Cherry Hill Sportsbook Backers Say An Operator Deal Is Pending

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Three weeks ago, a federal judge asked a would-be Cherry Hill sportsbook operator, to, in layman’s terms, explain why she should even bother considering their lawsuit over their right to open a sportsbook.

On Monday, that company tried to provide the requested answers — and in doing so, clarified a rough timetable of when the first bets might be taken.

U.S. District Court Judge Renee Bumb’s concern was that it was unclear what licenses would be required, whether an application had been submitted, if so what the status was, and so forth. Adding it all up, Bumb asked, “Is this case ripe for adjudication?”

Cherry Hill Towne Center Partners (CHTC), which owns the land that was the site of the former Garden State Park racetrack, is permitted to open a sportsbook there per state law — unless a 20-year-old “restrictive covenant” stops them.

The first point made by CHTC is that Jack Morris, a leading owner of the strip mall that would include the sportsbook, is a part-owner of Hard Rock Casino in Atlantic City. This is an important point because, as the filing notes, it means that “Mr. Morris submitted all necessary applications and the [state Division of Gaming Enforcement]conducted a complete investigation of his application.”

Morris “passed the audition,” so to speak, which greatly accelerates the potential timetable for opening that sportsbook that the filing says Morris is “actively pursuing.”

That includes securing local permits, having the DGE conduct a preliminary site investigation, and the beginnings of a “buildout” for the sportsbook.

Also of note is that Morris and his partners are “in active discussions with two sports wagering operators, both of which are fully licensed by NJDGE and currently are operating sports wagering facilities in New Jersey. [CHTC] expects to select one of the potential sports wagering operators shortly.”

Timetable talk

It sounds like CHTC has some wheels in motion, but back to the core question: Has CHTC even applied for a license yet?

No, according to the filing. But Morris says that he and his partners “are prepared to file its initial application for a sports wagering license with the New Jersey Racing Commission as soon as possible after the selection of the operator, and the renewal application will be submitted to [the DGE]shortly thereafter.”

Given that Morris and the pending sportsbook operator already have attained the DGE imprimatur, the process of obtaining a license would take “approximately 90 to 120 days.” That’s roughly late October to late November, so even the best-case scenario doesn’t have the sportsbook opening until late in football season.

But the new information also suggests that a favorable court ruling presumably brings the sportsbook to fruition in months, not years.

The filing also makes a case that Greenwood Racing and its partners — who are battling to prevent operation of the sportsbook — have no right, based on precedent, to intervene in Morris’ application to the racing commission.

Three issues to contend with

Next up is a defense of why this case is “ripe for adjudication” in spite of the lack of an application. What’s not explained is why the application has not already been made.

The first issue is “the adversity of the parties’ interests.” In this case, Morris and his partners intriguingly claim CHTC already has suffered “a real and substantial threat of harm” because “to the extent that a potential purchaser or tenant has an expectation that Plaintiffs’ property can be used for sports wagering, the property becomes more valuable.”

Step 2 is “the conclusiveness of the judgment.” That means, according to the filing, “this case presents a straightforward legal issue: whether or not the [restrictive covenant]is enforceable.”

The third issue is “the utility of the judgment.” In this case, it’s what happens once a judge makes a decision. Here, the filing points out that if Morris and his partners are found not to be able to move forward, they may have to surrender.

The reason this case came about in the first place has to do with the covenant established in 1999, two years before the track closed, that barred “horse racing, simulcasting, off-track betting, wagering activities and gambling and gaming of any sort (collectively, ‘Gaming’) anywhere on the GSP Property” by anyone other than the former track owners.

That would be Pennwood — the joint venture between Greenwood and Penn National Gaming that happens to own Freehold Raceway, which, along with Caesars in Atlantic City, are the only racetracks or casinos that have yet to jump into launching sports betting.

To add more intrigue, Greenwood owns Parx Casino near Philadelphia as well as the South Philadelphia Turf Club, leading the would-be Cherry Hill sportsbook to claim that all this talk about covenants is merely a ruse to allow Greenwood to claim more market share in the Philadelphia-South Jersey suburbs region.

The first anniversary of this case is coming up, and a resolution seems like it could be no more than a month or two away.

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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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