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April 19, 2002
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Lac
Vieux Desert Band of Chippewa prevail in Appellate
Court:
6th US Court of Appeals sends
gambling case
back to District Court
A report from Detroit by Jean Pagano
The Lac Vieux Desert Band of Lake Superior Chippewa (the
Band) recently prevail on appeal to the 6th
US Court of Appeals in
Cincinnati over a gambling case filed back in 1997. The Lac Vieux Band
claimed
that the city of Detroit unfairly granted casino licenses to two of the
three
casinos in Detroit in the mid 1990s. The US District Court dismissed
the
tribe’s case in 1997, but the tribe appealed and the Court of Appeals
has sent
the case back to District Court in Grand Rapids, Michigan.
The Lac Vieux Band currently operates a casino in Watersmeet
in Gogebic County in the western part of the Upper Peninsula of
Michigan. In
1994, the Band, along with several of its partners, developed a plan to
bring
casino gambling to the City of Detroit. At the time the plan was
developed,
off-reservation gambling was not allowed in the state of Michigan and
the
Governor declined to move on the proposal. Not long thereafter, a
non-Native
group Atwater Entertainment and Greektown Casino also presented
a plan
for casinos in downtown Detroit and were successful in calling for a
referendum
that overturned the city’s prohibition on casino gambling. Inherent in
the new
act that allowed casino gambling was the provision that preferential
treatment
be given to petitioners that helped overturn the ban on Detroit’s
casino
gambling. It was this provision that stirred the Band to action. In
February
1997, the Band sought to have the act declared unconstitutional on the
claim
that the act impaired an exclusive contractual right; that it violated
the
takings, equal protection, and due process clauses of the federal and
Michigan
constitutions; that it violated the state constitution's prohibition
against
special legislation; and that it constituted an unlawful delegation of
legislative authority to the City of Detroit. The Band did not submit
an
application during this process.
The Band claimed that it was discouraged from filing an
application by the preferential treatment embodied in the act. The 6th
Circuit Court of Appeals agreed with the band and declared the
selection
process unconstitutional, thus sending the matter back to the District
Court.
This action effectively nullifies the selection process for setting up
casinos
in Detroit. The problem now is what to do with the already existing
casinos.
The three Detroit casinos generate about $1 billion per year. And
Detroit is financially
dependant on the revenue it receives from the casinos. Frankly, Detroit
cannot
live without the dollars that gambling brings in.
In motions recently presented to US District Judge Robert
Holmes Bell, the Band is recommending that the state should appoint a
conservator to run the three casinos and hold the profits in escrow
until
Detroit rebids the casinos. The city of Detroit has joined forces with
the
casinos, MotorCity, Greektown, and MGM, in opposing any disruption to
the
current system.
Due to the Lac Vieux Band’s former tribal chairman and
treasurer admitting to embezzling hundreds of thousands of dollars of
tribal
funds, it is unlikely that the Band would be qualified to place a bid
for any
casino, should there be any rebidding on the casinos. However
there are
a number of other tribes that would be more than willing to bid for a
piece of
the Detroit gambling pie. US District Judge Bell has taken the opinions
under
advisement and will rule at a later time. |
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