Chicago casino: Firm that advised Lightfoot also represented winning bidder

Fatima Fokina

It is not clear when the firm’s representation of Bally’s began or whether it handled some or all legal matters when Bally’s acquired the western Illinois facility, then known as Jumer’s, last year.

But news of the dual role comes as the City Council prepares to vote Wednesday on Mayor Lori Lightfoot’s recommendation that Bally’s be selected to own and operate a $1.7 billion casino complex in River West, on what is now Chicago Tribune printing plant property at Halsted Street and Chicago Avenue.

Neither the city nor Cezar “Cid” Froelich, the Taft gaming-law partner who worked on the Chicago bid for several months, had any comment. But one alderman who opposes the proposed location, Brian Hopkins, 2nd, had plenty to say, terming it “outrageous” that aldermen were not informed of what he termed “a clear conflict of interest.”

“So our lawyer was working for the winning applicant?” said Hopkins. “This is a typical insider deal in classic City Hall fashion.”

Taft’s involvement has a certain resemblance to that of another top city consultant in the casino process, Union Gaming, whose analytics division’s revenue projections the Lightfoot administration relied on to declare that Bally’s was offering the city the best deal even though another unit of the same company served as co-manager last year on a $696 million Bally’s stock offering.

City officials have not said whether they were aware of the connection but have asserted that such companies keep “an iron wall” between different divisions to avoid conflicts.

Officials have insisted their only goal in selecting Bally’s is to get the most money and other benefits for the city to help shore up cash-short city pension funds, but in fact the city’s own analysis of the final bids showed that another competitor—Rush Street Gaming at The 78 site in the South Loop—promised more jobs than Bally’s and potentially more tax revenue.

Nevertheless, organized labor is strongly behind the Bally’s plan and has been lobbying aldermen to support the proposal. A measure authorizing the agreement was approved by a council committee Monday and is expected to come up for a council vote Wednesday.

If the council approves, the matter then will go to the Illinois Gaming Board for final action. 

9:30 P.M. UPDATE:

The mayor’s office is out now with a statement. Here it is in full:

Taft has only represented the city of Chicago in this transaction and has represented the city for over a decade on gaming matters.

As is common industry practice, advisory firms enforce internal conflict policies by creating walls to protect against such conflicts, especially when engaged to create an RFP process because they do not know who may ultimately bid. Because of Taft’s robust gaming practice, Taft divided its practice into two distinct groups many years ago to protect against these conflicts. One group works on government engagements, the other group does not.

In its representation of the city in its RFP process, the attorneys working on the city team did not work on the Bally’s Quad Cities matter. Lawyers that worked on the Bally’s Quad Cities transaction did not work on the city of Chicago transaction and were a part of the group that does not work on government engagements.

Taft is a firm of almost 700 lawyers with nationwide gaming practice having represented clients such as the states of New York, Michigan, Louisiana, and Maryland as well as cities such as Detroit, Rockford, and Springfield, Mass. Taft also represents several casino operators, sports wagering operators, and lenders and investors in gaming opportunities, including representing other proposed bidders or their affiliates on the Chicago casino.

https://www.chicagobusiness.com/greg-hinz-politics/chicago-casino-firm-advised-lightfoot-also-represented-winning-bidder

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