From ABC News
After paying an $11 million advance to a struggling Atlantic City casino it intended to buy, the parent company of the world’s largest online poker website was left with nothing for its troubles Friday when a judge ruled the casino had the right to scrap the deal.
Superior Court Judge Raymond Batten said The Atlantic Club Casino Hotel could terminate the contract it signed with The Rational Group, the British parent company of PokerStars, when the company failed to get New Jersey’s preliminary approval by April 26 to own a casino.
The judge said the contract clearly gave either party the right to end the deal if Rational had not obtained the state’s authorization by the April date.
With the ruling, Batten dissolved a temporary restraining order that barred the casino from selling to anyone else. The Rational Group had obtained the temporary order after the Atlantic Club backed out of the deal even while benefiting from Rational’s payment to get the casino through the winter.
“We saved their butts,” Wayne Positan, a lawyer for The Rational Group, told the judge. “And we got the short end of the stick.” He said it was like the casino said: “Let’s take that money and the heck with those guys. Ha, ha, ha.”
According to court testimony, the contract also contained a provision that if the deal was not completed by a specified date, The Atlantic Club could keep the money Rational had advanced it. The funds were intended as credits against the $15 million purchase price.
The purchase deal was reached on Dec. 24, and the state Division of Gaming Enforcement deemed Rational’s application complete in early April, then began its evaluation process, which normally takes at least three months.
“They (Rational) took the risk they could get it done,” Atlantic Club lawyer Tariq Mundiya told the judge. “They couldn’t get it done, and now they want to rewrite the contract. Once that date came and went, Your Honor, all bets were off.”
