Dismissed MGM Resorts Lawsuit Against Connecticut Upheld by Appeals Court

Posted on: June 22, 2017, 01:00h. 

Last updated on: June 22, 2017, 09:48h.

Casino.org Staff Writer Read More
Expertise: Commercial Gaming.

MGM Resorts was not placed at a competitive disadvantage in trying to build a casino in Connecticut on non-tribal land. That’s according to the 2nd US Circuit Court of Appeals in Manhattan, which upheld a state judge’s earlier dismissal of the case filed against Connecticut.

MGM Resorts Connecticut casino
Kevin Brown (left) and Rodney Butler (right), the two tribal leaders pushing to build a casino in East Windsor, are closer to realizing that goal after a lawsuit filed by MGM Resorts challenging the project’s legality was dismissed. (Image: CT Jobs Matter)

MGM, which is nearing completion on its $950 million casino resort in Springfield, Massachusetts, is trying to protect its regional gaming monopoly near the Massachusetts-Connecticut border.

To combat the expected flow north to the mega resort, Connecticut has granted its two tribal groups, the Mashantucket Pequot and Mohegan tribes, to jointly build a satellite gaming facility in East Windsor, 13 miles south of MGM Springfield.

The Las Vegas-based gaming conglomerate argued that if Connecticut wanted to expand gambling, it should do so in an open and competitive manner. The court ruled that MGM’s assertion is speculative.

“For a competitive harm to confer standing, there must be some actual competition underway that the ‘uneven playing field’ distorts,” the appeals court declared. “A purely abstract competition, based only on MGM’s expression of ‘interest’ and some preliminary studies, without any concrete steps toward a bid for a Connecticut casino, is insufficient.”

Quick Resolution

MGM Resorts suing Connecticut and its Governor Dannel Malloy (D) was seen by many as an attempt to delay construction of the satellite casino in East Windsor.

Originally planned to open in the fall of 2018, construction is ahead of schedule at MGM Springfield, and rumors are circulating that the resort could open as early as next summer.

MGM would love nothing more than to open its nearly $1 billion doors without a slots and table games competitor located less than a half-hour’s drive away.

Establishing gamblers and repeat patrons is a critical component of a casino resort’s early days. MGM Springfield will come with 125,000 square feet of gaming space, and 495 hotel rooms.

The appeals court’s upholding of the dismissed legal challenge brought by MGM means the two Native American tribes should be able to proceed quickly on building their $300 million satellite casino.

Next Steps

With the law on its side, the only thing remaining before the Mashantucket Pequot and Mohegans can break ground is a signature from Malloy.

The governor has received the approved legislation (Senate Bill 957) authorizing a non-tribal land casino from the joint partnership, but was waiting to endorse the measure until MGM’s legal challenge was resolved.

Malloy has previously expressed support for the satellite casino. In a statement, the Native American groups celebrated the appeals court ruling.

“Our focus remains on saving the thousands of jobs and millions in state tax revenue that would have been lost had the legislature not passed Senate Bill 957. We look forward to developing an exciting new casino and continuing to build our state’s economy in the weeks and months ahead,” the tribes explained.

Foxwoods and Mohegan Sun, Connecticut’s two casinos, deliver 25 percent of their slot revenue to Hartford. The state received $430 million in 2006, but amid gaming expansion in neighboring states, that number fell to just $268 million in 2015. The East Windsor casino will also share 25 percent of its slots take with the state.