Court upholds Tropicana decision

ATLANTIC CITY — The former owners of the Tropicana Casino and Resort “lacked financial integrity and responsibility, as well as business ability,” and deserved to be stripped of their casino license, the New Jersey Supreme Court ruled unanimously on Tuesday.

The unusually quick decision, coming just eight days after the high court heard oral arguments in the case, clears the way for a state-appointed trustee to sell the troubled gambling hall in a bankruptcy court auction.

Tropicana Entertainment LLC had appealed the license denial to the Supreme Court, alleging, among other things, political interference by state Senate President Dick Codey. Codey wrote a letter to the Casino Control Commission urging that a casino workers union be allowed to participate in the renewal hearings. The letter did not ask for a specific outcome regarding the Tropicana’s license.

The commission denied the request, and said it would not consider Codey’s letter in its decision.

The justices found many reasons to support the commission’s decision to deny the Tropicana a license.

The former owners cut nearly 1,000 jobs, leading to problems with cleanliness, service and compliance with state gambling regulations. Among complaints by customers were infestations of bedbugs and roaches in hotel rooms, filthy floors, and dust so thick on drapes and TV screens that guests could write their name in it.

“The massive staff layoffs, the turnover in senior management accompanied by their replacement with personnel with less extensive casino management experience, the cleanliness crisis experienced in the late winter-spring 2007, the regulatory violations directly related to inadequate staffing, and the failure to recognize the immediate need for a conforming independent audit committee, and the intransigence in adopting a conforming committee, all attest to the ultimate conclusion that the Tropicana AC license should not have been renewed,” the court wrote.

Casino commissioner Linda Kassekert welcomed the decision.

“It reinforces our position that the decision was clearly based on the record developed before us, and not on any external factors,” she said.

The ruling didn’t surprise Scott Butera, chief executive officer of Tropicana Entertainment LLC.

“We kind of knew it was a long shot,” he said, adding an appeal to the U.S. Supreme Court is unlikely.

He said the company remains committed to other efforts to regain control of the casino, including a petition it has filed with the casino commission. The petition lays out management and operational changes the company has made since losing its license, particularly the removal of owner William Yung III from any role in its operations, and asks for a determination that the company is once again qualified to hold a casino license.

No date has been set for consideration of that request.

The casino has remained open since the license denial, under the supervision of a trustee, retired state Supreme Court Justice Gary Stein. Interim management has made strides toward improving conditions at the casino and hotel, including hiring back about 150 of the customer service workers that previous management had laid off.

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