Narragansett Tribe Sued by Former Partners

As reported by the Providence Journal: "The shareholders of a former casino company that once partnered with the Narragansett Indian Tribe have gone to court seeking $10 million from the tribe.

"The shareholders of the former Capital Gaming International Inc. say that the tribe's promised cut from new video slot machines at Lincoln Park triggers an agreement the tribe had made with the gambling company in 2001.

"That agreement states that if the tribe moves forward with another gambling project in Rhode Island, it must first pay back Capital for development expenses the company incurred here.

"From 1993 to 1999 Capital Gaming was working with the tribe to bring a casino to Rhode Island. In the fall of 1999, the tribe dropped the financially ailing Phoenix, Ariz., company in favor a new partner, Boyd Gaming Corp., of Las Vegas. The tribe later dropped Boyd for its current partner, Harrah's Entertainment.

"Capital Gaming threatened legal action if the tribe did not make arrangements to repay $9.9 million in 'development loans' and buy out its management contract. The two sides reached a settlement on April 2, 2001.

"…As of this afternoon, the tribe had not officially responded to the governor's office and no money has been transferred, according to Carcieri's spokesman Jeff Neal…"

2006-09-14