Judge dismisses suit

Wednesday, Jan. 30, 2002 | 11:02 a.m.

A federal judge in Las Vegas dismissed Harrah's Entertainment Inc.'s lawsuit against Penn National Gaming Inc. over the rights to operate a big gambling operation at a West Virginia racetrack.

Harrah's subsidiary Showboat Development sued Penn National of Wyomissing, Pa., in July. Harrah's claimed it and former partner Bryant Development Co. had agreed to develop a casino at the Charles Town, W.Va., track.

Harrah's complained Penn National stole its right to operate a casino at the track, a charge Penn denied.

There was also a dispute over whether the gambling center -- with its 1,500 slot machines -- is a "casino" under West Virginia law. Penn National said casino gambling is illegal in West Virginia and the slot parlor is not a casino.

This was important because Harrah's said it had an option to manage a casino at the track once legislation permitting casino gambling was approved in West Virginia. The state has not yet approved casino gambling.

"Showboat's exercise of its option to manage a casino at the race track was predicated on changes in West Virginia law by the West Virginia legislature," U.S. District Judge Roger Hunt ruled last week. "Because the subject of the agreements between Showboat and defendants was located in West Virginia and the option could not be exercised without changes in West Virginia law, the court finds that jurisdiction over defendants is not appropriate in the state of Nevada."