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Appeals Court favors Lyttons in San Fran club dispute

Sep 30, 2003 5:16 AM

An urban casino in the San Francisco Bay area is closer to reality because of a ruling by the 9th U.S. Circuit Court of Appeals that denied a request from competing card room operators for an injunction against the Lytton Band of Pomo Indians.

The Indians want to take over the Casino San Pablo that was sold a couple of years ago by the English gambling firm, Ladbroke, a division of the Hilton Group Plc, when the company divested all of its American gambling enterprises. They since have been working to have the card club placed in trust for the Lytton Band since the tribe is currently landless.

During the summer, lawyers representing the cardrooms Artichoke Joe’s II, the Grand Casino and the Oaks Club, argued before Judge David Levi that the Lytton Band’s takeover of the Casino San Pablo card room would deny them equal constitutional protections. The judge favored the Indians and the card clubs appealed.

The ball now falls into the court of Interior Secretary Gail Norton who could transfer Casino San Pablo’s title to the Lytton tribe immediately.

Intervening, however, is Sen. Dianne Feinstein, D-Cal., who has asked Norton to postpone taking action until all litigation is completed.

"I believe it would be a mistake for the Department of Interior to go forward, even if legally permissible, when there continue to be questions about whether the Lyttons were ever validly recognized as a tribe," the senator wrote in a letter to Norton.

Federal action would permit the Lytton Band to transform Casino San Pablo from an ordinary card club into a Class II gambling hall complete with electronic bingo games with unlimited jackpots. The next step would be for the tribe to seek a gaming compact with the state that would place them in a position to build a Las Vegas-style casino.

Aggressive mode

Isle of Capri Casinos Inc. (ISLE) moved to expand its domains on two fronts last week. The first was in Missouri where the company has proposed buying the troubled President Casino in St. Louis. The second was in Iowa where Isle is proposing an $80 million hotel/casino in Waterloo.

The city of St. Louis has been handicapped by the presence of the President on the Admiral Casino since it is the smallest gaming venue in the area and produces the least amount of revenue. Officials also fear the licensing of another casino in south St. Louis County that would further hurt the President’s operation.

By having the same company, Isle of Capri Casinos, bidding for both the President and for a second casino in another part of the county, officials said, would sit well with the Missouri Gaming Commission whose members probably would feel more comfortable dealing with just one company.

Also, it was noted that Isle of Capri has established an enviable track record of improving poor casino performers. The company purchased and refurbished the Flamingo Hilton Riverboat casino in Kansas City and turned the property into a successful operation. It also did the same with a President riverboat casino in Davenport, Iowa.

Isle of Capri already operates two facilities in Missouri. They are the Kansas City riverboat and another in Boonville.

In Iowa, voters in Black Hawk County will go to the polls on Oct. 7 to determine whether they favor bringing a riverboat casino to Waterloo, the plan being proposed by Isle of Capri.

The plan is believed to have a greater chance of succeeding than the $50 million casino being suggested for Cedar Rapids in Linn County whose voters will decide on the plan during voting on Nov. 4.

Since the two plans compete, officials said state regulators would approve only one with the Waterloo plan emerging as the early favorite.

The Insider

With the third quarter reporting period about to start, four major gaming companies have announced dates for their conference calls. Harrah’s Entertainment Inc. (HET) will host its call on Wednesday Oct. 22 at 7 a.m. PDT. Aztar Corporation (AZR) also will conduct its conference call on Wednesday Oct. 22, with a starting time of l:30 p.m. PDT. On Thursday, Oct. 23, Park Place Entertainment Corporation (PPE) will host a call at 8 a.m. PDT, and Boyd Gaming Corporation (BYD) also will review its quarterly experience with a call on Thursday, Oct. 23, at l:30 p.m. EDT.

Shareholders of Acres Gaming Inc. (AGAM) have approved the $130 million merger deal with International Game Technology. The company said 64% of the outstanding common stocks were voters in favor of the merger.

Mikohn Gaming Corp. (MKIN) said it has lowered its cash interest payments through a note repurchase arrangement. It also said it will sell 8.4 million shares for $5.34 a share and issue warrants for 2.1 million shares worth $5.88 a share.

During the hot stocks segment of the Louis Rukeyser’s Wall Street program last Friday, Kim Goodwin, chief investment officer at State Street Research suggested shares of Alliance Gaming Inc. (AGI) could rise 30% over the next 12 months.

International Lottery & Totalizator Systems Inc. (ITSI) says it has received an order valued at $3.4 million from Sports Toto Malaysia for additional lottery equipment.

Shuffle Master Inc. (SHFL) is suing Casinos Austria Research & Development for alleged patent infringements of its card shufflers.