge that it was in a no lose position: it either accomplished its original intention of eliminating competition to its Atlantic City casinos; or it would steal the rights to develop and manage what would become the most profitable casino in the world as a part of a greater scheme to monopolize the casino gaming business in New York through its exclusive relationship with the Mohwaks.”

Catskil Development alleges that several Park Place chief executives were heavily involved in convincing the St. Regis Mohawks to terminate its deal at Monticello Raceway, including former Park Place CEO Arthur Goldberg, who passed away last month.

Although not named as a defendant in the case, New York City developer and casino owner Donald Trump was cited as another key player in attempting to thwart the approval of Native American casinos in Sullivan County. The lawsuit notes that Trump and other participants involved in a group called the “New York Institute for Law & Society” were recently fined a total of $250,000 for illegal lobbying activities.