The Cordish Companies is seemingly undertaking a noble effort in State College, Pennsylvania, as the Baltimore-based gaming and hospitality corporation continues to battle an agreed-upon plan for Bally’s to install a casino in the Nittany Mall near the main campus of Penn State University.
The Nittany Mall sign could one day have a Bally’s logo and casino within the shopping center which is located less than five miles from Penn State University. However, legal challenges from the Cordish Companies to the Bally’s project may delay the venture for an extended period of time in Pennsylvania’s courts. (Image: Casino.org )
Cordish runs two casinos in Pennsylvania—Live! Casino Hotel Philadelphia and Live! Casino Pittsburgh. The latter property is a Category 4 so-called “mini-casino” situated in the suburban area of Westmoreland, but not the city of Pittsburgh itself.
As part of Pennsylvania’s 2017 gaming expansion package, state lawmakers and then-Governor Tom Wolf (D) authorized Category 4 satellite casinos in order to generate quick revenue for the state. The Pennsylvania Gaming Control Board (PGCB) was assigned the task of giving out the Cat. 4 licenses through a competitive bidding process that included only one qualifying criterion: which bidder offered the most money for the license.
The state initially only admitted current slot licensees—i.e. casinos—to participate in the bidding. But after the bidding process became stagnant, the PGCB opened up the Cat. 4 licensing opportunities to investors who held important ownership positions in a slot concession. This allowed former Penn State trustee and Pennsylvania businessman Ira Lubert, who possesses a 3% stake in Rivers Casino Pittsburgh, to bid during the state’s September 2021 auction round.
Lubert put forward the highest bid at $10,000,101. Lubert chose College Township for his satellite casino, a community that did not opt out of the Cat. 4 host location pool when it had the chance to.
Legal Filings
The State College community is firmly against a casino being situated so close to the Penn State University Park campus. Our previous coverage has received hundreds of comments from local State College citizens who have criticized everyone from the College Township Council to Lubert. We’ve heard from only a few State College residents who are in favor of the casino.
Shortly after winning the September 2021 auction, Lubert declared that he was partnering with Bally’s Corporation to invest more than $113 million to renovate the previous Macy’s department store at the Nittany Mall into a casino. But Cordish, operating in Pennsylvania as Stadium Casino RE, LLC, contends in court that Lubert disregarded bidding rules by constructing an ownership scheme before obtaining his Cat. 4 license.
Stadium representatives allege that Lubert did not solely pay the $10 million bid, as necessary through the 2017 gaming law. Lubert has consistently denied those remarks, alleging that Cordish is merely being a poor loser.
Stadium is appealing the PGCB’s January 2023 decision to accept Bally’s State College to the Pennsylvania Supreme Court. The plaintiffs contend that the PGCB had no right to even ponder Lubert’s bid because he violated gaming regulations.
Discovery Request
Along with appealing the PGCB’s Cat. 4 licensing decision to the state’s highest court, Cordish lawyers in the interim are trying to acquire confidential business dealings from the Lubert group. In response to the discovery request, attorneys for the PGCB state that it would be best to first permit the Supreme Court appeal to play out.
The PGCB attorneys additionally state that the state, and only the state, should be privy to Lubert’s confidential business communications.
“Who has the legal authority to evaluate an application to possess a casino license in order to make sure it abides by the Pennsylvania Race Horse Development Act—the PGCB or the losing bidder for the same license?” PGCB’s legal response asked.
Cordish attorneys believe that more transparency would expose more collusion on Lubert’s behalf. The case continues.
