Iowa casino dispute gets court date

A case coordinator set a Feb. 12, 2018 trial date in Polk County District Court for Penn National Gaming's breach of contract suit against Missouri River Historical Development.

District Judge Lawrence McLellan is presiding over the case.

Action in the case had been on hold for months while lawyers focused on resolving a separate lawsuit dealing with the actions that led to the casino's closure.

In its breach of contract suit, Penn sued MRHD, the state-licensed nonprofit group that had held Woodbury County's gambling license with the Belle of Sioux City, a subsidiary of the Wyomissing, Pa.-based Penn National Gaming, in 2012, claiming that MRHD schemed to replace the Argosy with another operator even before their 20-year contract expired in July 2012.

The Iowa Racing and Gaming Commission later put Woodbury County's license up for grabs and began accepting proposals for a land-based casino after MRHD and Penn could not agree on a long-term contract extension that would have included a land-based casino.

MRHD denied the allegations and countersued, claiming that Penn interfered with MRHD's prospective relationships by sending letters threatening legal action against potential operators with whom MRHD might pursue an agreement. MRHD claimed Penn's actions prevented or delayed it from negotiating a more lucrative land-based casino agreement.

The casino closed in July 2014 after the IRGC denied the Belle's license renewal, and MRHD had formed a partnership with developers who built and opened the Hard Rock Hotel & Casino in downtown Sioux City.

In May, the Belle's challenge of the IRGC's action ended when the Iowa Supreme Court denied its request to review an Iowa Court of Appeals ruling that upheld previous rulings that led to the casino's closure.

Belle of Sioux City is subject to another lawsuit filed by Community Action Agency of Siouxland for nearly $2 million in revenue-sharing payments that were withheld from MRHD for distribution to charities. The agency is seeking the money on behalf of itself and as many as 54 other nonprofit agencies that in the past have received grants from MRHD, the state-licensed nonprofit gaming group that distributed a portion of the casino's gambling profits to dozens of area organizations.

Penn stopped making payments - 3 percent of the Sioux City boat's adjusted gross revenues - to MRHD for 16 months before the Argosy's closure.