Caesars Entertainment promises to appeal lawsuit dismissal against Stephen Crosby

Judge Gorton dismissed the gaming company’s lawsuit against Stephen Crosby, which alleged he favored another development over Caesars’ planned US$1 billion hotel-casino complex in partnership with the Suffolk Downs Racetrack.

The company said in a statement it would appeal the ruling to 1st U.S. Circuit Court of Appeals. Caesars said the decision to end the case, which was filed in December, denied the company an opportunity for discovery and the ability to prove its allegations.“Caesars and the citizens of the Commonwealth deserve to know the truth about the conduct of the leader of the Massachusetts Gaming Commission,” company Chairman Gary Loveman said in a statement.

Caesars was dropped from the project after an investigative report from an outside firm brought up several areas of concern with the casino operator, hurting the company’s chances of being found suitable by the commission.

One of the issues involved Caesars’ marketing agreement with a luxury hotel operator in the redevelopment of Bill’s Gamblin’ Hall on the Strip. An investor in the hotel company reportedly had ties to Russian mobsters. Caesars ended the agreement with the company and the casino has since reopened as The Cromwell.

Caesars claimed in its lawsuit that Crosby favored a rival proposal by Wynn Resorts for the state’s single Boston-area gaming license because of the chairman’s past business relationship with one of the land owners for the site of Wynn casino.

Crosby has since removed himself from the debate over the Boston license.

According to the Boston Globe, the judge acknowledged it would be unconstitutional for a state official to conspire to deprive an applicant the opportunity to compete for a state license for the purpose of favoring a former business partner.

In his dismissal, the judge wrote that Caesars’ allegations against Crosby were concluded “by assuming a series of improbable inferences, themselves resting on the shaky foundation of a number of naked assertions.” The judge said he didn’t “assume” Caesars’ claims were “true at this juncture.”

Caesars said the judge denied the company a chance to prove its claims, despite acknowledging that some of the actions described in the lawsuit would “‘shock the conscience’ as ‘truly outrageous,’ and thus constitute a violation of substantive due process.”