Maryland casino developer hits racetracks with $600m defamation suit

By Liz Farmer
Examiner Staff Writer

(To see story published in The Washington Examiner, click here)

The developer of Maryland’s largest casino is waging another battle against the state’s racetrack operators that fought to stop his development -- this time with a $600 million lawsuit filed in Baltimore Tuesday.

Baltimore-based Cordish Companies and two of its gaming subsidiaries say the owners of Laurel and Pimlico racetracks, the Maryland Jockey Club and others conspired against the developer to kill its planned casino near the Arundel Mills mall, costing Cordish millions in legal fees and damage to its reputation.

In a 43-page complaint, Cordish levels charges of conspiracy, defamation and tortious interference, saying that jockey club and track owners Penn National Gaming and MI Developments conspired in “an illicit campaign to destroy PPE of Maryland,” the Cordish subsidiary that broke ground on the Arundel Mills casino this month.

Among the charges, the complaint alleges Cordish opponents -- who want a casino at their own Laurel Park -- misrepresented a contract dispute between a casino it operated in Indiana and that casino’s owner.

In Indiana, Cordish says its subsidiary PPE Indiana is owed more than $8 million in operating fees by the track owner. Tuesday’s complaint says Indiana Downs Chairman Ross Mangano used that dispute “to create false and unfavorable publicity for Cordish” during last fall’s referendum in Anne Arundel County, where voters were charged with approving zoning for Cordish’s proposed casino.

In the complaint, Cordish cites a commercial opponents ran last fall calling the Indiana casino “a financial disaster” and adds “voters can’t trust The Cordish Company to deliver.”

Mangano “worked with Penn National, MJC, MID and [MID Chairman Frank] Stronach ... to coerce PPE Indiana into relinquishing its right to the Management Fee and to defeat Cordish in the referendum vote,” the complaint said.

A spokesman for Penn National said the company doesn’t comment on pending litigation. However Tom Chuckas, jockey club president, called the suit an effort to restrict free speech.

“As to the Cordish Companies’ business in Indiana, we have no idea what they are talking about,” he added.
Tuesday’s suit, in which 10 defendants are named and eight counts are listed, is the latest filing in what has been a highly litigious and embittered battle between Cordish and Maryland’s racetrack interests.

Since the jockey club’s competing slots bid was thrown out in February 2009 for not paying the $28.5 million license fee, Cordish’s casino has been delayed by a slow-acting county council, a petition effort to fight the council’s zoning award, a court battle over that petition’s legality and the November 2010 referendum that approved zoning. This week, the $1 billion casino’s construction was halted in response to an appeal over the site’s traffic planning.

Much of those efforts were funded by jockey club owners. Penn National, which bought a 49 percent stake in Maryland’s tracks and the jockey club last summer, also operates Cecil County’s casino.

Sen. James DeGrange, D-Anne Arundel, is co-sponsoring legislation in Annapolis that seeks to squash such efforts by slots license holders.

“I think this would certainly keep license holders doing what they’re supposed to do, which is raise money for the state and not [spend so much time] in extensive litigations,” DeGrange said.