- About Us
- Local Savings
- Green Editions
- Legal Notices
- Weekly Ads
Connect with Us
Snoqualmie casino ownership dispute now in bankruptcy court
SNOQUALMIE VALLEY - The companies formed to help the Snoqualmie Tribe build a casino outside Snoqualmie filed for bankruptcy last week in Arizona, but the question of who operates that company still remains.
A bankruptcy petition for the MGU companies, which were formed to help the Tribe build a casino, was filed in a federal district court in Phoenix on April 7. The petition was for a chapter 11 filing, which means the company filed for it voluntarily.
The move came just before a hearing was scheduled this week regarding the ownership of the MGU companies, which were created to build a $70-million, 150,000 square-foot casino on a 54-acre parcel of land north of North Bend Way and west of 384th Avenue. The project is still awaiting approval by the federal Bureau of Indian Affairs (BIA).
In November 2004, MGU president Thomas LeClaire filed a lawsuit in Maricopa County Superior Court in Arizona. In the lawsuit LeClaire asked that a ruling be made on who runs MGU; the man who put all the money into it, Jerry Moyes, or one of Moyes' former business associates, Jim Miller. Moyes funded the creation of MGU with $16 million of his own money in loans and financial commitments to be used to build the Snoqualmie casino.
Moyes had placed Miller in charge of MGU until issues Moyes had with being involved in gambling were resolved. Moyes owns the Phoenix Coyotes hockey team and used to own part of the Arizona Diamondbacks baseball team. Baseball rules prohibit Moyes from being involved in gambling, and hockey rules prohibit him from participating in sports gambling. Snoqualmie Tribal Administrator Matt Mattson said those are no longer issues since the Snoqualmie casino would not have sports gambling and Moyes had divested his share of the Diamondbacks baseball team.
In 2003, LeClaire was appointed to be president of the MGU companies, but Miller was still an employee. Mattson said there was some kind of falling out, however, last year between Miller and Moyes, and now there is a question of who actually owns MGU, although the bankruptcy petition was filed under Miller's direction last week.
A press release sent out earlier this week by the Tribe said that Moyes alleged that Miller defrauded him by arranging the legal paperwork of the MGU companies to show Miller as the owner. The release also said that Miller has claimed Moyes transferred the MGU companies to Miller's name because of Miller's experience and skill managing casino projects.
As for validity of the bankruptcy claim, Mattson said in a statement that MGU has so far met all its contractual obligations with the Tribe. He said that the bankruptcy lawsuit may have more to do with the ownership lawsuit than with the actual financial standing of the MGU companies since bankruptcy petitions can stall other legal proceedings concerning the companies involved in such a suit. The ownership hearing has been put off until April 22.
"At this point, it is unclear to the Tribe whether the MGU companies will be accepted into bankruptcy. There is substantial reason to view this attempt to take the companies into bankruptcy as a legal maneuver in the context of the dispute over ownership of the MGU companies," he said. "Unless or until the MGU companies are able to meet its contractual obligations, the Tribe will stand behind its business arrangement and continue to press forward in its efforts to obtain final approval from the BIA so that the Tribe can finally realize its goal and aspiration of economic self-sufficiency."
Miller's attorney Dale Schian said the filing does not necessarily reflect the financial status of the MGU companies, but rather a desire to reorganize. Under chapter 11, a company can continue to operate while it reorganizes how it is structured. Miller has the power to do that, Schian said, since he has control of MGU.
"Mr. Miller is the owner of those [MGU] companies," he said.
LeClaire and Moyes both did not return calls to the Valley Record, but Will Rafferty, a spokesman for LeClaire, said Moyes stands behind MGU.
Schian said the schedule for the bankruptcy case is still being worked out but that a meeting of creditors should occur sometime next month.