Cherry Hill Sportsbook Court Battle Winding Down

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It’s a good hint that a lawsuit is winding down — well, pending appeal anyway — when the dueling briefs get shorter.

And so it was with Cherry Hill Towne Partners, the mall developers who want to open a sportsbook on-site as soon as possible, needing just two pages on Monday to offer their reply to the former owner seeking to enforce a 20-year-old covenant against new gambling there.

This is the quirk — a deliberate quirk — in the New Jersey sports betting law that allows for more than just the state’s nine Atlantic City casinos and three racetracks to open brick-and-mortar sportsbooks and have up to three mobile “skins” as well. The “something extra” is that a site that offered horse racing in the past two decades also can open an on-site sportsbook.

It just so happens that this huge Cherry Hill shopping center is the former home of Garden State Park racetrack — and that at less than a dozen miles from Philadelphia, the affluent suburb could keep a significant amount of gambling revenue inside New Jersey state lines.

“The parties are in agreement on most points,” notes Cherry Hill Towne Partners attorney William Tambussi in Monday’s filing.

These include that the developers must apply for a racing license; that after a full year, that still hasn’t happened yet; that defendants GS Park Racing won’t have a say in the licensing process; that the decision on a license isn’t related to this lawsuit; and that the case is “ripe for adjudication” in spite of the lack of a license.

The latter was an issue raised by U.S. District Court Judge Renee Bumb last month, and both sides have scrambled since to assure Bumb that it’s time to pick a winner, basically.

“A patently false statement”

But before the judge can rule, the Cherry Hill side decided Monday that it “must address a patently false statement” it says was made by GS Park Racing.

The latter company claimed that not only was Cherry Hill evasive on whether it needed to inform the state Racing Commission of the existence of the covenant and the lawsuit, but also that such action “speaks volumes in respect of plaintiff’s bona fides.”

Not so fast, wrote Tambussi: GS Park is “simply wrong” because Cherry Hill already has agreed to disclose these issues.

Cherry Hill adds that the developer’s qualifications for a sports betting license from the Racing Commission and the state Division of Gaming Enforcement is independent of this lawsuit — and that GS Park agrees.

Therefore, says Tambussi, GS Park’s bid for a preliminary injunction should be denied because the covenant in question is”unreasonable and unenforceable”; there is no “clear and convincing evidence” that GS Park would suffer irreparable harm without the injunction; and that other factors all run in Cherry Hill’s favor.

To an outsider, this always has looked like a case where the developer and the former owner of the site might have been able to make the whole thing go away with a settlement. But it seems as if both sides expect to prevail.

Judge Bumb’s ruling — presumably coming this fall — likely will strengthen one side’s hand in negotiations.

The wild card, though, is if Bumb doesn’t find the issue “ripe” and tosses the case. If that happens, Cherry Hill — whose principal owner Jack Morris already has DGE approval via his partnership in Hard Rock casino in Atlantic City — will have to formally apply for that license that it mysteriously hasn’t gotten around to seeking.

Image courtesy of Shutterstock.com

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John Brennan

John Brennan has covered NJ and NY sports business and gaming since 2002 and was a Pulitzer Prize Finalist in 2008, while reporting for The Bergen County Record.

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