Illinois court overturns Emerald Casino decision

Maura Kelly

Wednesday, Dec. 31, 2003 | 11:29 a.m.

CHICAGO -- The Illinois Appellate Court ruled Tuesday that state law required gambling regulators to renew a license held by Emerald Casino, which had hoped to open in the Chicago suburb of Rosemont.

The impact of the decision was unclear as Emerald prepares to sell its license.

The ruling reverses a lower court decision that sided with the Illinois Gaming Board, which had denied Emerald's request to renew its license and relocate to Rosemont.

The court said that the intent behind a 1999 amendment passed by the Legislature was to resurrect the state's 10th license after nearly two years of inactivity to produce revenue for the state.

"We believe that when the Legislature chose to enact a statute that applied only to Emerald it thought it was providing a remedy for a moribund license, not creating yet another round of delay and rejection," the ruling said.

The decision comes as the bankrupt casino prepares to sell its license, which the Illinois Gaming Board has been trying to strip from Emerald since January 2001 because it said top Emerald officials lied to regulators and some investors had alleged ties to organized crime. Emerald denies the allegations.

It was unclear how much of an impact the ruling will have on the sale process, which is set to begin in January under the terms of a deal reached between Emerald and Illinois Attorney General Lisa Madigan.

Rosemont spokesman Gary Mack praised the ruling as a victory for Rosemont.

"As we understand it, what it means is that anybody who bids to buy Emerald's license -- and we don't care who that is -- they have got to bid Rosemont," Mack said. "Rosemont as a site was affirmed by the Appellate Court today."

But Barry Gross, chief deputy attorney general, disagreed.

"There is nothing in the ruling today that says the licensee has to be in Rosemont," he said. "The license will be auctioned to a new licensee to be approved by the Gaming Board into a community to be approved by the Gaming Board."

Emerald attorney James Sprayregen said he had not received the ruling to review.

"We are going to look at it and study it. Our intent remains to have the bankruptcy case resolved as soon as possible consistent with our prior agreements," he said.

Madigan spokeswoman Melissa Merz said the attorney general is studying the opinion before deciding whether to appeal, but has some concerns.

"Under the opinion's reasoning, the Legislature essentially stripped away the Gaming Board's discretion in renewing Emerald's license," she said.

Gaming Board spokesman Gene O'Shea said the board also is reviewing the opinion.

Emerald reached a settlement with the state in November that outlined how the license sale would be handled. The deal allows investors who are not accused of wrongdoing by the Gaming Board to get their money back from Emerald while the company's top officials forfeit $20.6 million.

A bankruptcy judge still must decide if Rosemont should be reimbursed $45 million for building a parking garage for the Emerald Casino.