Meadows buyer files suit against current owner
The pending sale of The Meadows Racetrack & Casino was thrown into jeopardy this week when the buyer filed a lawsuit against the North Strabane Township racino’s owner.
Gaming and Leisure Properties Inc., a Wyomissing investment company with an agreement to acquire The Meadows Racetrack & Casino, said it filed a lawsuit, alleging fraud, breach of the purchase agreement and breach of a related consulting agreement against Las Vegas-based Cannery Casino Resorts. CCR purchased The Meadows in 2004 from Magna Entertainment Corp., and operated the facility for the past decade, building what became one of the largest casinos on the East Coast.
GLPI announced in May it reached an agreement to purchase The Meadows from Cannery Casino Resorts LLC for $465 million.
In releasing its third quarter financial results Tuesday, GLPI, a real estate investment trust that owns 21 casino properties in 13 states, noted the lawsuit under the “Acquisitions” section of the report. It said because of the lawsuit, it could not comment further on negotiations.
“While the company has completed and submitted the information required for its gaming and racing applications to the Pennsylvania Gaming Control Board and the Pennsylvania
Racing Commission, the timing and resolution of the claims set forth in the lawsuit are unpredictable, and the company is not able to predict any effect this suit may have on closing the transaction,” GLPI said. “Given the filing of the lawsuit, the company will not be in a position to provide additional commentary on The Meadows transaction at the present time.”
CCR released a statement Tuesday stating it “believes that the lawsuit is without merit and intends to defend against it vigorously.
“Cannery Casino Resorts intends to take all available measures to ensure the transaction closes by the contractually agreed deadline of Nov. 13, 2015, and GLPI complies with its contractual obligations to use best efforts to receive applicable gaming approvals.”
In announcing the purchase agreement in May, GLPI said it would own the property and buildings at The Meadows, but would seek a third-party company to run the casino and purchase licenses and operating assets.
Of the 21 properties it owns, GLPI, which was formed a year ago as a spinoff from Penn National Gaming, leases 19 of them to Penn National.