The Cordish Companies is suing the city of Norfolk for $100m over the alleged breaking of an agreement that supposedly gave the casino company first rights to develop a casino. [Image: Shutterstock.com]
Seeking significant damages
The Cordish Companies has filed a lawsuit against the city of Norfolk, Virginia over an alleged broken casino development agreement. The plaintiff claims that the city was supposed to give it preference to construct a casino at the Waterside entertainment center when casino gambling was legalized in the state. Instead, the city allegedly contributed to a conspiracy to make sure that no such casino project would proceed.
initially agreed in 2013 to renovate the struggling Waterside center
The Baltimore-based developer, which owns and operates Live! casinos in Maryland and Pennsylvania, had initially agreed in 2013 to renovate the struggling Waterside center through the Norfolk District Association LLC. The plaintiff filed the lawsuit on June 15 in the Richmond Circuit Court and claims that it would not have gotten involved in this risky and expensive project if the city had not committed to supporting Cordish when casino gambling became legal.
Legal casino gambling finally got the green light in Virginia last year, but Cordish did not get the contract to build the city’s casino. That went to the Pamunkey Indian Tribe. Cordish claims that the city used workarounds in order to cut it out of the process and is now looking for $100m in damages, as well as punitive damages and lawyer fees.
Allegations in the lawsuit
The lawsuit claims that the city was in breach of its contract with Cordish after it approached the Pamunkey Tribe in 2018 about developing a casino in Norfolk. Details of this plan first went public in December 2018; casino gambling became legal in Virginia last year.
The Pamunkey Indian Tribe and its financial backers have gotten the green light from the state to develop its Headwaters Resort and Casino, which is not even one mile away from Waterside.
The lawsuit singled out Norfolk City Attorney Bernard Pishko, as he reportedly personally negotiated the original Waterside deal between the city and Cordish, as well as the tribe’s casino deal. The filing states that Pishko and the city attempted to hide the breach of contract and would not work with Cordish. The lawsuit even alleges that the city requested that lobbyists push the legislation in such a way that would lead to the exclusion of Cordish and prevent the location at Waterside from being a possible casino site.
he had boasted to Cordish representatives that he was Norfolk’s “real mayor”
The recent filing also claims that Pishko had been overstepping his authority and that he had boasted to Cordish representatives that he was Norfolk’s “real mayor.” The lawsuit even suggests that a last-minute clause was added to the casino gambling legislation to prevent Cordish from getting a piece of the action. This amendment prevents the building of a casino on land that a housing authority owns. The Norfolk Redevelopment and Housing Authority has owned Waterside since 1999 and leases the property to Cordish’s LLC.
Going with the Pamunkey Tribe
Both the city and Pishko have repeatedly denied that their deal with the tribe was in breach of the Cordish contract. They have also stated that they are under no legal obligation to help Cordish in its attempt to develop a casino in the region.
Cordish has been threatening legal action over the matter for more than a year. It also was secretly backing a citizen group that was against the idea of having a casino in the city of Norfolk and which was campaigning during the November 2020 voter referendum on the matter. Voters were ultimately strongly in favor of having a casino in the city. Cordish made further legal threats before filing its lawsuit this week.
The Pamunkey Tribe does not have any experience developing or operating a casino. It has, though, received the backing of billionaire Jon Yarbrough. He made his fortune through the tribal casino industry, selling Video Gaming Technology, a Class II gaming machine manufacturer, for $1.3bn in 2014. The tribe and Yarbrough are planning to develop a $500m casino, hoping to open it in 2023.