1. Casino Queen Esop Lawsuits
2. Casino Queen Esop Lawsuit Filed
3. Casino Queen Esop Lawsuit
4. Casino Queen Esop Lawsuit Settlements

EAST ST. LOUIS — Two former Casino Queen employees have filed suit against the casino’s old owners over the 2012 sale of the property that made it employee-owned.

AP – Twenty-two current or past black Casino Queen workers are suing the business in federal court, accusing the gambling site of “systematic” racial discrimination and harassment, then. The company said it would sell the facility's license to a third-party operator, while retaining ownership of the land and buildings. The deal ran into trouble, with GLPI filing a lawsuit accusing Cannery of fraud in October 2014; the lawsuit was eventually settled with an agreement on a reduced purchase price of $440 million. Employee Stock Ownership Plan Acquires Casino Queen December 28 2012 8:54 AM East St. Louis, IL Shareholders of Casino Queen, Inc., who own and operate the Casino. A lawsuit filed late Monday by Employee Stock Ownership Plan committee administrator Grant Lyon claims “fraud and concealment” in the handling of the ESOP from the time it was formed in 2001.

The plaintiffs, Tom Henseik and Jason Gill, allege the former owners of the Casino Queen Inc. sold their stake in the company into an employee stock ownership program (ESOP) at a vastly inflated price and then kept the true value secret for years. The proposed class action lawsuit was filed last month in U.S. District Court in East St. Louis.

“Plaintiffs allege that the Casino Queen ESOP’s fiduciaries concealed for years that the ESOP transaction was intended to benefit the Casino Queen’s prior owners and executives while providing only a hollow promise to employees,” said Michelle C. Yau, a lawyer representing Henseik and Gill. “Employees learned in October 2019 that the Casino Queen stock in their retirement accounts [the only asset held in those accounts] was nearly worthless.”

None of the defendants responded to requests for comment.

The case

In 2012, the Casino Queen sold for $170 million to an employee stock ownership plan (ESOP), a trust that was supposed to guarantee retirement savings for current employees.

The transaction happened after the owners spent years unsuccessfully trying to sell the company to a third-party buyer, according to the suit.

“Given their inability to find a buyer willing to pay what the selling shareholders wanted for the Casino Queen, the selling board members created their own buyer for the company by establishing the ESOP to buy it outright,” according to the filing.

The case names the former board members of the casino, Charles Bidwill III, Timothy J. Rand, James G. Koman, Jeffrey Watson and Robert Barrows, as defendants. Bidwill, Rand and Koman all held stakes in the company at the time.

The other two, Watson and Barrows, became co-trustees of the ESOP and were charged with approving the 2012 transaction in the interest of the ESOP participants — in this case, employees of the casino — the complaint alleges.

Watson, who is now a circuit judge in St. Clair County, and Barrows were supposed to follow input from an administrative committee set up by the board of directors, which consisted of board members and officers of the company, the plaintiffs allege.

“The board retained the power to dismiss the co-trustees (who continued serving on the board while charged with approving the 2012 transaction) and administrative committee members, and thus controlled their decision-making,” according to the filing.

The plaintiffs allege the board violated their responsibilities to employees of the casino by approving $170 million in debt the ESOP took on to purchase Casino Queen stock.

The complaint also states that employees of the casino were unaware of any transaction until after it occurred and were forced to invest their employee-sponsored retirement savings into Casino Queen stock.

'Shortly after the 2012 transaction, the company stopped making employer contributions to other retirement plan(s). Instead, the company contributed solely to the ESOP which holds only Casino Queen stock, a stock that lacks a public market,' according to the filing.

The plaintiffs allege the board misled them to believe their retirement accounts were growing quickly until 2019 when employees learned the value of Casino Queen stock, the only investment in their ESOP accounts, was worth 5% of what they had been told.

Eric Schmid covers the Metro East for St. Louis Public Radio as part of the journalism grant program Report for America, an initiative of the GroundTruth Project. Follow Eric on Twitter: @EricDSchmid

Send questions and comments about this article to: feedback@stlpublicradio.org

It hasn’t been an easy past few months for Wynn Resorts. Sexual misconduct allegations against the company’s former CEO and a lawsuit for cheating to receive a gambling license has dampened what should have been an extremely successful year for the company. Fortunately, a federal judge has dismissed the recent lawsuit against Wynn Resorts.

This has to be a relief for officials within the major US casino company. Hopefully, it allows Wynn Resorts to focus more on international expansion.

Let’s look at why this company was involved in a lawsuit in the first place.

Casino Queen Esop Lawsuits

Sterling Suffolk Claims Wynn Resorts Cheated to Obtain Gambling License

Wynn Resorts is one of the most profitable gambling companies in the United States. Earlier this year, the company officially opened the Encore Boston Harbor Casino-Resort, located in Everett, Massachusetts. It proved to be immediately successful.

Unfortunately, Sterling Suffolk began alleging that the company obtained its gambling license illegally. This company, which is a partner of Mohegan Sun, filed a lawsuit against Wynn Resorts, claiming it used “unlawful methods” including kickbacks, political cronyism, and hiding allegations made against Steve Wynn.

Sterling claimed that the company corrupted the Massachusetts Gambling Commission. The company filed a lawsuit for over $1 billion in profits that Sterling would have made had they won the casino license. It was even alleged that the mayor of Everett received a concealed percentage in the casino’s ownership.

Casino Queen Esop Lawsuit Filed

Interestingly, this casino was also alleged to be cheating players. Just a few weeks after opening, an individual filed a lawsuit that claims the Encore Boston Harbor withheld full slot payments to players. Eventually, this lawsuit was dropped.

Most felt that the charges had no real merit. A federal judge now seems to agree. This lawsuit is officially being dismissed.

Judge Officially Drops Lawsuit Against Wynn Resorts

It wasn’t easy for Wynn Resorts to construct the Encore Boston Harbor. The company found itself in the middle of an FBI investigation, which found that the land which the casino would be constructed on was partially owned by an individual with ties to organized crime. Eventually, this was all resolved.

This week, US District Judge Patti Saris officially dismissed the claims against the company. She states that parts of the claim can still be continued in state court. She clearly does not support a move to allow Sterling to amend their complaint in her court again.

“The Amended Complaint was filed after Defendants moved to dismiss the initial complaint, meaning SSR already has been given one chance to cure pleading deficiencies identified by Defendants. Further, the essential facts underlying SSR’s RICO claims have been known to the public for years as a result of contemporaneous reporting and the voluminous MGC investigation reports. Therefore, the Court finds that SSR has already had a fair opportunity to plead a viable set of claims but has failed to do so,” the judge’s statement reads.

This doesn’t mean Wynn Resorts is completely out of the water. The company is still facing two additional lawsuits. These cases are still pending in MA state court. We’ll need to wait and see how everything plays out.

Steve Wynn Continues to Deny Sexual Misconduct Allegations

Casino Queen Esop Lawsuit

Steve Wynn was once considered to be one of the most powerful men in the gambling industry. In 2018, his time at the top of his industry ended. The Wall Street Journal published a story that alleges he was involved in several cases of sexual misconduct throughout his career.

Over the past several months, more allegations against Mr. Wynn have come out. In February of 2019, he officially stepped down as CEO of Wynn Resorts. Since this time, he’s avoided the public spotlight.

Steve Wynn continues to deny all of the allegations against him. He is also fighting against the NV Gaming Control Board’s attempts to push him out of the gambling industry. The former casino mogul claims that any additional punishments are unnecessary, as he already left his company.

This situation, along with the lawsuit against Wynn Resorts, has made 2019 less than ideal for the Las Vegas-based casino company. If all goes to plan, officials within the company can begin pushing to obtain a casino license in Japan.

Casino Queen Esop Lawsuit Settlements

Stay tuned for more US casino news over the next few months!