The City of Springfield, Massachusetts, has filed a lawsuit against MGM Resorts International for alleged breaches of its casino host agreement. This has led MGM to accuse city officials of obstructing its efforts to sell MGM Springfield to another operator.
The lawsuit, filed in Hampden Superior Court, claims MGM and its subsidiary, Blue Tarp Redevelopment, have not upheld commitments regarding employment, the size of the gaming floor, and the redevelopment of a downtown property.
In response, MGM labeled the lawsuit as “frivolous” and accused Mayor Domenic Sarno’s administration of delaying approval of the casino sale. MGM informed city representatives of the proposed transaction in early 2024 and shared details about a potential buyer and their plans for the property.
MGM described the buyer as a qualified casino operator who vowed to honor the Host Community Agreement after the transfer.
Sales Discussions
Rumors of a potential sale of the Springfield property surfaced in March 2024. A meeting between Sarno and MGM CEO Bill Hornbuckle took place the following month to discuss the matter.
During this time, the city emphasized that any new operator taking over would need to abide by MGM’s commitments under the Host Community Agreement.
MGM provided more insights into the progress of these discussions, revealing the identification of a prospective buyer and their plans for the casino.
MGM claimed the buyer agreed to convert 101 State Street into a hotel, despite this being the costliest option discussed. However, the city officials allegedly stalled the discussions.
The city is accused of trying to impede the transaction through delays, according to MGM.
Springfield Allegations
On the other hand, Springfield officials stated that they spent nearly two years negotiating with MGM over alleged breaches of the 2013 Host Community Agreement without resolution.
Among the claimed breaches, the city highlighted MGM’s failure to maintain the required number of employees and gaming machines, as well as not refurbishing 101 State Street for seven years.
City Solicitor Stephen Buoniconti explained that the lawsuit was necessary after failed attempts to settle the dispute through discussions.
MGM and Blue Tarp have requested private arbitration, while the city argues that the dispute falls outside the arbitration clauses and should be decided by a court.
MGM Springfield, which cost around $960 million, opened its doors in August 2018.