Kansas judge to rule on Harrah's non-compete agreement

Sep 2, 2008 7:03 PM

Industry Insider by Ray Poirier | A judge is expected to rule this week on a lawsuit filed by an Indian tribe that seeks to prevent Harrah’s Entertainment Inc. from building and operating a casino in Sumner County, Kansas.

Lawyers for the Prairie Band of Potawatomi Indians argued that if permitted to go forward, Harrah’s would be violating a non-compete agreement it signed with the tribe last January.

According to documents submitted in the case, Harrah’s, which had managed the tribe’s northeastern Kansas casino for a decade, agreed that it wouldn’t develop, promote or encourage the expansion of gambling in Kansas other than what’s conducted by the tribe. Also, for two years, Harrah’s wouldn’t own, operate or manage a casino.

Last week, Harrah’s was awarded the contract to build and manage a state-owned casino in Sumner County. Lawyers said the company played no role in the passing of a state law that authorizes state-owned casinos. Also, Harrah’s wouldn’t be managing the casino until after the agreement’s two-year limit.

Both sides indicated that if the judge rules against them they will appeal.