The Pennsylvania Supreme Court has ordered the application for Philadelphia’s second casino returned to the state Gaming Control Board for re-examination. The court ordered the board to examine the ownership structure of Stadium LLC, the partnership of Baltimore-based Cordish Companies and Greenwood Gaming, which owns the Parx Casino in nearby Bensalem, which was awarded the casino license.
In a unanimous decision, the high court ruled that the gaming board had not examine the ownership closely enough—specifically, whether it violates the state law limiting current casino owners to 33.3 percent ownership in a second casino. The scrutiny falls on the financial backer of Greenwood in the project, billionaire Bob Manoukian.
Manoukian owns 85.84 percent of Parx, and is restricted to owning no more than 33.3 percent of a second casino in Pennsylvania. In its initial report to the board, the partnership said Manoukian will own 28.33 percent of Live! outright while another entity, set up for the benefit of certain Manoukian family members, will own 17 percent.
It is the second time in 15 months that the high court has sent the issue back to the board. The gaming board awarded Stadium LLC the license in November 2014. The license—as all so far in Pennsylvania—was quickly challenged by a losing bidder, Market East, to the state Supreme Court. The challenge was joined by SugarHouse LLC, the current Philadelphia licensee.
The challenge accused the applicant of disguising Manoukian’s ownership interest in the project to hide the fact that it is more than 33.3 percent. In a ruling in June 2015, the court held that the board had failed to adequately explore how the restructuring of several of the billionaire’s holdings during the application process impacted his stake in Stadium LLC, and sent the application back to the Board.
In March 2016, the board reported that the ownership structure is within state limits. However, Market East and SugarHouse filed statements with the court at the time objecting that the board reached its decision without holding additional hearings. Final arguments were made in October, and additional documents were sent in December.
Stadium LLC is planning the Philadelphia Live! casino, a 325,000-square-foot casino with 2,000 slot machines in a 300,000-square-foot casino and 18-story hotel with restaurants, music venues, a spa and a 2,600-space parking garage.
