Spurned casino sues Waukegan, says city used false information to deny bid

  • Milwaukee-based Potawatomi Casino is suing the city of Waukegan, claiming aldermen used misleading information in denying its bid to build a new casino at the shuttered Fountain Square shopping center.

    Milwaukee-based Potawatomi Casino is suing the city of Waukegan, claiming aldermen used misleading information in denying its bid to build a new casino at the shuttered Fountain Square shopping center. Courtesy of the City of Waukegan

 
 
Updated 10/23/2019 7:02 PM

Potawatomi Casino is suing the city of Waukegan over the city council's decision to reject its bid to build a casino at the shuttered Fountain Square shopping center.

The city council last week sent three of four casino proposals to state regulators for further consideration, leaving out Potawatomi's bid, which promised the most jobs but offered the lowest purchase price for the city-owned site.

                                                                                                                                                                                                                       
 

The council partially based its decision on an 18-page report completed by city consultant C.H. Johnson.

Potawatomi's suit, filed this week in Lake County court, claims that report contained misleading information about its bid. The Milwaukee-based casino operator is asking a court to order the city council to reconsider its decision.

In lawsuit documents, Potawatomi argues that the consultant's report falsely said it was offering only $5.625 million to purchase the Fountain Square site at Lakehurst Road and Northpoint Boulevard. But according to Potawatomi, the proposal offered to pay the city either 15% above or 15% below the property's appraised value. It does not cite a $5.625 million figure, the suit states.

Bob Long, an attorney for Waukegan, called the suit "factually and legally invalid." He said an appraisal obtained by the city in May set the property's value at $5.625 million.

"That's why when Johnson put the report together he used that value as a benchmark," Long said. "He had no other figure to use."

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All four bids were presented to the public Sept. 11 at a meeting at the Genesee Theater.

Long said once Potawatomi's team saw the other three bids, each of which offered more than $5.625 million, company officials began sending letters and attempting to change the company's offer.

"Other (bidders) wanted to change their bid as well, but that would have been unfair," Long said. "The lawsuit's claims that we treated them unfairly is bogus. It's sour grapes."

George Ermert, a Potawatomi spokesman, said the company's legal team disputes Long's comments and intends to proceed with the litigation. The next scheduled court date is Jan. 24, 2020.

In the meantime, the three other bidders -- Full House Resorts, North Point Casino and Rivers Casino Waukegan -- will take their cases before the Illinois Gaming Board, which will make the final decision.

The Waukegan casino is part of the sweeping gambling bill passed by the legislature and signed by Gov. J.B. Pritzker earlier this year. In addition to Waukegan, the bill authorizes new casinos in Rockford, Danville, the South suburbs, downtown Chicago and downstate Williamson County.

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