City asks judge for quick resolution to slots lawsuit

Wants to rid itself of Moldenhauer and rebid Russell Street site

December 17, 2010|By Nicole Fuller, The Baltimore Sun

Baltimore city officials argued in court Friday for a quick resolution to its legal battle with the would-be developer of a downtown slots parlor, a case that threatens to further delay casino gambling in Maryland's largest city.

City attorneys asked Baltimore City Circuit Judge John P. Miller to issue a summary judgment in the lawsuit filed by Baltimore City Entertainment Group, which contends that the city unlawfully terminated a land deal for the casino after the state declined to give the developer a slots license.

BCEG, headed by Canadian developer Michael Moldenhauer, sued the city for breach of contract in July, seeking $100 million in damages. The city countersued.

City officials say the contract made it clear that the sale was contingent on BCEG's obtaining the required license, a claim that lawyers for BCEG dispute. The 11-acre undeveloped property, which was chosen as the site for the 3,750-machine slots parlor proposed for Baltimore, lies off Russell Street south of M&T Bank Stadium.

City attorneys asked Miller to declare their actions "appropriate," said George Nilson, the city solicitor. Lawyers for BCEG want the case to go to trial.

Miller is expected to issue an opinion in the coming weeks.

"From our perspective, we want a decision as soon as possible," Nilson said. "With this case remaining open and undecided, it raises a cloud with regards to this property."

John D. Quinn, the attorney representing BCEG, maintains that the city breached the contract, which he says allowed for an extension "in the event that we did not receive a gaming license."

Quinn said BCEG is entitled to a trial.

"We feel confident that this is not a case where summary judgment is appropriate," he said. "Baltimore City Entertainment Group has made every effort it possibly could to comply with its obligations under the contract, and we expect by the end we'll be vindicated."

The city won a victory last week when the state Board of Contract Appeals upheld the state slots commission's decision to discard BCEG's bid.

The state Video Lottery Terminal Location Commission, which awards slots licenses, rejected BCEG's application last year after the group was unable to pay the required upfront financing.

The commission's chairman, Donald C. Fry, said this week that he hopes to rebid the site by February, as city officials have requested.

The commission can entertain new bidders while BCEG's appeal is pending, but Fry said it might "have to make a value judgment" about the impact that the litigation could have on prospective bidders.

nicole.fuller@baltsun.com

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