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- Court Finds Investment Advisor’s Payments to Customers Are Not Exempt From Avoidance Under Section 546(e) of the Bankruptcy Code
- Vitro Update: “Savings Clause” Fails to Save Vitro Subsidiaries From Involuntary Bankruptcy
- SDNY Denies Payment of Administrative Expense Claim by Relying on the Operative Document as a Whole and Rejecting a Statutory Rule of Construction
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Author Archives: Scott J Greenberg
Gaming Alert – New Jersey Governor Chris Christie Conditionally Supports Online Gambling – Boyd Gaming and Caesars Stocks Rally as a Result
On February 7, 2012, New Jersey Governor Chris Christie issued a conditional veto of a bill that would legalize online gambling in New Jersey, but indicated that he would approve the bill if a few changes were implemented, including an increase in the tax rate from 10% to 15% and the inclusion of a provision that would allow the legislature to reevaluate the bill after 10 years. The legislature is expected to promptly incorporate these revisions and resubmit the bill to Governor Christie in mid-March. This signifies a significant step forward for online gaming in New Jersey and throughout the U.S. Continue reading
Posted in Gaming
Tribal Gaming Enterprise Held Ineligible to File for Chapter 11
Since the passage of the Indian Gaming Regulatory Act in 1988, casinos owned by Native American tribes have proliferated across tribal lands and have generated billions of dollars in revenue annually. While casinos such as Mohegan Sun and Foxwoods are among the largest and well-known tribal casinos, over 60 exist in the State of California, where many dozen small properties have sprung up throughout the state in recent years, in some cases built in part with the proceeds of high-yield bond debt. This recent growth spurt juxtaposed with the prolonged downturn in consumer spending has clearly demonstrated that numerous tribal casinos, like their mainstream competitors, are overleveraged and need to restructure their financial obligations in order to sustain their operations. Continue reading
Posted in Analysis
Gaming Alert – Eastern District of New York Rules Poker Is Not Gambling Under IGBA
In a decision that could have a significant impact on distressed gaming companies, Judge Jack B. Weinstein of the U.S. District Court for the Eastern District of New York ruled on Tuesday that poker does not constitute gambling under the Illegal Gambling Business Act (“IGBA”), a federal statute that makes the operation of any “illegal gambling business” a criminal offense. See U.S. v. Dicristina, No. 1:11-cr-00414-JBW (E.D.N.Y. Aug 21, 2012). While poker operations remain illegal under the laws of the vast majority ofU.S. states, includingNew York, the decision may lend support to the argument that online poker operations should be considered outside the scope of certain other federal laws regulating online gaming. Continue reading
Posted in Gaming
Time to Roll the Dice on Online Gaming?
On December 23, 2011, the U.S. Department of Justice Office of Legal Counsel (“OLC”) issued a memorandum opinion dated September 20, 2011, eliminating one of the federal barriers to legalizing internet gambling and opening the door for the possibility of a regulatory regime shift.[1] In the OLC Opinion, the Department of Justice addressed an apparent conflict between the Wire Act and UIGEA and concluded that “interstate transmissions of wire communications that do not relate to a sporting event or contest” fall outside the reach of the Wire Act. Finding that the Federal Wire Act does not prohibit the use of out-of-state transaction processors to sell in-state lottery tickets over the internet or the transmission of lottery data across state lines, the OLC Opinion reverses the long-held position that the Wire Act applied to all interstate gambling, whether sports-related or not. Although it may take some time to determine the ultimate effect of the OLC Opinion, now that the Justice Department has clarified its view that the Wire Act does not broadly prohibit online wagering (unless it relates to sporting events or contests), the advance of internet gaming appears inevitable. Continue reading
When Tribal Gaming Goes Sour – Rights & Remedies in an Unclear Legal Environment
Although the steep downturn in the U.S. gaming industry that began in 2008 appears to be easing for the time being, many mid-market gaming companies are still encountering difficulties servicing their debt as consumer spending slowly creeps back. In 2009, the Restructuring Review ran a two-part series on the strategies available to gaming companies seeking to restructure their debts, and the challenges facing creditors who must choose between writing down their investments or attempting to foreclose on their collateral. This article examines additional and unique challenges facing creditors attempting to restructure debt issued by tribal gaming entities. Continue reading
Posted in Analysis, Gaming
Tagged casinos, Chapter 11, Chapter 7, IGRA, NIGC, section 303, tribal