DES MOINES, Iowa (AP) – The Iowa Court of Appeals on Wednesday upheld a judge’s dismissal of a lawsuit filed by the owners of the shuttered Argosy casino in Sioux City, settling a longstanding dispute over who has the right to operate a casino there.
The court concluded the Iowa Racing and Gaming Commission acted properly in 2013 when it decided to grant a gambling license to the land-based Hard Rock casino and reject an application by the owners of the Argosy riverboat casino.
Argosy was owned by the Belle of Sioux City, a subsidiary of Penn National Gaming Co.
The commission denied Argosy owners a license in April 2013 after the company failed to renegotiate an operating contract with the Missouri River Historical Development, a local nonprofit group that holds the state gambling license for Woodbury County.
Iowa law requires casino licenses to be held by local nonprofit organizations that promise to share a percentage of profits with local governments and community-based groups. Casino operators, often large gambling corporations, contract with the nonprofit license holder to operate the casino.
The dispute between Argosy and its nonprofit partner led the commission to seek other proposals for a new Sioux City casino.
Even though Argosy eventually partnered with a different nonprofit and proposed to build a new casino, the commission chose to award the license to Missouri River Historical Development and a new casino company it contracted with to build a proposed $128 million Hard Rock Hotel and Casino.
The commission ordered the Argosy to close by July 2014.
Argosy challenged the commission’s decision in court, saying it was inconsistent and denied the company its constitutional due process rights.
The appeals court, upholding a Polk County judge’s decision, said Argosy did not have a valid license to operate a casino as a result of the dispute with its nonprofit partner. The court also concluded the gambling commission “has discretion in deciding to whom it awards a gambling license and which licenses it renews.”
The court found the Argosy operators’ constitutional due process rights were not violated because the company sought several hearings before the commission and the courts and each time its arguments were heard.
The Argosy, which had operated since 2003, closed July 30, 2014 and the Hard Rock casino opened two days later.
The Argosy owners’ attorney, Mark Weinhardt, had no immediate comment on the court’s ruling.
Copyright 2016 The Associated Press.
