Pope County Casino Lawsuit Not Dismissed, License Threatened

It is said that sometimes a little rock can upset a large cart, and when it comes to something as complex as assessing an applicant and issuing them a casino license, there could be many little rocks. That is the case with Legends Resort and Casino and its Pope County license after an Arkansas circuit court denied the two motions to dismiss the case, and maybe it all rests on a technicality.

Both Motions Denied

Legends Resort and Casino was granted a casino license in Pope County by the Arkansas Racing Commission in November last year. The licensee company was apparently formed as a limited liability company in September – just a couple of months prior. The problem is, according to a Pope County citizen – John “Cliff” Goodin – that this is in direct conflict with Amendment 100, which made casino gaming possible in Arkansas. There is a provision in the regulation about issuing casino licenses – that they can only be issued if the company can “demonstrate experience conducting casino gaming”. This is obviously not possible, since the limited liability company that received the license – Legends Resort and Casino, LLC – was created only four months prior to that. However, this is a company operated by Cherokee Nation Businesses, LLC (CNB) – which is a company owned by the largest Native American tribe in the US, and it certainly does have casino experience.

Pulaski County Circuit Judge Wendell Griffen who looked at the two motions to dismiss the lawsuit – one by the Racing Commission itself, the other by Legends Resort and Casino, LLC and Cherokee Nation Businesses, LLC – decided to deny both motions. The two motions rest on the Court lacking jurisdiction and that the plaintiff lacks standing to sue. Also, according to the motions, Goodin’s claims are “barred by sovereign immunity.”

Court Reasoning, Ruling

In the court document, Judge Griffen clearly states that while a suit against the State is indeed barred by sovereign immunity, there are some notable exceptions to this, which would see it dropped. A suit against the “state agency” – in this case, the Racing Commission – is not prohibited if the state agency is “acting illegally”, as is alleged in this instance, which means the agency (or officer) “may be enjoined from acting arbitrarily, capriciously, in bad faith, or in a wantonly injurious manner”. The court document proceeds by saying that since the “petitioner seeks declaratory and injunctive relief, not money damages,” then the suit is “not subject to the asserted sovereign immunity defense”.

The notion that the matter is moot was also dismissed, as in court this happens when the rendered judgment would have no “practical legal effect upon a then existing legal controversy”. Since a company’s license is on the line, this obviously disqualifies the notion that the subject matter is moot.

The court document also outlined how Amendment 100 might indeed have not been complied with, when issuing a license to Legends Resort and Casino, LLC. The company was formed in September 2019 and applied for a license in January 2020. The application was approved sometime after that, but without this license, and without other licenses, as is required by regulation, the company cannot operate a casino license. While CNB argues that since it is the business with the experience, the license is factually indeed compliant, the Court dismissed that, on the grounds that CNB was not the applicant for the license, the newly formed Legends Resort, and Casino, LLC was.

In effect, the court concluded that issuing the license to both Cherokee Nation Businesses, LLC and Legends Resort & Casino, LLC, as well as issuing the license to a company with no prior experience violated the “powers entrusted to the Racing Commission pursuant to Amendment 100” and is “outside of the Commission’s constitutional authority”. And, since the allegations present a constitutional question, then the argument for the matter becoming moot also loses grounds, as well.

If it does get decided that the Racing Commission’s actions were unconstitutional, then the issued “license to CNB/Legends is invalid”. This would mean that “any rights asserted by the purported licensee are null and void,” leaving Legends’ license in the air for now.