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Caesar's confirms withdrawal of application as qualifier in Massachusetts

Caesars Entertainment holds a minority ownership, and has a management agreement related to operating a casino, with Sterling Suffolk Racecourse, owner of Suffolk Downs racecourse in East Boston, Massachusetts. Sterling Suffolk recently made a bid for a casino license at its facility. On October 18, Caesars received a report issued to the Massachusetts Gaming Commission from the Director of the Investigations and Enforcement Bureau for the Massachusetts Gaming Commission which raised certain issues for consideration when evaluating Caesars' suitability as a qualifier in Massachusetts. In particular, the director primarily cited Caesars' business relationship related to a license agreement for branding of a hotel that was entered into in 2013, and recently terminated. In addition, the report noted matters related to the CEO of Caesars Acquisition Company, who has been an employee of a subsidiary of the Caesars since 2009. All matters raised by the director with respect to the CEO of Caesars Acquisition Company relate to his employment by public companies in the internet gaming industry which occurred prior to his employment with the Caesars and are part of the public domain. The director also cited the Caesars' financial condition as a factor, although the report does state that the director believes that the company currently demonstrates the requisite financial stability for licensure in Massachusetts. The recommendation of the director to the Massachusetts Gaming Commission was that the company has not met its burden by clear and convincing evidence to establish its suitability. Although Caesars strongly disagrees with the director’s recommendation, the company has decided to withdraw its application as a qualifier in Massachusetts for the benefit of Sterling Suffolk. Caesars notes that neither it nor its affiliates have been found unsuitable by any licensing authority. This matter related to the finding of an investigation that was delivered to a licensing authority, which has not made any findings. The company added, "all but one of the issues raised by the Bureau, the license agreement for branding of a hotel, relate to circumstances that are at least several years old, and, to date, have not been the subject of a finding of unsuitability. Nonetheless, in light of these recent events, the (company) cannot assure you that existing or future jurisdictions would not raise similar questions with respect to the (company’s) suitability, and the (company) cannot assure you that such issues will not adversely affect it or its financial condition."