Seminoles Sued over Hard Rock Casinos Buyout, a Poker Bad Beat?

Cordish Co., a Baltimore-based company who previously developed Hard Rock cafes with the Seminole Tribe, has sued Rank Group's Hard Rock Cafe International Inc. and the Seminole Tribe of Florida claiming the two companies colluded to leave it out of the recent bidding for the Hard Rock properties, which was awarded to the Seminole Tribe.

Cordish has also sued Merrill Lynch for at least $75 million, alleging the Wall Street investment bank acted wrongly as a result of pressure from the Seminole Tribe, denying Cordish access to paperwork to complete their due diligence to reach a competitive bid price.

The suit also suggests Merrill Lynch's relationship with the tribe may have given the Seminoles a leg up over other bidders for Hard Rock International, which they are buying for $965 million, noting reports that securities analysts were disappointed with the Rank Group purchase price.

The Cordish Co. and its affiliate, Power Plant Entertainment, filed a lawsuit in circuit court in Broward County, Florida, challenging the planned $965 million purchase of the International Hard Rock brand by the Seminole Tribe through its subsidiary, Seminole Hard Rock Entertainment Inc., announced on Dec. 7.

Officials with Cordish said they filed the lawsuit Dec. 30. The lawsuit says both Hard Rock and the Seminole Tribe "participated in collusion and bid rigging with respect to offers to purchase Hard Rock from" the Rank Group, the London-based company which owns the Hard Rock assets.

Cordish officials said they were precluded from bidding for Hard Rock by the company "artificially fixing a value and price ... by eliminating, reducing or interfering with competition," a release said.

In a response Tuesday, Seminole Hard Rock Entertainment said the lawsuit is part of a pattern of Cordish obstructing its successful enterprises and those of the Seminole Tribe of Florida.

"It arises out of the Tribe's ongoing litigation with the Cordish and Power Plant Entertainment companies. The lawsuit has no merit," said the tribe's spokesman Gary Bitner in an e-mail.

"The Tribe was awarded the right to buy Hard Rock International after a lengthy and open bidding process which included Permira, TDR Capital and Apollo Management. In a simple statement, this is just David Cordish being a sore loser," the prepared statement said.

The Seminole tribe had sued Cordish in May, seeking to break their partnership on prior Hard Rock properties.

But Cordish said it was never allowed to receive bid documents from Merrill Lynch, which was representing Rank in the process, according to the lawsuit.

It claimed that Cordish executives were never allowed to access specific documents necessary to complete their due diligence of the Hard Rock chain, and if they had, company officials said they would've outbid the Seminole Tribe for the assets, the release said.

Cordish tried to obtain bid materials twice between Sept. 1 and Sept. 7, according to the press release, but were told both times by Merrill Lynch not to provide documents to the company and that Rank would not consider a bid from Cordish.

The lawsuit charges that Rank and the Seminole Tribe violated Florida's Deceptive and Unfair Trade Practices Act, and is seeking unspecified financial damages, Cordish said in its release.

Shareholders for the publicly held Rank Group are expected to vote on the Hard Rock sale to the Seminole Tribe Jan. 8.

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