Penn National not giving up fight over Iowa casino

Argosy parent Penn National Gaming has asked the five-member state commission to suspend its own order and allow the boat to remain open until resolution of Argosy's lawsuit that challenges that decision and a series of other IRGC actions related to the Argosy license.

The commission will hear arguments and testimony from Argosy attorneys at a special meeting that begins at 8 a.m. Wednesday at Prairie Meadows Racetrack and Casino in Altoona. The commission is scheduled to render a decision upon conclusion of the hearing.

Attorneys for Argosy view the appeal as a long-shot at best, saying in court documents "there is simply no chance that the IRGC will issue a stay, given the positions it already has taken."

A formal rejection by the commission, though, would exhaust Argosy's administrative appeals, something that must happen before the company can pursue its emergency stay of the IRGC's order in Iowa District Court the following day. Judge Eliza Ovrom will hear oral arguments on Argosy's request beginning at 8:15 a.m. Thursday in Des Moines.

The IRGC and the developer of the new Hard Rock Hotel & Casino Sioux City oppose the stay, arguing state gaming law requires that the Argosy close as scheduled. During Thursday's hearing, attorneys for the Hard Rock developer, SCE Partners, will ask the court for permission to intervene in the case.

The IRGC maintains the Argosy license held by its local nonprofit, Missouri River Historical Development, lapsed on April 1st, 2013, after MRHD refused to sign off on an application for a standard one-year renewal.

After talks over a long-term contract between Penn and MRHD broke down in July 2012, the commission decided to replace the boat with a land-based casino and put Woodbury County's license up for bid.

In April 2013, the commission awarded a license to MRHD and Hard Rock developer SCE Partners, over three other applicants, including Penn, which proposed two different sites for a Hollywood-style casino.

Penn has filed a lawsuit to vacate or overturn that decision, claiming the IRGC ignored improprieties in the Hard Rock bid, and violated state law and the Argosy's constitutional rights.In its appeal for a stay of the IRGC order to close the boat by July 1st, Penn argues it will likely succeed on the merits of its judicial review case, in which final arguments are set to begin September 26th.  Absent a stay, Argosy warns it will suffer "irreparable" harm, including the loss of its entire 100 million dollar investment in Sioux City. The boat's 260 employees also would lose their jobs.

In court documents, Penn also takes issue with the IRGC's reasoning for closing the boat. State law requires casino operators to have active contracts with their nonprofit sponsors, who are entitled to a share of the casino revenues. After Argosy's operating agreement with MRHD expired in July 2012, the commission allowed the boat to remain open under what's known as operation of law.

During a contested case hearing in which the Argosy challenged the IRGC's decision not to renew its license, the IRGC defended the nonrenewal on a "completely different group," attorneys for Penn said in court documents.

"It was not that (Argosy) lacked an operating agreement with MRHD, the IRGC now claimed, but rather that MRHD had allowed its own license to lapse, making it impossible for the (Argosy) to have a sort of an operating agreement with a licensed nonprofit”, Penn said in court documents.The Hard Rock Hotel & Casino Sioux City is scheduled to open in August.