Wednesday, December 14, 2011

Once Again Michael Malik is at Center of Intra-Tribal Controversy; War Brews on Shinnecock Reservation over Gateway Casino Resorts Contract

Discord Erupts Over Shinnecock Vote On Casino Partner's Future

by Mike Wright
The Shinnecock Indian Nation is set to hold a pivotal vote today, December 15, on whether the tribe will continue its business relationship with Gateway Casino Resorts, the Detroit-based casino developers that have pumped millions of dollars in legal fees and salaries into the tribe over the last eight years in an effort to build a Shinnecock gaming facility.

But in the run-up to the vote, which could approve or reject a new contract with Gateway that was drafted by the tribe’s Gaming Authority, discord has arisen among tribal members over the involvement of Gateway principal Michael J. Malik and the future path of the casino effort in general. The Tribal Council has called for the vote to be canceled while it seeks an independent legal review of the new Gateway contract.

In what was supposed to be a confidential letter to tribal members this week, the Tribal Trustees called for the vote and urged the tribe to ratify the new contract. The letter is dated December 12, just four days before the vote was to be held—a period of time members of the Tribal Council apparently felt was not long enough for tribal members to familiarize themselves with the details of the 12-page contract.

“The Tribal Council is attempting to do its fiduciary responsibility of reviewing the documents with a third-party, unbiased legal council to advise the Nation and tribal leadership before this vote is to be taken,” a statement issued by the Tribal Council on Wednesday morning said. “We are disappointed with the Board of Trustees for forcing this time line and vote on the community before this evaluation is complete. The Tribal Council does not support the vote at this time.”

The tribe’s five-member Gaming Authority has outlined plans for up to three Shinnecock-run casinos on Long Island. This past summer, the tribe received the tacit support of Nassau County Executive Ed Mangano to be the primary developer of a new gaming facility at Belmont Race Track and unveiled sketches of a hotel, casino and entertainment complex adjacent to the famed horse racing venue. Over the last two years, the tribe has also been in discussions with Suffolk County leaders about possible sites for a casino, including parcels in Brookhaven and Riverhead towns.

The new contract with Gateway includes provisions that would have Mr. Malik and his partner, Marian Ilitch, wife of the billionaire founder of the Little Caesar’s pizza chain, continuing to finance more than two dozen salaried positions within tribal government, fund the tribe’s legal and consulting fees, and ultimately pay for the planning and construction of the hoped-for casino.

It would be the first time the Shinnecocks have renegotiated their agreement with Mr. Malik since he purchased the right to be the tribe’s partner from another casino developer, Ivy K. Ong, in 2003. Since that time, Mr. Malik has poured millions of dollars into the tribe’s legal battles, first over initial plans to use a Hampton Bays property owned by the tribe as a casino site—a proposal that has been abandoned—and then in its successful push to secure federal recognition more than a decade sooner than federal agencies would have allowed otherwise. The tribe has also waged court battles claiming contracts with Southampton’s early European settlers in which it gave up ownership of large swaths of Southampton Town were illegal—a claim widely seen as a tactic to win political support for a Shinnecock casino elsewhere.

“I believe the majority of the people will look at what Gateway has done for this community in supporting us and our efforts and livelihoods, with the jobs and the legal help and the federal recognition, and see that [Mr. Malik] has been a good business partner,” Tribal Trustee Fred Bess said this week. “The Trustees’ stance is that we have a good working relationship with our current developer, and we’re looking for their support to move to the next level. We feel that we’ve had many discussions with the membership on these issues, and we think the time is now.”

The letter from the Trustees says that they will not proceed in signing the contracts without the support of the full tribe and cannot enter into any binding agreements on possible sites for a Shinnecock casino, or the necessary compact with New York State, until the contracts with Gateway are affirmed.

The full text of the contract has been posted on a website called The Verifiable Truth, which does not identify its publisher. The website features stories and documents related to the gaming industry, and to Mr. Malik and Mrs. Ilitch specifically. Mr. Bess, however, confirmed the authenticity of the documents posted at the website.

“It’s unfortunate that some tribal members took it upon themselves to talk outside the tribe and share these documents and information with others,” Mr. Bess said. “But we’re going to deal with it and, hopefully, do what’s right for the tribe. The Trustees have the best interests of this community at heart. This is just growing pains, and we’ll get through it as a community.”

Various Related Documents

Michael J. Malik, Sr. is a controversial character, who is often at the center of intra-tribal disputes with those whom he is a casino development partner.  Earlier this year the tribal chairwoman for the Los Coyotes Band of Indians (CA) was ousted because Malik didn’t like a business partnerships she had arranged.  The long-time chairman of the Bay Mills Indian Community (MI) was ousted in an election last month in part because tribal members saw him as Malik’s tool and they’d had enough of Malik’s idle promises for off-reservation casinos.  The now deceased elder and former chairperson of one tribal partner became disillusioned with Malik and called him the “Devil.” She said he had “seduced” younger members of her tribe who didn’t know any better.  By that, she meant he had bought them off with salary, or stipends, or honorariums.

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Ilitch has backed loosing sports teams and pizza, but casinos in Detroit? 10.09.06 ● Marian Ilitch #1 on "25 Most Powerful People" to Watch 2006” global gaming business o1.oo.o5 ● My Kingdom for a Casino Forbes 05.08.06 ● Big Lagoon’s casino dream awakens north coast journal 07.28.05 ● Shinnecocks launch legal claim to Hamptons land 06.16.05 ● Ilitch Plans to Expand Casino Empire 07.05.05 ● Ilitch outbids partners 04.14.05 ● Ilitch enmeshed in NY casino dispute 03.20.05 ● Marian Ilitch, high roller 03.20.05 ● MGM Mirage to Decide on Offer for Casino in Detroit 04.16.05 ● Secret deal for MotorCity alleged 02.15.05 ● Los Coyotes get new developer 02.08.05 Detroit casino figure to finance Barstow project 07.07.03 ● Indian Band trying to put casino in Barstow 06.04.03 Pizza matriarch takes on casino roles 10.23.02 ● Vanderbilt gets short straw in negotiations for a casino Lansing Journal 10.06.02 ● Indians aim to drive family from tribe in vicious dispute san diego union tribune 04.09.00 ●Malik owns 2000 Michigan Quarter Horse of the Year 01.01.00 ● Detroit Team to run Michigan’s newest Indian casino 05.23.99 Tiger ties tangle Marian Ilitch 04.29.99 ● Three investors must sell their Detroit casino interests 04.25.99 ● Partners’ cash revived election; They say money was crucial to Prop-E 04.25.99 Investors have troubled histories las vegas review journal 04.27.99 ● Investor served probation for domestic assault on 12 year old boy 04.25.99 Can a pair win a jackpot?: local men hope to... 03.17.97

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