PA Commonwealth Court Rules In Favor of Gaming Control Board And Denies Trump Effort To Get Foxwoods License

HARRISBURG: The Pennsylvania Commonwealth Court issued an opinion on Thursday which rejected claims by one of the losing applicants for a Philadelphia casino license that it had a right to intervene in Gaming Control Board proceedings relating to the Foxwoods casino project in that city.

In rejecting claims by Keystone Redevelopment Partners, led by investor Donald Trump and Trump Entertainment, Commonwealth Court thereby affirmatively recognized that the Gaming Control Board has the broad discretion over the licensing of casinos.

Keystone was one of five applicants for the two available Category 2 slot machine licenses in the City of Philadelphia in 2006. The Board, on December 20, 2006, awarded the licenses to HSP Sugarhouse and Philadelphia Entertainment and Development Partners/Foxwoods, while at the same time denying the applications of Keystone and two other applicants. Another applicant denied a license, Riverwalk Casino, appealed the matter to the Pennsylvania Supreme Court (see Riverwalk Casino v. PGCB, 592 Pa. 505, 926 A.2d 926 - 2007), Keystone Redevelopment Partners did not.

Nonetheless, Keystone petitioned the Board with a request to intervene more than two years after the Board’s initial decisions by attempting to interject itself in licensing matters relating to the Foxwoods project and that licensee’s request for an extension of time to commence operation of slot machines.

In addition, Keystone also filed a second petition to reopen the 2006 licensing proceedings and to revoke the license issued to Foxwoods asserting that it was now entitled to the slot machine license based upon the Board’s 2006 determination.

The Board denied Keystone’s requested relief and issued three separate orders, each of which held that Keystone lacked standing and other authority to seek or obtain the relief requested. Keystone then appealed each of the Board’s Orders to Commonwealth Court.

In its ruling, available on the Gaming Control Board’s web site at this link, the Court held that by not appealing the denial of its application more than two years ago, any interest that Keystone might otherwise have had ceased and its status as an applicant terminated. Moreover, the Court found that Keystone had mischaracterized the Board’s prior holding and that Keystone was not otherwise entitled to the license.

“The Commonwealth Court’s decision confirms what the Board has stated all along -- Keystone is just a disappointed applicant that lost in the competitive process for a license nearly four years ago,” said Gaming Control Board Chief Counsel Doug Sherman. “We hope that the matter is now settled and Keystone will not continue an effort to inhibit the development of gaming in Philadelphia and the creation of jobs and revenues which will flow from that process.”

In addition to the standing analysis, the Court affirmed that only the Board, upon recommendation from the Board’s Office of Enforcement Counsel (OEC) and the Board’s Bureau of Investigation and Enforcement (BIE), has the regulatory authority to revoke a license. It further noted that nothing in the Gaming Act or the Board’s Regulations authorizes Keystone to act as a prosecutor to revoke a license. Instead, the sole discretionary authority to bring enforcement actions is in OEC and BIE.

About the Pennsylvania Gaming Control Board
The Pennsylvania Gaming Control Board was established in 2004 with the passage of Act 71, also known as the Race Horse Development and Gaming Act. Pennsylvania’s first new state agency in nearly 40 years, the Gaming Control Board is tasked to oversee all aspects of the state’s casino industry. To date, with nine of a maximum fourteen casinos in operation, legalized gaming in the Commonwealth has created over 8,000 new living wage jobs, revenue that has provided property tax reduction in each of the past three years for all homeowners, funds that have reinvigorated Pennsylvania’s horse racing industry, and new revenue to local governments that has funded scores of community projects. A wealth of information about the Gaming Control Board and Pennsylvania’s gaming industry can be found at www.pgcb.state.pa.us. At this web site, visitors can view videos of Board meetings and the operation of the PGCB, obtain information on identifying a gambling problem and gaining assistance, look up future meeting schedules and past meeting transcripts, access an interactive map of casino locations, request a speaker for their group, along with much more information.

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