Exclusive Content   Join Now

Even Shawn Scott
can have a bad day

Nov 25, 2003 6:39 AM

Normally, I would not write about the same person three weeks in a row.

Not Arnold the Terminator.

Not Kobe and his 19-year-old hotel tour guide.

Not George and Tony in London, or at least in all of London except Trafalgar Square.

Not Scott Peterson, blonde or brunette.

Not Michael in Neverland.

But after what happened to Shawn Scott last week, I have to make an exception. Two columns back I called him the smartest guy in town, and I still think he is smart. But he had a very bad seven days.

He was not hit by lightning or run over by a truck. But those are about the only bad things that didn’t happen to him.

First, the president of his Vernon Downs track venture in New York, Hoolae Paoa, was reported by New York newspapers to be a convicted felon and wife beater in Hawaii. That might keep him from working in a bank, but apparently not at tracks and racinos in New York. Paoa said he had informed all appropriate agencies of his lamented past, and they said okay.

Next, after an unbroken string of racetrack acquisitions in Louisiana, New York and Maine, the streak was broken when Scott, a charmer, failed to charm the New Mexico racing commission, which gave the racing license that Scott was seeking to R. D. Hubbard.

Then Scott offered to partner with Sharon Terry, a track owner who wants to build a new racino in Maine. Ms. Terry turned him down cold, and her lawyer — unhappy that Ms. Terry has only until Dec. 31 to get a referendum passed allowing her to build — accused Scott of having that deadline written into the racino law to block competition by limiting the number of racinos in the state. Maine papers say the racino law in Maine was written not by legislators, but by a lawyer working for Scott.

Scott went to court last week, trying to stop Maine officials from releasing results of their background check into his operations, after several newspapers filed for it under the Freedom of Information Act.

The Wisconsin Oneida Indians bought a huge piece of ground near Scott’s Vernon Downs, presumably hoping to build another big casino near the track. Vernon already faces competition from the Turning Stone, four miles down the road.

Then a federal lawsuit was filed by a group of shareholders who are trying to buy Vernon Downs. They alleged that Scott and his associates "looted" millions of dollars through a series of exorbitant interest loans that they say were filed in violation of federal securities laws. The main plaintiff, Jeff Gural, was quoted in New York Newsday as saying, "In the last 18 months, these guys have just raped the company by putting loans out every few months. Debt has quadrupled (to $23 million) and losses have more than doubled" since they took over. Scott’s publicity folks and lawyers called the suit frivolous, spurious, inaccurate, devoid of substance and a few other things, but it’s still there.

I don’t know Scott, but I do know Jeff Gural, the New York real estate mogul who filed the suit. He is not young and dapper and slick, like Scott is said to be, but he is extremely formidable. You do not make a fortune in real estate in Manhattan by being gullible or short of smarts, and he is a heavy hitter in that very major league. The fact that Jeff Gural has been trying to buy Vernon Downs from Scott — which Scott’s lawyer and publicist made much of — is not unusual, since he is deeply involved in harness racing, which Scott and Paoa are not, and he cares for the sport, which would be unusual for Scott and Paoa in view of their total lack of experience or interest in it or knowledge of it before they saw the gleam of gold in slots at Vernon, and at Bangor Raceway, a little harness track in Maine.

Outside of all of the above, it was a quiet week for Shawn Scott. It may have been the last quiet one he sees for a while.