Foxwoods-PGCB fight goes another round
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Jacoby and Pitre talk before the hearing
Foxwoods Casino told the Gaming Control Board Thursday they need equal footing in their years-long legal battle with the state.
Casino attorneys told the board that they have been denied the chance to interview board investigators and have been refused documents that they have requested in order to prepare for the fight to keep their license. Both the depositions and documents sought would, in part, provide information about other cases where the board was concerned with a casino’s progress, but did not revoke the license, attorney Fred Jacoby said.
The Foxwoods attorneys – Jacoby and Robert Graci – also pointed out that investigators for the board’s enforcement arm have had the opportunity to interview former PEDP executives.
These arguments and others made at Thursday’s hearing failed to persuade the PGCB, which denied a Foxwoods petition asking the board to overturn a decision that called for all discovery in the on-going license revocation case to be turned by tomorrow. Similar arguments were made in an earlier emergency petition.
But soon after the hearing, Foxwoods got more time. The board ordered that the director of hearings and appeals, Linda Lloyd, review the order she made that sets the existing discovery deadline. That happened just after the meeting, and Lloyd granted two more weeks. The Office of Enforcement Counsel – the entity that filed the petition to revoke Foxwoods’ license – isn’t finished with discovery, either.
Unrelated to the specific matter at hand but very much at the heart of assertions by the board that it is tired of Foxwoods’ delays – Jacoby noted that documents outlining an agreement with a new Foxwoods partner would likely be provided to the board soon. “I hope that we’ll have a term sheet to the board next week,” he said later.
Earlier in the Foxwoods saga, Las Vegas casino mogul Steve Wynn had signed similar documents with PEDP. He even provided the board with designs and site plans, and showed them to Philadelphia city leaders. But days later, Wynn withdrew unexpectedly. Recent media reports, citing unnamed sources, have said that Harrah’s Chester is the new entity that could save Foxwoods. Jacoby told reporters Thursday that he was “not in a position to comment. But you can talk to Harrah’s. They seem willing to talk to people publicly.”
After the hearing, Dale Miller, Deputy Chief Enforcement Counsel in the board’s Office of Investigations and Enforcement, said that nothing has been turned in yet, and revocation procedures are marching forward.
Even before the board went into executive session to mull over its decision, frustration with the amount of time Foxwoods has already had to get a casino operating at Columbus Ave. and Reed Street was evident.
Chairman Greg Fajt noted that the casino received its operating license in December 2006. “From what I see … it’s now coming on four years that your client has had an asset of this Commonwealth. And that asset is wasting. That’s what I’m seeing.”
Fajt denied Jacoby’s request to respond to his statement. But elsewhere during testimony, Jacoby said he was tired of making promises to the board about matters involving third parties, over whom he has no control.
During the proceeding, Jacoby and Graci claimed that their client has been treated unfairly – in fact, denied due process – by Lloyd and the Office of Enforcement Counsel.
Jacoby argued that the July 30 discovery deadline was arbitrary, and that Lloyd informed the parties that it was set before they had a chance to tell her how long they thought they would need. Foxwoods quickly asked Lloyd for more time, Jacoby said. When she denied the request, they asked her to forward their petition to the gaming board. She denied that request as well. That’s when Foxwoods filed the emergency petition directly with the board that was ruled on today.
Beyond that, Jacoby said, Foxwoods has been denied requests for documents and depositions with Chief Enforcement Counsel Cyrus Pitre and other gaming board investigators. Graci said that Foxwoods could not even get a definition of continued financial suitability – which is what it must prove it has in order to keep its license. “The remedy that the complaint seeks (taking Foxwoods’ license) is a death sentence for PEDP’s license, and in that sense, it’s a capital case,” he said.
“All we’ve asked is what we have to defend against, and we’ve been told it’s all confidential,” Graci said.
“We have had no discovery,” Jacoby told the board. He said the exceptions were that OEC has “given us our own documents back” and provided a copy of the statement they took from Nick Moles, Foxwoods’ former chief counsel.
Jacoby said that Foxwoods was providing access to people OEC investigators wanted to interview, but their requests for deposition interviews with Pitre and other investigators were being denied by the hearings officer.
Requests for information related to “similar situations” where the board had concerns about a casino development team’s finances, but the license was not revoked, have also been denied, Graci said.
Jacoby referred to a consent agreement reached between Foxwoods and the office of enforcement counsel on April 28 – which would have granted Foxwoods more time to find a new partner and provide documents related to design and site development. The board rejected that agreement on April 29. “On April 28, I’ve learned since, the BIE (the Bureau of Investigation and Enforcement. Pitre is the agency’s head attorney) sent investigators to interview our former CFO.”
Miller objected strongly to all of these revelations, saying that the discovery process is supposed to be confidential, and that Foxwoods was revealing the information to prejudice the board, which would ultimately decide its fate. Fait overruled all of the objections except the one dealing with the CFO interview.
The usually calm Miller got a bit steamed at one point, saying that Jacoby’s statements that his office was not complying with state gaming law and guidelines was absolutely false. But Miller and Pitre spoke for a much shorter time than Jacoby and Graci did.
Lloyd did not speak at the hearing, but Miller said she followed administrative law properly. It’s just that the Foxwoods team did not like her decisions.
Miller and Jacoby agree that according to administrative code, director Lloyd has control over discovery until the discovery conference is complete – a fact Lloyd used when she denied Foxwoods’ attempt to forward their request for more time to the board. While Jacoby argued that the conference was a single-day event, Miller said that the conference is considered open until the discovery process is complete. That means Lloyd only needed to refer the matter to the board if she felt circumstances were extraordinary, he said, and in her opinion, they were not.
“When (a director) is conducting a conference or hearing, and makes a decision that is not amenable to one party, they can’t appeal to the board – that would create chaos,” Miller said.
Miller and Chief Enforcement Counsel Pitre argued that the Thursday hearing should not even have happened. Lloyd had said during the discovery conference that if discovery was not finished by her deadline, she would extend it by a week or two, so long as progress had been made.
But with the discovery period about to end, Foxwoods hasn’t asked for more time, he said.
The board quizzed Jacoby about this, and he said that he did not ask Lloyd for more time because the hearing date had been set for some time, and if the board approved Foxwoods’ petition, they would have had until October 30.
After the hearing, Lloyd, Jacoby, Graci and Miller ducked into a nearby room. Despite the harsh words hurled about in front of the board, they were all smiles. After the conclusion of the regular board meeting, Miller and Jacoby each confirmed there had been a conference, but neither would comment on the nature of it. Jacoby did say he anticipated the time for discovery would be extended.
Neither side, including Fajt, would say very much about what comes next. But Pitre reiterated what he has said from the start: Revocation proceedings take a long time.
When he first filed the petition to revoke Foxwoods’ license, Pitre estimated it would take up to a year, and perhaps as much as four or five years to grant a new license.
There are several appeals pending in the discovery process right now. These are not public information, but from references made during the Thursday hearing, it sounds as if they pertain to documents and/or interviews that the Foxwoods team has been denied. Miller said during the proceeding that his team is also considering filing something related to documents it has been unable to get from Foxwoods.
The appeals are in Lloyd’s hands now. But some board members made reference to the fact that they might one day have to rule on matters related to discovery, and if they decided one side had improperly denied access to another, they could issue an order requiring cooperation.
Foxwoods also has several non-discovery related petitions that remain outstanding, including requests for more time to provide the board with a timeline, architectural renderings and site plans and for the board to waive the $2,000-per day fine Foxwoods has been accumulating since it missed a deadline to provide those plans.
In those filings, the casino’s attorneys argue that they lost a significant amount of time that was spent reaching agreements with Wynn when he withdrew from the project.
Watch the entire hearing below:
Contact the reporter at kgates@planphilly.com
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