WYOMISSING, Pa. & CAMDEN COUNTY, N.J.--(BUSINESS WIRE)--Penn National Gaming, Inc. (Nasdaq: PENN) announced today that it has filed suit in Camden County, NJ, to force its joint venture partner in Freehold Raceway – Greenwood Racing, Inc. – to compel development of an Off-Track Wagering (OTW) location in that county.
Off-Track Wagering was approved in the State of New Jersey in 2001 and through a statutory “Participation Agreement” with the New Jersey Sports & Exposition Authority, Pennwood Racing, Inc., (the parent company of Freehold Raceway - “Pennwood”), a joint venture of Penn National Gaming, Inc., and Greenwood Racing, Inc., was granted the right to develop up to four OTWs in South and Central New Jersey, including Camden County. The partnership opened an OTW in Toms River in April 2008 and since opening, the facility (which employs 43 people) has generated over $40 million in annual wagering. The Toms River facility is one of three OTWs currently operating in the state.
The eight count lawsuit cites multiple breaches of fiduciary duty by the three appointed Greenwood Racing, Inc., directors who sit on the Pennwood Racing board as well as anti-trust claims under federal and state laws. Penn National Gaming, Inc. claims that since 2003, Greenwood Racing, Inc.’s appointed board members for Pennwood Racing, Inc., have used multiple delay tactics culminating in an outright refusal to develop an OTW in Camden County. Penn National believes the reason for these actions is based on Greenwood Racing, Inc.’s ownership of OTW locations in and around Philadelphia, Pennsylvania and in Vineland, New Jersey.
Eric Schippers, Sr. Vice President of Public Affairs for Penn National Gaming, Inc., said of the suit, “Greenwood has consistently worked to delay and ultimately kill a project that they knew would compete against their wholly owned OTWs. As a result of their selfish actions, the State of New Jersey and Camden County have been denied important new tax revenues and the creation of new local jobs and economic development while New Jersey’s struggling horse racing industry is missing out on potential new revenue.”
Penn National is seeking an award of damages, which could be trebled under the anti-trust laws, as well as injunctive relief directing Greenwood Racing, Inc. directors to consent to the proposal to develop a Camden County OTW.
About Penn National Gaming
Penn National Gaming owns and operates gaming and racing facilities with a focus on slot machine entertainment. The Company presently operates nineteen facilities in fifteen jurisdictions, including Colorado, Florida, Illinois, Indiana, Iowa, Louisiana, Maine, Mississippi, Missouri, New Jersey, New Mexico, Ohio, Pennsylvania, West Virginia, and Ontario. In aggregate, Penn National’s operated facilities feature over 26,300 gaming machines, approximately 400 table games, over 2,000 hotel rooms and over 959,000 square feet of gaming floor space.
In the second half of 2010, the Company plans to add table games to its facilities in West Virginia and Pennsylvania and expects to open the first video lottery terminal facility in the state of Maryland in Cecil County. Through a joint venture, Penn National is developing a full casino at Kansas Speedway in Kansas City, which is anticipated to open in early 2012, and is also developing casinos in Toledo and Columbus, Ohio, with openings targeted for the second half of 2012. Penn National has agreed to acquire Beulah Park in Ohio in a transaction expected to close in mid 2010 and has also agreed to establish a joint venture to own and operate the Maryland Jockey Club (expected to close in mid-2010), subject to regulatory and other approvals.
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Actual results may vary materially from expectations. Although Penn National Gaming, Inc. and its subsidiaries (collectively “Penn National”) believe that our expectations are based on reasonable assumptions within the bounds of our knowledge of our business and operations, there can be no assurance that actual results will not differ materially from our expectations. Meaningful factors that could cause Penn National’s actual results to differ from expectations include, but are not limited to, risks related to the following: our ability to maintain regulatory approvals for our existing businesses and to receive regulatory approvals for our new businesses; the passage of state, federal or local legislation that would expand, restrict, further tax, prevent or negatively impact operations (such as a smoking ban at any of our facilities or the results of local referenda) in the jurisdictions in which we do business or seek to do business; the activities of our competitors and the emergence of new competitors; construction factors, including delays, unexpected remediation costs, local opposition and increased cost of labor and materials; the costs and risks involved in the pursuit of those development opportunities; the availability and cost of financing; the effects of local and national economic, credit, capital market, housing, energy conditions on the economy in general and on the gaming and lodging industries in particular; the risks and delays that are customarily inherent in legal proceedings and other factors as discussed in Penn National’s Annual Report on Form 10-K for the year ended December 31, 2009, subsequent Quarterly Reports on Form 10-Q and Current Reports on Form 8-K as filed with the SEC. Penn National does not intend to update publicly any forward-looking statements except as required by law.