August 19, 2009
Ganging up on Atlantic City
Connecticut’s tribal gambling giants Foxwoods and Mohegan Sun have put aside their rivalry to join forces on an advertising campaign aimed at taking market share from their competitors in Atlantic City.
The attack, launched online and on billboards on Interstate 80 in New Jersey, the New Jersey Turnpike, the Atlantic City Expressway and the Long Island Expressway, leaves nothing to subtlety: “Two worlds beat one City,” goes one billboard. “Way beyond the boredwalk,” another says. “Escape the Jersey snore,” says another.
“It’s very important for us to get people to look at the Connecticut casinos as a destination,” Mohegan Sun President Mitchell Etess told The Day. “It’s Atlantic City or Connecticut — not Atlantic City or Mohegan Sun, or Atlantic City or Foxwoods.”
Foxwoods and Mohegan Sun are contributing an equal share to the campaign, according to press reports, though no casino official would say how much.
Clyde Barrow, director of the Center for Public Analysis at the University of Massachusetts at Dartmouth, described the alliance as “the logical culmination of a trajectory they’ve been on for some time.”
“They’re in very stiff competition with Atlantic City, New York, Pennsylvania and likely Massachusetts,” he said. “If Massachusetts gets gambling, it’s going to recapture a sizable piece of the regional gaming market. That’s why Foxwoods and Mohegan Sun have to be part of a larger tourist destination.”
The billboards and the Web site (www.playCTcasinos.com) will remain in place through September, at which time the campaign’s effectiveness will be evaluated, said Robert Victoria, Foxwoods’ senior vice president of consumer marketing. The campaign might also be expanded to include a print-advertising component.
PENN NATIONAL APPLIES FOR NEVADA LICENSE
Penn National Gaming, rumored for months to be on the prowl for bargains on the Las Vegas Strip, has applied for a Nevada gaming license.
The pretext for the application was Penn’s purchase of a 1 percent stake in Morris Goldstein and Associates, an independent slot machine distributor run by the former CEO of Alliance Gaming, now Bally Technologies.
Publicly traded Penn, which operates 19 casinos and racetracks in the United States has roughly $1.5 billion in cash and has been linked since last year to numerous acquisition rumors along the Strip.
“The strategy is ultimately to have the mechanism ready to do something, should something fall into place,” spokesman Joe Jaffoni told the Las Vegas Review-Journal. “The company is still interested in Las Vegas.”
Union Gaming Group principal Bill Lerner said getting licensing approval now could help Penn negotiate a better price multiple for a Strip casino down the road.
“If closing a deal more quickly is important, a seller might be willing to give up some dollars in exchange for speed,” he said. “It’s a good heads-up move by Penn National to move forward.”
Observers have linked Penn to casinos operated by MGM Mirage and Harrah’s Entertainment. During its first-quarter earnings conference call this spring, Chairman and CEO Peter M. Carlino said the company was taking its time assessing various Las Vegas assets.
“Time alone will tell whether we can find the right opportunity at the right price,” he said.
SWINE FLU TAKES TOLL: MEXICO DOWN MILLIONS
Mexico’s gaming industry has lost more than US$29.6 million as a result of the Swine Flu epidemic.
The news was announced by Alfonso Pérez Lizaur, president of the Association of the Games and Draws Licensees, a private-sector trade group.
Pérez said the disease forced the industry to close its doors for five weeks, affecting 731 sports betting venues, 364 bingo halls, six horse tracks, four greyhound tracks and three jai alai frontons.
The association estimates that the epidemic, coupled with the effects of the global economic downturn, will shave at least 4 percent from the industry’s 2009 profit margins.
WYNN DEALERS TAKE TIP-SHARING DISPUTE TO FEDERAL COURT
Dealers for Wynn Resorts have fired another shot in their long-running and up to now unsuccessful battle to overturn mandatory tip-sharing at the company’s flagship Wynn Las Vegas casino, filing a lawsuit against the policy in federal court.
The suit, filed in U.S. District Court in Las Vegas by dealers Quy Ngoc Tang, Leopold Gemma and Daniel Baldonado, charges the company with violations of the federal Fair Labor Standards Act. The suit, which seeks to represent all affected Wynn Las Vegas dealers, claims that by requiring the dealers to share tips with supervisors, Wynn Las Vegas effectively is paying the dealers nothing in violation of federal minimum wage and overtime laws.
The suit is independent of a pending state court case, said an attorney for the dealers.
The state dispute arose with a lawsuit challenging the policy, which was instituted at Wynn Las Vegas three years ago and gives immediate supervisors a share of gamblers’ tips to dealers, a departure from the historical practice of dealers alone sharing their tips.
The Nevada Supreme Court last year sided with a Clark County District Court that the issue should be brought before the state Labor commissioner, who continues to hold hearings in the dispute.
SOVEREIGNTY TAKES HIT IN PERSONAL INJURY SUITS AGAINST CHOCTAW CASINO
In a ruling that could have significant impact on gaming and tribal sovereignty the Oklahoma Supreme Court has ruled in two split decisions that lawsuits against Indian casinos can be heard in state courts.
The decisions involve personal injury claims against the Choctaw Casino in Pocola.
In the second case the Supreme Court overruled a lower court ruling that dismissed an injury claim on the grounds that only tribal or federal courts have jurisdiction in Indian matters.
“We hold that Oklahoma district courts are ‘courts of competent jurisdiction’ as that phrase is used in the Model Tribal Gaming Compact,” the majority said. “Nothing in this opinion should be taken as a holding that a tribal court is not a ‘court of competent jurisdiction’ or should be taken as eliminating the tribal court as a forum available to a tort claimant if the claimant chooses to file suit in tribal court.”
Bob Rabon, an attorney for the Choctaws, declined to say how the tribe will proceed, according to press reports. “We’ve still got arrows in our quiver,” he said. “We’re not done. We’re not done by a long shot.”
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