Pa. Supreme Court orders new look at Philly casino project

In a decision that may further delay the opening of a second casino in the city, the Pennsylvania Supreme Court on Tuesday ordered gambling regulators to take another look at Stadium LLC’s application to build a hotel and casino complex in South Philadelphia.

The court, in a unanimous opinion, said the state Gaming Control Board had not sufficiently examined whether Stadium LLC’s proposal had breached state rules limiting investor ownership in multiple casinos. The ruling marked the second time in 15 months that the state’s highest court sent the issue back to casino regulators.

SugarHouse HSP Gaming L.P., operator of the SugarHouse casino, which had challenged Stadium LLC’s application, declined to comment on the decision.

Cordish Cos. of Baltimore, a partner in the Stadium project, did not respond to calls for comment.

In a statement, the Gaming Control Board said that it “appreciates the work of the court in producing this decision and is reviewing to determine the next steps in this matter. We do know that at this juncture, the court has determined that the license cannot be issued until the board proceeds on matters addressed in the ruling.“

Stadium plans to build a $450 million complex at a Holiday Inn site at Ninth Street and Packer Avenue in the city’s stadium district, with a 2,600-car garage, a 200-room hotel, 2,000-plus slot machines, more than 100 table games, and other features.

Stadium’s Live! Hotel & Casino project initially won the Gaming Control Board’s approval in 2014, and soon after won the support of the city Planning Commission as well as community organizations.

The project is a joint venture of Cordish and Greenwood Gaming & Entertainment Inc., which owns Parx Casino in Bensalem. In its earlier opinion, the Supreme Court said the gaming board had failed to scrutinize whether Greenwood’s primary backer, Watche “Bob” Manoukian, would have an ownership interest exceeding the 33.3 percent limit imposed by state law.

Manoukian, an Armenian born in Lebanon who made a fortune as an agent for the royal family of Brunei, owns 85.84 percent of Parx, and his ownership in a second casino in Philadelphia would be subject to legal limits.

The state Supreme Court’s first decision on the matter, issued March 29, 2016, sent Stadium’s application back to the gaming board for further examination of whether Manoukian would exceed permissible ownership interests. In its second review, the board concluded that Manoukian’s interest was within the legal limits.

But both SugarHouse and Market East Associates, another casino-license applicant, challenged the board. SugarHouse argued that it had been improperly barred from participating in the review, and Market East Associates said that Manoukian’s interest had not been adequately evaluated. On those counts, the court agreed with both appellants.