On May 29, 2019, the Pennsylvania Gaming Control Board approved a Change of Control petition for the sale of Sands Bethlehem Casino Resort. Two days later, on May 31, 2019, Wind Creek Hospitality officially acquired the casino from Las Vegas Sands Corporation for $1.3 billion, as the transaction closed on Friday. The casino resort facility, which is located in the Lehigh Valley of Pennsylvania, will operate as Wind Creek Bethlehem, and will include amenities such as a 282-room AAA Four Diamond hotel, a 183,000 square foot casino floor featuring slots, table games, and electronic table games, numerous food and beverage outlets, a retail mail, and a multi-purpose event center.
The closing of the transaction comes after approximately fourteen months of regulatory review and, most recently, the PGCB’s approval of the transaction. Duane Morris represented Las Vegas Sands in the transaction, providing gaming regulatory and real estate guidance and assistance in other areas, including serving as co-counsel before the Board for Wind Creek Hospitality. Duane Morris attorneys who assisted on this matter include J. Scott Kramer, Greg Duffy, Frank DiGiacomo, Chris Soriano, and Adam Berger.
On May 29, 2019, at a special hearing convened for this purpose, the Pennsylvania Gaming Control Board approved a Change of Control Petition authorizing the transfer of the entirety of Las Vegas Sands Corporation’s interest in Sands Bethworks Gaming LLC’s to Wind Creek Hospitality, an instrumentality of the Poarch Band of Creek Indians. The Board’s Order, beyond approving the change in control, allows the casino facility to change its name to Wind Creek Bethlehem, reflecting the casino’s new ownership.
Subject to the Board’s conditions, Wind Creek Hospitality is able to acquire all of the interest in Sands, including its licenses, which include a Category 2 License, a Table Games Certificate, and Interactive Gaming Certificates. The Board’s decision comes after over a year of regulatory review.
Scott Kramer, Duane Morris, appeared for joint petitioner, Sands Bethworks Gaming LLC. Also, Duane Morris served as co-counsel before the Board for Wind Creek Hospitality.
In early November 2014, the Iipay Nation of Santa Ysabel, an Indian tribe in California, began offering internet bingo over a website to patrons age 18 and older, regardless of whether they were located on tribal lands. The State of California sued, claiming that the authority to offer online bingo off of tribal lands was not within the scope of the compact between the tribe and the state, was not permitted under California law, and violated UIGEA. The tribe has stated its intention to expand beyond bingo and into poker. The tribe has justified its activities by stating that it is authorized by IGRA to offer and regulate Class II gaming (poker and bingo) from its tribe.
Today, the Department of Justice filed its own lawsuit against the tribe, alleging that the tribe is violating UIGEA and seeking an injunction. The DOJ argues in its complaint that the tribe is necessarily “engaged in the business of betting or wagering,” which is a UIGEA predicate. As a result, the DOJ argues, when someone places a wager from outside tribal lands, the tribe is participating in “unlawful Internet gambling” as defined in UIGEA. The DOJ argues that lotteries and bingo games are prohibited by California law unless authorized for charitable purposes, and that the bingo offered by the tribe is not a bingo game authorized for charitable purposes. Accordingly, according to the DOJ, because the tribe’s gaming activities are not authorized by law, any gaming activity that crosses tribal lines violates UIGEA.
Because UIGEA relates primarily to payment processing, the DOJ seeks an injunction prohibiting the tribe from accepting any credit, EFTs, checks, or proceeds of other financial transactions to be used in any online bingo account by any patron.
This matter could ultimately be consolidated with the State of California’s lawsuit. That case is set for a hearing on California’s motion for a temporary restraining order today (12/4) at 2:00pm Pacific.