Judge rules against Walsh on casino challenge

Tosses Boston’s claims, allows Mohegan Sun to proceed

SUFFOLK SUPERIOR COURT JUDGE JANET SANDERS on Thursday dealt a crushing blow to Boston Mayor Marty Walsh’s nearly year-long bid to overturn the award of a casino license to Wynn Resorts in next-door Everett, tossing out all of the claims contained in the city’s lawsuit.

Boston alleged in its sprawling lawsuit that the Gaming Commission erred in ruling that Wynn was suitable to obtain a license, that Boston was a surrounding community to the casino, and that Boston had waived its status as a surrounding community. The city sought to throw out the casino license award to Wynn and disqualify all commissioners from any future proceedings.

Sanders chose not to address each of the city’s claims. Instead, she held that Boston could mount a legal challenge only where it could show it had suffered some harm “within the zone of interest protected by the Gaming Act itself.” She said the only claims that fit that definition were the commission’s rulings that Boston was not a host community to the casino and that Boston had waived its surrounding community status. “But as to those decisions, the undisputed facts show that the commission did not violate either the Gaming Act or its regulation,” Sanders wrote. “The upshot is that the entire complaint must be dismissed.”

In a separate ruling, Sanders rejected similar claims brought by the city of Revere and Mohegan Sun, Wynn’s rival for a casino license. She also rejected claims brought by union electrical workers that the Gaming Commission had violated the state’s Open Meeting Law.

But Sanders did allow Mohegan Sun, which wanted to build a casino in Revere, to proceed with a challenge to the Gaming Commission’s license award on the grounds that the casino developer had a “justiciable right” for purposes of certiorari review, meaning the company should be allowed to challenge the ruling of a body acting in a quasi-judicial capacity. The ruling was a bit of a surprise since the Gaming Act specifically prohibits an applicant who fails to win a license from challenging the decision.

Walsh could not be reached for comment Thursday night, so it’s unclear whether he might appeal.

Elaine Driscoll, a spokeswoman for the Gaming Commission, said in a statement that she hoped everyone could move forward. “We are gratified by the judge’s decision and believe it is a validation of the hard work and detailed effort put forth by the commission and its staff. We are hopeful that Wynn and the cities of Boston and Revere can now begin to reconcile their differences through open dialogue and negotiation as opposed to legal action.”

Michael Weaver, a spokesman for Wynn Resorts, said the Las Vegas casino developer was very pleased with the ruling. “We are well underway in successful site remediation and look forward to creating 4,000 union construction jobs, $1.7 billion in construction spending, 4,000 permanent jobs, and bringing $22.3 million in taxes a month to the Commonwealth and local communities,” he said in a statement.

Boston and Wynn Resorts have been engaged in a fierce and sometimes nasty legal and public relations war for more than a year. Walsh has fought Wynn in the courts and threatened to withhold permits the company might need to build its casino. A major battleground has been Sullivan Square in Charlestown, through which many of Wynn’s patrons are likely to travel. Walsh is also challenging in court an environmental permit the state issued to Wynn. In both cases, Walsh has retained the services of an outside law firm and spent more than $1.3 million on legal fees.

At times, the infighting has gotten nasty. Walsh at one point alleged that Wynn Resorts officials knew that a felon held a hidden interest in the Everett land on which Wynn intends to build its $1.7 billion casino. The city of Boston also alleged that private detectives working for Wynn were given access to a wiretap room at the attorney general’s office at a time when the Everett land deal was being investigated.

Wynn officials denied the allegations, and eventually filed a libel claim. Sanders last month gave the Las Vegas company permission to depose Walsh’s corporation counsel, Eugene O’Flaherty, and outside counsel, Thomas Frongillo, in an effort to find out who leaked the allegedly libelous claims to the Boston Globe.

The US Attorney’s office, which is prosecuting individuals for allegedly concealing the involvement of a felon in the Everett land deal, jumped into the fray in July. Assistant US Attorney Kristina Barclay focused on the alleged wiretap room incident.  “Without a shred of evidence, and despite having been warned that the ‘alleged incident’ never happened, the defendants seized on a rumor spewed by the city of Boston in a vicious civil lawsuit against the Massachusetts Gaming Commission and filed a Brady motion questioning the integrity of this criminal prosecution,” she said in a court motion. A Brady motion typically seeks evidence favorable to the defense that is allegedly being withheld by prosecutors.

Judge Sanders has also been critical of Walsh for playing to the media outside the courtroom rather than sticking to the facts of the case. In her decision, issued shortly before 5 p.m. on Thursday, she didn’t reiterate that criticism, but she called the city’s complaint “needlessly long and the legal claims difficult to decipher.”

Sanders said Boston’s complaint alleged a lot of irregularities in the Gaming Commission’s decision to award a casino license to Wynn. But she said most of those alleged irregularities did not harm Boston, and therefore refused to consider them.

The judge suggested Boston was harmed by the Gaming Commission’s ruling that the proposed Wynn casino was located entirely in Everett, thus making Boston a surrounding and not a host community. She also noted the Gaming Commission chose to “de-designate Boston as a surrounding community” after the city refused to negotiate a surrounding community agreement with Wynn and failed to participate in arbitration proceedings to reach an agreement. In each of those instances, Sanders said, the Gaming Commission acted properly and within the law.

Meet the Author

Bruce Mohl

Editor, CommonWealth

About Bruce Mohl

Bruce Mohl is the editor of CommonWealth magazine. Bruce came to CommonWealth from the Boston Globe, where he spent nearly 30 years in a wide variety of positions covering business and politics. He covered the Massachusetts State House and served as the Globe’s State House bureau chief in the late 1980s. He also reported for the Globe’s Spotlight Team, winning a Loeb award in 1992 for coverage of conflicts of interest in the state’s pension system. He served as the Globe’s political editor in 1994 and went on to cover consumer issues for the newspaper. At CommonWealth, Bruce helped launch the magazine’s website and has written about a wide range of issues with a special focus on politics, tax policy, energy, and gambling. Bruce is a graduate of Ohio Wesleyan University and the Fletcher School of Law and Diplomacy at Tufts University. He lives in Dorchester.

About Bruce Mohl

Bruce Mohl is the editor of CommonWealth magazine. Bruce came to CommonWealth from the Boston Globe, where he spent nearly 30 years in a wide variety of positions covering business and politics. He covered the Massachusetts State House and served as the Globe’s State House bureau chief in the late 1980s. He also reported for the Globe’s Spotlight Team, winning a Loeb award in 1992 for coverage of conflicts of interest in the state’s pension system. He served as the Globe’s political editor in 1994 and went on to cover consumer issues for the newspaper. At CommonWealth, Bruce helped launch the magazine’s website and has written about a wide range of issues with a special focus on politics, tax policy, energy, and gambling. Bruce is a graduate of Ohio Wesleyan University and the Fletcher School of Law and Diplomacy at Tufts University. He lives in Dorchester.

“The fact is that the injuries that Boston claims to have suffered at the hands of the commission do not flow from the choice that the commission made between two applicants (Wynn and Mohegan) but from Boston’s location via a vis any proposed casino,” Sanders wrote. “Its standing is thus necessarily limited to challenging only those commission decisions regarding the right that it had (if any) as a host or surrounding community for the casino applicant that was ultimately successful in obtaining a gaming license.”

Sanders also said she had no business imposing her viewpoints in place of the Gaming Commission. She held that the Gaming Act, “with its broad delegation of authority to the commission, strongly suggests a legislative intent to have the types of decisions at issue here made not by a reviewing court but by the agency charged with administering it. Under such circumstances, it is even more important that the courthouse doors be open only to those whom the Gaming Act was designed to protect. Beyond its status as a host or surrounding community, the city of Boston is no different than a member of the general public unhappy with (but not injured by) the commission’s acts.”