Lawsuit Coming Over Vanderbilt Casino

Dec 21, 2010

An Indian tribe in Harbor Springs plans to file a lawsuit tomorrow to try to shut down a small casino in Vanderbilt.

The Bay Mills casino has been open, despite an order to close that came late last week from the state Attorney General.

"We'll be asking for a temporary injunction to close the Bay Mills Indian Community casino in Vanderbilt down because we feel it's illegal," says Chairman Ken Harrington, of the Little Traverse Bay Bands of Odawa Indians.

An injunction would shut down the casino temporarily, as the question of its legality is weighed in court. Harrington says that could take years.

The casino opened quietly last month, bypassing the traditional state and federal approval processes. It's owned by the Bay Mills Indian Community.

Chairman Jeff Parker said in a statement Monday that his tribe wouldn't have opened the casino if it wasn't sure the Vanderbilt operation is legal. He says the tribe is prepared to defend that position in court.

There's no word on the next move from the state, with the casino remaining open despite orders to close.

Meanwhile, the same tribe that's filing the lawsuit says it still plans to withhold payments to the state. At issue is millions of dollars that normally go to state coffers.

The Little Traverse Bay Bands runs the Odawa Casino Resort in nearby Petoskey. Under a compact with Michigan, the tribe is supposed to share its casino revenues with the state.

But Harrington says the tribe no longer has to do that because of a breach of contract. He says the state should have shut down the Vanderbilt casino immediately when it opened last month, but Michigan didn't have a process in place for doing so.

"It is a violation of our compact and therefore, you know, we cannot pay this money," Harrington says. For now, the money is sitting in escrow.

An attorney for Governor Granholm says the state has not broken its agreement with the tribe, saying 38 slot machines in Vanderbilt is too small an operation to be considered competition for the Odawa Casino Resort.

The compact includes a non-compete clause, but only for commercial gaming facilities that are more than double that size.

Nonetheless, Harrington says his lawyers have been looking over the document, and they believe the state has failed to keep its end of the compact.