Stockton to seek new buyer for Showboat casino

Stockton reached an agreement in April to sell the property to Glenn Straub, who also owns the former Revel Casino Hotel next door, after the school's plans to open a campus there stalled over a dispute with Trump Taj Mahal. The closing was to take place no later than Thursday.

Straub's KK Ventures filed suit against Stockton University on Wednesday, asking for at least an extension on the closing deadline until the legal issues over how the property can be used are resolved. 

"Given Mr. Straub's litigious background, it is not surprising he is suing Stockton since it appears as if he has no intention of buying Showboat for the contracted price of $26 million," acting university president Harvey Kesselman said in a statement. "We will pursue the contract's remedies which include cancellation, and we will actively seek other buyers who want to do what is best for our students, Atlantic City and our region."

Straub said he still wants to buy the property, but the deed restrictions on its use must first be addressed.

"I didn't get involved in this thing because I was interested in getting out of it," he said. 

Caesars Entertainment closed the still-profitable Showboat Casino Hotel in August to cut down on competition in Atlantic City, and put a deed restriction on the property that prohibited gambling there. A 1988 agreement that Trump Taj Mahal is enforcing, however, requires the property be used only as a casino.

That decades-old agreement derailed Stockton's plans to open a campus at Showboat, which the school purchased for $18 million in December under the direction of then-President Herman Saatkamp, who stepped down in April.

Stockton University in May filed a claim in a bankruptcy case in Illinois involving a unit of Caesars Entertainment that sought to resolve the covenant issues, but that has not yet been settled.