In 1996, a group of businessmen formed a coalition and began negotiations with the Tribe to develop the Casino Project on a 29-acre plot adjacent to the Monticello Raceway. The coalition formed three different business entities involving various partners and investors, each with its own partners with expertise in obtaining approvals or developing the Casino Project. Each entity was responsible to accomplish a distinct aspect of the project and each negotiated a separate contract with the Tribe to cover its role. The three entities were:

• Catskill Development LLC, which, after acquiring title to Monticello Raceway in l995, negotiated a Land Purchase Agreement to sell the land to the Tribe for the Casino Project.  Subject to federal and state approvals, the land was to be held by the United States in trust for the Tribe in accordance with the Indian Gaming Regulatory Act of 1988 (“IGRA”) and regulations of the U.S. Department of Interior, Bureau of Indian Affairs (“BIA”).
• Mohawk Management LLC, which negotiated a Management Agreement with the Tribe for the Casino Project. The Management Agreement required the parties to seek all necessary approvals and was to become effective upon approval by the National Indian Gaming Commission (“NIGC”).
• Monticello Raceway Development LLC, which negotiated a Construction and Development Agreement with the Tribe for building the gaming facility.

Tribe submits application for approval.

Pursuant to the various agreements, on August 2, 1996, the Tribe applied to the BIA for approval to have 29 acres of land adjacent to Monticello Raceway acquired by the United States in trust status for the Tribe and to approve the use of the land for the Casino Project. In accordance with BIA procedures, materials were also submitted to the NIGC for review, including copies of the relevant contracts. This submission would allow the NIGC to be in a position to approve the Management Agreement at the time that the land was placed in trust for the Tribe.

The BIA spent four years reviewing and processing the application. On April 6, 2000, the Secretary of Interior issued a key approval (“two-part determination”) necessary to place the land into trust for gaming purposes, and requested that the Governor of New York State concur in the two-part determination of the Secretary, as required by federal law.

One week later, on April 14, 2000, before the Governor could formally concur, Park Place, induced the Tribe to enter into an agreement providing for the Tribe to commit all future casino efforts in the State of New York exclusively to Park Place. This agreement interfered with the previous agreements signed by the Tribe for the Casino Project. It also interfered with the then existing business relationship the Monticello Raceway entities had with the Tribe. At the time, Park Place was the largest casino operator in Atlantic City and would have been the largest single competitor of the Casino Project and primary beneficiary of its derailment.