Government, Law, and Travel & Tourism

Coalition lauds court stalling of Lansing casino

Federal judge sees merit to AG’s claim tribe is not sticking to state agreement.

March 8, 2013
| By Pete Daly |
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The ruling by U.S. District Judge Robert J. Jonker in Grand Rapids granting a preliminary injunction against the Sault Ste. Marie Tribe of Chippewa Indians from moving forward in developing a casino in Lansing has been lauded by a coalition of other casinos in the state.

“We applaud Judge Jonker’s order, which will prevent the Sault Tribe from even beginning the federal process to open an off-reservation casino in downtown Lansing. (Tuesday’s) court ruling effectively halts this proposal indefinitely,” said James Nye, spokesman for the coalition.

“Judge Jonker’s order confirms what we have said all along: The tribal-state gaming compacts were intended to stop tribes from reservation shopping for casinos in the homelands of other tribes.”

Nye added that the ruling “will also prevent the Sault Tribe from pursuing a casino in Detroit, Chicago, Cleveland and any other place it had considered for a casino under its seriously flawed legal theory. No one should be surprised that Judge Jonker struck down this preposterous proposal that clearly violates state and federal law.”

Nye was speaking on behalf of the Nottawaseppi Huron Band of Potawatomi (FireKeepers Casino), the Saginaw Chippewa Indian Tribe (Soaring Eagle Casino), and two Detroit casinos: Greektown and MGM Grand Detroit.

The Sault Tribe, which owns the Kewadin Casinos in the Upper Peninsula, has intended to apply to the federal government to take its newly acquired Lansing property into trust so it can develop an off-reservation casino in partnership with the city of Lansing.

However, the 1993 compact between Michigan and the Sault Tribe, which allowed the Kewadin casinos to open, stipulated that, should the tribe plan an off-reservation casino in the future, before it can ask the federal government to take that property into trust it must first reach an agreement with the other Michigan tribes to share revenue from the planned casino. The Sault Tribe has not done that and denies that it is required to do so.

“Other tribes have opened secondary casinos since the 1993 compact was signed and they didn’t have to seek our permission,” said Sault Tribe chairperson Aaron Payment. “It’s their sovereign right to do what they’re doing, and I don’t believe we have a legal obligation, or even a moral obligation” to make an agreement with the other tribes.

He added that the Sault Tribe “remains undeterred” by Jonker’s ruling “and steadfastly committed to pursuing our legal right to develop our Lansing casino. Anyone who understands tribal gaming and the trust land process also understands that this is going to be a lengthy process with multiple legal steps along the way. (Tuesday’s) ruling is simply the first step in the legal process.”

“At the end of the day,” added Payment, “we expect to prevail because our 1997 federal Land Claim Settlement Act clearly gives us the right, and because of the substantial economic benefits the project will generate for the people of Greater Lansing and the members of our Sault Tribe.”

“I trust the legal team” representing the tribe, said Lansing Mayor Virg Bernero at a news conference March 5, the day of Jonker’s ruling. “I’m as excited about the (Lansing casino) project as ever. This is jobs and economic development for Lansing, and I’m confident we will succeed.”

John Wernet, one of the attorneys representing the Sault Tribe, said they are “just beginning to evaluate our next steps. I would stress, though, that what the court entered was a preliminary injunction, not a permanent injunction. Its purpose is to preserve the status quo while the case moves forward on the merits.

“We fully expect to move forward on the merits, we remain confident that our legal position is sound, and we believe that, once we have had a chance to fully develop our position for the court, we will prevail,” he added.

The Sault Tribe is one of eight out of 12 in Michigan with casinos that have stopped making their agreed-upon annual, multi-million-dollar casino revenue-sharing payments to the state of Michigan. The Sault Tribe and five others stopped payments after 1999 because they claimed that when Michigan allowed new casinos to be built in the late 1990s, it broke the compact the earlier tribes had with the state. In those compacts, in return for a share of its slot machine revenues, the state promised each tribe an exclusive, designated geographical area in which no other casinos would be built.

“The problem for the state in this case, I think, is not really so much that there’s going to be a casino in Lansing, but that the state is going to get nothing out of it. The state long ago breeched its compact obligations on market exclusivity with the Sault Tribe. And the Sault Tribe is no longer obligated to pay 8 percent of its (casino slot machine) revenues to the state. … That’s the problem: The state wants that 8 percent back,” said Matthew L.M. Fletcher, a professor at the Michigan State University College of Law. He is a member of one of Michigan’s Indian tribes and also serves as the director of the Indigenous Law and Policy Center at the MSU College of Law.

Fletcher said when the tribes were negotiating with the state to set up casinos in the 1990s, “the major question was market exclusivity. So now that there are 20-some casinos in the state, market exclusivity is sort of a joke.”

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