Northeast Gaming of Palmer sues Peter Picknelly, Penn National Gaming over Springfield casino deal
Penn National Gaming introduces their plans for a Springfield casino during a gala event at the Paramount Theater in downtown Springfield on Dec. 20, 2012. Shown here at the event are from left, Peter A. Picknelly, chief executive officer of Springfield-based Peter Pan Bus Lines; Peter M. Carlino, CEO of Penn National; and football celebrity Doug Flutie. (Republican Staff photo by Don Treeger)
By on February 07, 2013
A local real estate group hoping to see its land become the site of the sole Western Massachusetts casino has filed a lawsuit against Penn National Gaming and Springfield businessman Peter Picknelly, alleging that he breached a contract with them by partnering to push another casino site.
Northeast Gaming Group Inc., an associate of Northeast Realty which owns the land in Palmer where Mohegan Sun hopes to build, is claiming its business plan was hurt when Picknelly walked away from a deal to partner with Penn National Gaming to develop a casino in the northern edge of downtown Springfield.
The lawsuit reiterates what Northeast Gaming's lawyer, Stephen Spelman said last month when he called on Picknelly to honor his original contract with the Palmer developers.
"Mr. Picknelly betrayed the Palmer venture by actively working against it with Penn National Gaming, even though at the same time he continued to keep his interest in the Palmer project," Spelman wrote in an email.
In 2008, Picknelly invested $500,000 in the Palmer group's venture and signed an agreement to give him a return on that investment of three percent of the group's net revenues from the development of the gaming, entertainment and retail complex, the lawsuit states.
A key point of contention to be settled by the courts is whether the revenue-sharing agreement constitutes a partnership, like Northeast Gaming alleges, or not.
The lawsuit also claims that Picknelly pushed Northeast Realty's manager Leon Dragone of Longmeadow to grant him a significant role in the venture, particularly a larger stake than his brother Paul held, prior to Paul Picknelly's move to team with MGM Resorts International to develop a casino in Springfield's South End.
The lawsuit contends that on Oct. 11, when Penn National announced its partnership with the CEO of Peter Pan Bus Lines, to develop a casino on land including the site of The Republican newspaper, he violated his original agreement by helping a direct competitor for the sole casino license.
Penn National Gaming is also listed as a defendant in the lawsuit for its alleged role as a partner with Peter Picknelly and the purported affect it had on the Palmer group's business proposition to build a rural casino.
One of Picknelly's lawyers, Michael Callan, said the lawsuit was "frivolous" and that they plan to file a counter-suit.
"This is extortionate and some of the most egregious charges in their lawsuit are based on a third-party's statements," Callan said. "It is outrageous, the slanderous things they are saying about Peter Picknelly. And for them to try to re-frame the revenue-sharing agreement as a partnership agreement is a cheap shot bordering on the unprofessional. We are not concerned about the claims made in this lawsuit at all."
Eric Schippers, senior vice president for public affairs at Penn National Gaming, added "To continue to press forward with such a frivolous case is unfortunate, and is a clear sign that this group has zero confidence in their ability to compete fairly for the Western Massachusetts casino license. As we've said before, we have thoroughly reviewed the matter and the underlying agreement, and find the claims to be without any legal merit whatsoever."
A copy of the lawsuit, as filed Thursday in Hampden Superior Court, can be seen below.
NE Gaming Group v Peter Picknelly and Penn Nat'l Gaming Complaint
http://www.masslive.com/politics/index.ssf/2013/02/peter_picknelly_sued_by_palmer.html
Northeast Gaming Group Inc., an associate of Northeast Realty which owns the land in Palmer where Mohegan Sun hopes to build, is claiming its business plan was hurt when Picknelly walked away from a deal to partner with Penn National Gaming to develop a casino in the northern edge of downtown Springfield.
The lawsuit reiterates what Northeast Gaming's lawyer, Stephen Spelman said last month when he called on Picknelly to honor his original contract with the Palmer developers.
"Mr. Picknelly betrayed the Palmer venture by actively working against it with Penn National Gaming, even though at the same time he continued to keep his interest in the Palmer project," Spelman wrote in an email.
In 2008, Picknelly invested $500,000 in the Palmer group's venture and signed an agreement to give him a return on that investment of three percent of the group's net revenues from the development of the gaming, entertainment and retail complex, the lawsuit states.
A key point of contention to be settled by the courts is whether the revenue-sharing agreement constitutes a partnership, like Northeast Gaming alleges, or not.
The lawsuit also claims that Picknelly pushed Northeast Realty's manager Leon Dragone of Longmeadow to grant him a significant role in the venture, particularly a larger stake than his brother Paul held, prior to Paul Picknelly's move to team with MGM Resorts International to develop a casino in Springfield's South End.
The lawsuit contends that on Oct. 11, when Penn National announced its partnership with the CEO of Peter Pan Bus Lines, to develop a casino on land including the site of The Republican newspaper, he violated his original agreement by helping a direct competitor for the sole casino license.
Penn National Gaming is also listed as a defendant in the lawsuit for its alleged role as a partner with Peter Picknelly and the purported affect it had on the Palmer group's business proposition to build a rural casino.
One of Picknelly's lawyers, Michael Callan, said the lawsuit was "frivolous" and that they plan to file a counter-suit.
"This is extortionate and some of the most egregious charges in their lawsuit are based on a third-party's statements," Callan said. "It is outrageous, the slanderous things they are saying about Peter Picknelly. And for them to try to re-frame the revenue-sharing agreement as a partnership agreement is a cheap shot bordering on the unprofessional. We are not concerned about the claims made in this lawsuit at all."
Eric Schippers, senior vice president for public affairs at Penn National Gaming, added "To continue to press forward with such a frivolous case is unfortunate, and is a clear sign that this group has zero confidence in their ability to compete fairly for the Western Massachusetts casino license. As we've said before, we have thoroughly reviewed the matter and the underlying agreement, and find the claims to be without any legal merit whatsoever."
A copy of the lawsuit, as filed Thursday in Hampden Superior Court, can be seen below.
NE Gaming Group v Peter Picknelly and Penn Nat'l Gaming Complaint
http://www.masslive.com/politics/index.ssf/2013/02/peter_picknelly_sued_by_palmer.html
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