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FBT Everett Realty, LLC v. Massachusetts Gaming Commission (Lawyers Weekly No. 09-042-17)

COMMONWEALTH OF MASSACHUSETTS SUFFOLK, ss. SUPERIOR COURT CIVIL ACTION No. 2016-3481 BLS 1 FBT EVERETT REALTY, LLC vs. MASSACHUSETTS GAMING COMMISSION MEMORANDUM AND ORDER ON DEFENDANT’S MOTION TO DISMISS AMENDED COMPLAINT This is a claim for damages by plaintiff, FBT Everett Realty, LLC (“FBT”), arising from an alleged taking of property by the Massachusetts Gaming Commission (“Commission”). FBT’s amended complaint asserts three counts: Count II (“Per Se Taking”), Count III (“Regulatory Taking”), Count IV (“Impairment of a Contract Right”).1 All three counts claim that as a result of conduct by the Commission, FBT is entitled to compensation under either the Massachusetts Declaration of Rights or the United States Constitution, or both. The Commission moves to dismiss pursuant to Mass. R. Civ. P. 12(b)(1) and 12(b)(6). BACKGROUND The amended complaint alleges the following facts, accepted for this motion as true. FBT was the owner of a parcel of land (the “parcel”) in Everett, Massachusetts. On December 19, 2012, FBT entered into an Option Agreement with Wynn MA, LLC concerning the possible sale of the parcel to Wynn. Wynn anticipated applying for approval from the 1 Count I of the amended complaint has been dismissed, as described in the Background section of this memorandum. 1 Commission to build and operate a casino gambling facility on the parcel. Under the Option Agreement, Wynn agreed to pay FBT $ 100,000 per month for the right to purchase the parcel for $ 75 million in the event that Wynn was awarded the Category 1 destination resort casino license. The Option Agreement granted to Wynn “the option, but not the obligation, to purchase [the parcel]” from FBT. Amended Complaint, Ex A. In connection with Wynn’s application to the Commission, FBT agreed to “reasonably cooperate with [Wynn] with respect to any information it reasonably requires to complete the Casino Application and respond to any such inquiries throughout the licensing process.” Id. In November 2011, the Legislature enacted the Massachusetts Gaming Act, which is codified at G.L. c. 23K. The Act establishes the Commission as the agency to implement and regulate casino gambling. The Act, and the regulations promulgated thereunder, establish a two phase application process for a Category 1 license. The first phase is known as the “Request for Application Phase 1.” In this phase, the applicant is required to make disclosures regarding itself and affiliates. The Investigations and Enforcement Bureau (“IEB”) of the Commission then conducts an investigation of the applicant and provides findings and recommendations to the Commission regarding the suitability of the applicant and its affiliates and business associates. Only those applicants found suitable to receive a license may proceed to the second phase of the process, known as Request for Application Phase 2, […]

FBT Everett Realty, LLC v. Massachusetts Gaming Commission (Lawyers Weekly No. 12-082-17)

COMMONWEALTH OF MASSACHUSETTS SUFFOLK, ss SUPERIOR COURT CIVIL ACTION 2016-03481-BLS1 FBT EVERETT REALTY, LLC vs. MASSACHUSETTS GAMING COMMISSION MEMORANDUM OF DECISION AND ORDER ON DEFENDANT’S MOTION TO DISMISS FBT EVERETT, LLC’S COMPLAINT PURSUANT TO MASS. R CIV. P. 12(b)(1) AND 12(b)(6) Plaintiff FBT Everett Realty, LLC (FBT) entered into an Option Agreement with Wynn MA, LLC (Wynn), an affiliate of Wynn Resorts, pursuant to which Wynn acquired the option to purchase a parcel of land in Everett, Massachusetts owned by FBT (the Everett Parcel), if Wynn was awarded a casino license by the defendant Massachusetts Gaming Commission (the Commission). In this action, FTP alleges that it suffered losses as result of the Commission’s tortious interference with that Option Agreement. Its Complaint pleads a single count of intentional interference with contract in which it claims that, as a result of unlawful pressure exerted on Wynn by the Commission, Wynn insisted that FBT renegotiate the purchase price of the Everett Parcel, reducing that purchase price from $ 75 million to $ 35 million. The case is now before the court on the Commission’s motion to dismiss FBT’s complaint pursuant to Mass. R. Civ. P. 12(b)(1) and 12(b)(6). In particular, the Commission contends that it is a “public employer” under § 1 of the Massachusetts Tort Claims Act (G. L. c. 258, §§ 1 et seq., the MTCA), and, therefore, under § 10(c) it is immune from suits for intentional torts, including intentional interference with contractual relations. For the reasons that follow, the motion is 2 ALLOWED.1 1 Because theCourt concludes that the Commission is immune from suit under G. L. c. 258, § 10(c), the Court does not address the Commission’s contention that, even if the Commission were subject to such claims, the complaint fails to plead a claim for intentional interference with contractual relations on which relief may be granted. BACKGROUND The following facts are drawn from the allegations in the Complaint (assumed to be true for the purposes of this motion), the Gaming Act,the regulations promulgated pursuant thereto, and the materials attached to the Complaint. The Gaming Act and its Regulations In November 2011, the Legislature enacted the Gaming Act, which is codified at G. L. c. 23K. The Gaming Act permits casino gambling in the Commonwealth and establishes a system for regulating it. The Act establishes the Commission as the agency to implement casino gambling pursuant to the Act’s terms and regulate it. G. L. c. 23K, §§ 3(a) and 5. Among other things, the Act empowers the Commission to award a license to operate a casino with gaming tables and slot machines (the Category 1 Licenses) in each of three regions of the Commonwealth (Regions A, […]

City of Revere, et al. v. Massachusetts Gaming Commission (Lawyers Weekly No. 10-042-17)

NOTICE: All slip opinions and orders are subject to formal revision and are superseded by the advance sheets and bound volumes of the Official Reports. If you find a typographical error or other formal error, please notify the Reporter of Decisions, Supreme Judicial Court, John Adams Courthouse, 1 Pemberton Square, Suite 2500, Boston, MA, 02108-1750; (617) 557-1030; SJCReporter@sjc.state.ma.us SJC-12111 SJC-12177 CITY OF REVERE & others[1] vs. MASSACHUSETTS GAMING COMMISSION. Suffolk. December 5, 2016. – March 10, 2017. Present: Gants, C.J., Botsford, Lenk, Hines, Gaziano, Lowy, & Budd, JJ. Gaming. License. Administrative Law, Judicial review, Intervention. Practice, Civil, Action in nature of certiorari, Review of administrative action, Intervention, Interlocutory appeal. Jurisdiction, Judicial review of administrative action. Civil action commenced in the Superior Court Department on October 16, 2014. A motion to dismiss the intervener’s complaint and a motion to dismiss the plaintiffs’ second amended complaint were heard by Janet L. Sanders, J. The Supreme Judicial Court granted an application for direct appellate review, and following the order by Sanders, J., for entry of final judgment, the Supreme Judicial Court granted a second application for direct appellate review. Kenneth S. Leonetti & Christopher E. Hart (Michael Hoven also present) for the intervener. Patricia L. Davidson for city of Revere. David S. Mackey (Mina S. Makarious & Melissa C. Allison also present) for the defendant. BOTSFORD, J. This case concerns the process by which the Massachusetts Gaming Commission (commission) awarded a gaming license in late 2014 to Wynn MA, LLC (Wynn). The plaintiffs — an unsuccessful applicant for the license, the city that would have hosted the unsuccessful applicant, a labor union, and individual citizens — filed two complaints in the Superior Court that alleged numerous defects in the commission’s process for awarding the license to Wynn. The commission filed motions to dismiss both complaints. A judge in the Superior Court allowed the motions on all but one count of one of the complaints, permitting only the unsuccessful applicant’s claim for certiorari review to survive. The parties now appeal various aspects of the judge’s decision. For the reasons discussed below, we affirm in part, reverse in part, and remand the case for further proceedings. Background. 1. Gaming in Massachusetts. In November, 2011, the Legislature enacted St. 2011, c. 194, An Act establishing expanded gaming in the Commonwealth (act).[2] Section 16 of the act created the gaming commission and set forth standards under which applicants could obtain a license from the commission to operate a gaming establishment. See G. L. c. 23K, inserted by St. 2011, c. 194, § 16. The act describes two types of licenses. The one […]