ILNews

COA sides with Lauth in casino suit

Michael W. Hoskins
January 1, 2008
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Indianapolis commercial developer Lauth didn't breach a joint venture contract or any of its duties with other parties by partnering with the Bloomington-based Cook Group on an Orange County riverboat casino project, the Indiana Court of Appeals ruled today.

In a unanimous holding in Lauth Indiana Resort & Casino LLC v. Lost River Development LLC, et al., 29A02-0710-CV-839, the court ruled on an issue of first impression about when a joint venture terminates in situations where the agreements contain no specific termination date, creating a bright-line rule as it reversed a ruling from Hamilton Superior Judge Steven Nation that determined there was an issue of fact about whether Lauth had violated the agreement and that a jury should decide that issue.

This case stems from the construction of an Orange County riverboat casino project starting in 2004. Three companies submitted original proposals - Trump Indiana Casino Management, Orange County Development affiliated with Larry Bird, and Lost River that was formed by Merit Gaming Group. After Lost River submitted its proposal, Lauth contacted the developer and they formalized an agreement that provided Lauth would have 50 percent ownership to create a joint venture.

The Indiana Gaming Commission debated between the Trump Indiana and the Lost River/Lauth proposal, ultimately deciding on Trump Indiana. Lauth started contacting other gaming companies and developers to see if anyone would partner with them in case Trump didn't come through; Lauth eventually partnered with the Cook Group to submit another proposal under the name Blue Sky Casino LLC. They won the bid, and the casino opened in Nov. 1, 2006.

As the project was ongoing, Lost River and Merit filed a complaint in late 2005 against Lauth and the Cook Group and alleged they'd entered into an enforceable contract for a joint venture and that, by teaming with Cook Group to form Blue Sky, the Indianapolis developer breached the contract.

Lauth filed a motion for summary judgment in June 2006 claiming that the agreement formed a joint venture at most and that it was terminated when the Gaming Commission chose Trump over Lost River's proposal. At the trial level, Judge Nation dismissed that motion, finding that it didn't contemplate a second bid proposal and that federal caselaw says that a formed joint venture agreement generally "remains in force until its purpose is accomplished or that purpose becomes impracticable."

The Court of Appeals disagreed, and its ruling gives guidance as to when a joint venture agreement ends if nothing is written or specifically detailed about how it ends.

"In conclusion, we hold that if a joint venture is formed for the purpose of submitting a proposal or similar bid, and the joint venture agreement is silent as to when or under what circumstances that venture will end, then the joint venture ends when the proposal or bid is rejected," the court wrote.

In this case, the Lost River joint venture ended as a matter of law when the IGC chose Trump Indiana. As a result, Lauth didn't breach the agreement and the trial judge erred in denying Lauth's motion for summary judgment, the appellate court said.

The case is remanded.
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  1. From his recent appearance on WRTV to this story here, Frank is everywhere. Couldn't happen to a nicer guy, although he should stop using Eric Schnauffer for his 7th Circuit briefs. They're not THAT hard.

  2. They learn our language prior to coming here. My grandparents who came over on the boat, had to learn English and become familiarize with Americas customs and culture. They are in our land now, speak ENGLISH!!

  3. @ Rebecca D Fell, I am very sorry for your loss. I think it gives the family solace and a bit of closure to go to a road side memorial. Those that oppose them probably did not experience the loss of a child or a loved one.

  4. If it were your child that died maybe you'd be more understanding. Most of us don't have graves to visit. My son was killed on a state road and I will be putting up a memorial where he died. It gives us a sense of peace to be at the location he took his last breath. Some people should be more understanding of that.

  5. Can we please take notice of the connection between the declining state of families across the United States and the RISE OF CPS INVOLVEMENT??? They call themselves "advocates" for "children's rights", however, statistics show those children whom are taken from, even NEGLIGENT homes are LESS likely to become successful, independent adults!!! Not to mention the undeniable lack of respect and lack of responsibility of the children being raised today vs the way we were raised 20 years ago, when families still existed. I was born in 1981 and I didn't even ever hear the term "CPS", in fact, I didn't even know they existed until about ten years ago... Now our children have disagreements between friends and they actually THREATEN EACH OTHER WITH, "I'll call CPS" or "I'll have [my parent] (usually singular) call CPS"!!!! And the truth is, no parent is perfect and we all have flaws and make mistakes, but it is RIGHTFULLY OURS - BY THE CONSTITUTION OF THIS GREAT NATION - to be imperfect. Let's take a good look at what kind of parenting those that are stealing our children are doing, what kind of adults are they producing? WHAT ACTUALLY HAPPENS TO THE CHILDREN THAT HAVE BEEN RIPPED FROM THEIR FAMILY AND THAT CHILD'S SUCCESS - or otherwise - AS AN ADULT.....

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