A major investor in the proposed Hard Rock Casino Rockford in the Illinois city of Rockford is being sued after he sought to expand his chain of gambling cafes.
Dan Fischer, who owns the Dotty’s chain of gambling cafes, is a chief investor in a proposed casino complex in Rockford.
Mr. Fischer is being accused of taking part in a “sham transaction” to grow his chain of slot parlors in a $46.5 million deal. A civil lawsuit against the businessman was filed in a Cook County court not long ago.
Mr. Fischer’s company Illinois Cafe and Service Company LLC, which owns Dotty’s, is being countersued by Gold Rush Amusements Inc., owned by Hoffman Estates.
According to court papers, after the acquisition of 63 Stella’s and Shelby’s gaming cafes in the Chicago area, Mr. Fischer’s company sought to replace the gaming machines supplied by Gold Rush at 44 of the facilities with terminals supplied by Midwest SRO.
The Dotty’s owner has long maintained a business relationship with Midwest and the latter company has supplied gambling machines to the chain of gambling outlets.
Mr. Fischer’s company filed a lawsuit against Gold Rush’s owner, Rick Heidner, after the gaming machine provider tried to prevent his company’s terminals from being replaced at the above-mentioned 44 locations.
Gold Rush filed a countersuit, saying that Illinois Cafe and Service Company conspired with Midwest to cheat the provider out of business. According to court documents, Gold Rush accuses Mr. Fischer’s gambling empire of buying the Chicago-area gambling establishments in a deal that was primarily financed by Midwest.
Violation of Illinois Law
In its lawsuit, Gold Rush said that the deal for the acquisition of the gaming cafes violated Illinois law which prohibits gaming machine providers from offering inducements to gaming establishments.
Illinois Cafe and Service Company maintains that the deal was legitimate and that it informed the Illinois Gaming Board about its plans to purchase the Stella’s and Shelby’s locations, but the public relations companies that publicized Gold Rush’s claims, said that the state gambling regulator never signed off on the complex acquisition deal.
However, Illinois Cafe and Service Company President, Charity Johns, argued that the owner of Gold Rush himself had landed in regulatory trouble. According to Ms. Johns, the Illinois Gaming Board is looking to revoke Mr. Heidner’s license for offering to arrange a deal in which Mr. Fischer would have been paid $5 million more than what he had paid to purchase the Chicago area locations.
It is unclear how and whether the accusations leveled against Mr. Fischer and his company would impact the review of the Hard Rock Casino Rockford plan. Florida-based gaming and hospitality Hard Rock International submitted its proposal with the Illinois Gaming Board last fall after it secured endorsement by the Rockford City Council.
It is understood that the state gambling regulator has recently begun vetting the casino application.
Bobbie Holzwarth, the Rockford attorney who helped the city through the process for the selection of a preferred casino operator, commented that the litigation is “very contentious” and that the court would hopefully “sort it all out.”
Hard Rock plans to build a $311 million complex at the site of the former Clock Tower Resort on Rockford’s East State Street near the I-90 entrance.
The property will feature a 65,000-square-foot gaming floor with slot machines and table games, a 1,600-seat Hard Rock Live event venue, and food and beverage facilities.
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