Ilitch partner delinquent on Harsens Island property taxes

A search of records available at the St. Clair County Equalization Department indicates casino syndicator Michael J. Malik, Sr. is delinquent on 2008 property taxes due and payable for nine parcels of land on Harsens Island owned by his affiliate Lucky 7 Development LLC.

The nine parcels have a 2009 equalized value of $1,224,500. Malik's delinquent 2008 tax bills total $9,417.57.

Malik had attempted to win approval to develop a marina on the Harsens Island property in the 1990s. More recently he has resurrected those plans and expanded them to include clustered residential units and estate lots. His latest plans however, have also failed to win approvals from local and state agencies.

Malik is partners with the Detroit's Ilitch family on various casino and real estate ventures. For more than a decade, he has pushed plans to develop a Bay Mills Indian casino in Port Huron, MI. Those plans are also supported by members of the Ilitch family. Mrs. Marian Ilitch owns Detroit's MotorCity Casino.

Lucky 7 Development LLC was originally formed by Denise Ilitch and her former husband Jim Lites.

Ilitch partner enters settlement agreement in fraudulent transfers case

Michael J. Malik, Sr., has entered into a Settlement Agreement filed in Florida Federal Court in which a court appointed Receiver (Michael I. Goldberg) contends Malik received $620,000 in fraudulent transfers. Under terms of the Agreement, Malik has twelve months to repay the Receivership or face further penalty.

The case against Malik (Goldberg v. Malik) stems from a $300 million ponzi scheme case the SEC brought against one-time concert promoter John P. Utisck (Jack Utsick) and his affiliates including Worldwide Entertainment.

Court records indicate Bruce Glatman, believed to be a California resident, was the matchmaker who brought Malik together with then Florida-based Utsick. Utsick has since taken asylum in Brazil. It's not clear how Glatman came to know Malik or the scope of other dealings between Glatman and Malik.

Malik's primary business attorney William Serwer was also involved in the transactions that resulted in the fraudulent transfers.

Malik has been the gambling and casino development partner of Detroit's Marian Ilitch for more than a decade. They bankrolled efforts during the 1990s to legalize gambling in Detroit. She is now sole owner of Detroit's MotorCity Casino.

Mrs. Ilitch and her husband Mike Ilitch are co-founders of Little Caesar's Pizza and owners of the Detroit Red Wings hockey franchise. Mike Ilitch owns the Detroit Tigers baseball team.

AZ Game and Fish Commission denies appeal by Michael J. Malik

As TVT previously posted, Detroit-based Michael J. Malik, Sr., requested the Arizona Game and Fish Commission reconsider its December 2008 decision to suspend Malik's right to hunt, trap and fish in Arizona and more than 30 other states including Michigan for a period of five years and assess Malik with a $14,995 fine.

The Commission entertained and denied Malik's request at its 4.17.09 meeting. He apparently has a 30-day window to make an appeal to the Arizona Superior Court.

On 8.29.08, Arizona's Pinetop Justice Court found Malik guilty of discharging a firearm while stalking elk within the quarter-mile limit of occupied residences. (See: Michigan man found guilty on charge stemming from elk hunt).

That criminal conviction authorized the Commission to take civil action against Malik at its 12.05.08 meeting. (See: Michigan man assessed $14,995 for killing trophy elk near homes).

Malik reportedly has yet to pay the $14,995 civil fine assessed by the Commission in December 2008.

Malik is the gambling and casino development partner of Detroit's Marian Ilitch. She is sole owner of MotorCity Casino. Mrs. Ilitch and her husband Mike Ilitch are founders of Little Caesar's Pizza and owners of the Detroit Red Wings hockey franchise. Mike Ilitch owns the Detroit Tigers baseball team.


Malik's Growing Record of Illegal Activity

In 1999, the Michigan Gaming Control Board (MGCB) failed to grant Malik a gambling license and he was forced to divest himself of interest in Detroit's MotorCity Casino. Among other things, it was reported that Malik had been arrested in 1997 and accused of beating a girlfriend's 12-year-old son. He served a year of probation in the matter.

Since the MGCB denied Malik a license, he has developed a growing record of illegal activity:

• The criminal and civil actions in Arizona noted above related to Malik's illegal discharge of a firearm. He's been assessed multiple fines and stripped for the next five years of his right to hunt in 32 states.


• Malik has twice (2006 & 2009) been found guilty of, and fined for, violating California's political reform laws. Over the course of several election cycles, he's simply failed to report more than $52,000 in political contributions.


• Fifth Third Bank, a Michigan Banking Corporation filed a complaint in Oakland County Court on 4.03.09 (Fifth Third Bank v. Michael M. Malik, Sr.) alleging Malik was in Default on a $1 million line of credit that had come due on 9.01.08.


• In April, Malik entered into a Settlement Agreement (Goldberg v. Malik) with a court appointed Receiver who contends Malik received more than $620,00 in fraudulent transfers. Malik has twelve months to repay the funds as agreed. That action is related to a $300 million ponzi scheme case brought by the SEC against Worldwide Entertainment and promoter Jack Utsick who has since taken asylum in Brazil.

Is this known record of illegal activity a red flag that there's more?

Revenues at MotorCity Casino fell 5.3% in April

According to a story, "Greektown Casino reports slight gain in April revenue," published in Crain's Detroit Business:

MotorCity Casino Hotel had April revenue of $38.5 million, posting a 7.4 percent decrease compared to March and a 5.3 percent drop compared to April 2008.

In December 2008 revenues at MotorCity Casino fell 11.25% and CMM Merger Inc., parent of MotorCity Casino, failed to meet lending convenants so angry investors demanded owner Marian Ilitch inject $45 million cash into the Detroit gaming enterprise that struggles even after expanding its gaming floor space and adding a luxury hotel to the property. Ilitch acquired 100% control of MotorCity Casino from MGM Mirage and various other investors in 2005.

According to reports published by the Michigan Gaming Control Board (MGCB) over all year-to-date revenues at a highly leveraged MotorCity Casino are down 1.7% compared to the same period in 2008.

MGCB: Detroit Casino Revenue Reports

Ilitch Malik Gaming Affiliates paid D.C. lobbyists nearly $5 million pushing Indian casinos

(Click table below for larger view)

Updated analysis of federal lobbying expenses from 2002 through 2008 indicate gaming affiliates/partners of Mrs. Marian Ilitch and Michael J. Malik, Sr. paid Washington, D.C., lobbying firms $4,835,000 to advance various plans for Indian casino developments in New York (Shinnecock Indian Nation), Michigan (Bay Mills Indian Community) and California (Los Coyotes Band of Cahuilla and Cupeno Indians & Big Lagoon Rancheria). The data was obtained from records onfile with the U.S. Senate Office of Public Records and Opensecrets.org.

Detroit casino to benefit from Obama stimulus package

According to blogger Brian Darling at HumanEvents.com; the Obama stimulus package includes:

"$1.5 million to improve the parking garages and roads surrounding the Greektown Casino development in Detroit."

Detroit's Greektown Casino filed for Chapter 11 bankruptcy protection back in May. Greektown Casino, one of three commercially operated casinos in Detroit, is owned primarily by the Sault Ste. Marie Tribe of Chippewa Indians.

Tom Celani, a former founding partner in Detroit's MotorCity Casino along with Marian Ilitch and Michael J. Malik, Sr., tried to buy controlling interest in Greektown Casino back in January, according to a story published in the Detroit News, but that transaction was never consumated.

But now, according to BackRoomNews.com:

"Tom Celani, a Bloomfield Hills businessman and investor, is trying to buy Greektown Casino in downtown Detroit.

Celani, who was an initial investor in Motor City Casino, has partnered with a Connecticut-based hedge fund called Plainfield to bid for Greektown, which is being marketed to buyers through bankruptcy proceedings.

Celani says he expects he is among up to four bidders interested in the casino, which generates $300 million a year in annual revenue. Celani would not disclose the amount of his bid.

'I understand the property very well … I’ve been in the casino business for 20 years. Gaming is what we enjoy,' Celani said. 'I’d love to do it in my hometown.' "

Ilitch VP takes over as agent of affiliates pursuing New York casino

Documents filed with the Michigan Department of Labor & Economic Growth indicate John Kotlar, Vice President of Tax Affairs at Detroit-based Ilitch Holdings, Inc. has replaced attorney William D. Serwer as Resident Agent of:

• Gateway Casino Resorts, L.L.C.
• Gateway Holdings, L.L.C.

Originally organized in September 2003 as Empire Ventures, L.L.C.; one month later Serwer changed the entity’s name to Empire Associates, L.L.C.; and then in January 2004 he changed the entity’s name to Gateway Casino Resorts, L.L.C.

Serwer remains as Resident Agent of Gateway Manager, Inc., an assumed affiliate, which has yet to file a 2009 Annual Report.

Serwer, primary business attorney for gambling promoter Michael J. Malik, Sr., and his numerous affiliates, has been Resident Agent for dozens of Malik affiliates dating back to the early 1990s.

Malik and Mrs. Marian Ilitch are reportedly the principals behind the Gateway affiliates which were organized to pursue casino development opportunities with the Shinnecock Indian Nation on Long Island, NY. Gateway had pursued opportunities to manage future gambling operations at New York's Aqueduct Racetrack.

Mirroring the Gateway changes, Kotlar also recently replaced Serwer as Resident Agent of several other Malik/Ilitch gambling affiliates (Barwest, LCB Barwest, etc.) originally organized to pursue casino development and management opportunities in Barstow, CA.

Ilitch is the owner of Detroit’s MotorCity Casino. She’s vice chairwoman of Ilitch Holdings, Inc. which is the parent company of Little Caesars pizza (co-founded with husband Mike Ilitch), Detroit Red Wings, Detroit Tigers, Olympia Entertainment and scores of other Ilitch Family controlled affiliates.

See Comprehensive List: Malik/Ilitch Family Affiliates

Forbes reports drop in Ilitch net worth; value of Detroit Tigers

In it’s March 2009 ranking of “The World’s Billionaires,” Forbes is calculating the net worth of Detroit’s Mike Ilitch at $1.4 billion. In September 2008, as part of its annual ranking of the “400 Richest Americans,” Forbes had estimated Ilitch’s net worth at $1.6 billion.

As part of its Billionaires List coverage, Forbes writer Claire Obusan reports:

"Pizza patriarch and sports team owner Michael Ilitch fell off the Forbes 400 in 2005 after other tycoons outpaced his $815 net worth. Ilitch bounced back a year later after revamping his Little Caesars pizza chain and watching the value of his two pro sports teams, the Detroit Redwings [sic] and Detroit Tigers, soar. In 2006 his net worth rose to $1.5 billion, and his sports and pizza empire have since successfully weathered the current recession. Ilitch's net worth was estimated at $1.4 billion this March, down 13% from 2008."

As we previously reported, in its annual valuation of Baseball teams published this week, Forbes estimates the value of Ilitch’s Detroit Tigers dropped 9% in the last year and Forbes analysts anticipate further financial woes for the team during the 2009 season.

The gambling hall owned by Ilitch's wife, Marian Ilitch, is facing financial woes as well. Investors demanded earlier this year that Ilitch inject MotorCity Casino with $45 million cash; and Moody's has now placed the casino property's parent company, CCM Merger, Inc., on its "Bottom Rung" list anticipating the company will go into default.

Here are links to see how Ilitch and his various affiliates currently rank on Forbes’ various annual lists:

• 400 Richest Americans (9.17.08)
• America’s Largest Private Companies (11.03.08)
• The Business of Baseball (4.22.09)
• The Business of Hockey (10.29.08)
• The World’s Billionaires (3.11.09)

Forbes reports Detroit Tigers lost $26M; saw 9% drop in value

4.22.09

The Business Of Baseball
#21 Detroit Tigers

The skinny
Just two seasons after reaching the World Series the Detroit Tigers won only 74 games in 2008. The Tigers managed to accomplish this despite having a $136 million payroll, fourth highest in baseball. But Tiger fans stayed faithful, with a team-record 3.2 million of them pouring through the turnstiles. Billionaire owner and pizza chain king Michael Ilitch is taking a big risk this season, albeit probably a necessary one: With the Detroit economy crumbling he is raising ticket prices for "premium games" by $2 to $7 and many season ticket holders are getting a similar price hike. With the auto companies imploding and discretionary income plummeting for many fans, Ilitch's strategy looks like it has backfired. Season ticket holders have fallen [44%] from 27,000 in 2008 to a reported 15,000 this year. If attendance does not pick up during the summer, Ilitch will no doubt regret this gamble.

Forbes: #21 Detroit Tigers

Forbes: 2009 MLB Valuations

Crain's Detroit Business: Forbes.com reports 9% decline in value of Detroit Tigers franchise

Ilitch VP replaces Malik attorney as resident agent of gambling affiliates

According to documents filed with the Michigan Department of Labor & Economic Growth, John Kotlar, Vice President of Tax Affairs at Ilitch Holdings, Inc. has replaced attorney William D. Serwer as Resident Agent of:

• Barwest L.L.C.
• Barwest Holdings, L.L.C.
• LCB Barwest, L.L.C.
• LCB Barwest Holdings, L.L.C.

Serwer, primary business attorney for gambling promoter Michael J. Malik, Sr., and his numerous affiliates had been Resident Agent of these entities since they were formed. Serwer has been Resident Agent for most Malik controlled affiliates dating back to the early 1990s.

Serwer remains as resident agent for the following affiliates which have yet to file 2009 Annual Reports:

• Barwest Manager, Inc.
• LCB Barwest Manager, Inc.

It has been reported that Malik and Mrs. Marian Ilitch are the principals behind the Barwest entities which were formed beginning in 2003 to advance casino development projects in Barstow, CA.

Ilitch is the owner of Detroit’s MotorCity Casino and vice chairwoman of Ilitch Holdings, the parent company of Little Caesars pizza, Detroit Tiger, Detroit Red Wings, Olympia Entertainment and various other sports, restaurant, entertainment and real estate ventures. Kotlar is resident agent for most entities under the Ilitch Holdings umbrella.

A legally binding Stipulation on file in California and signed by Malik indicates that:

“Barwest, LLC, is a casino development company based in Detroit, Michigan. At the time of the prior enforcement action [Aug. 2006], Respondent Malik was a non-majority partner in Barwest, LLC, with some - but not full – decision making authority.”

See comprehensive list: Companies controlled by the Ilitch Family and/or Malik.

Detroit-based Michael Malik wants AZ Commission to reconsider five-year hunting license revocation and $14,995 fine

An official Notice & Agenda for a 4.17.09 meeting of the Arizona Game and Fish Commission indicates a tenacious Detroit-based Michael J. Malik, Sr., seeks a rehearing on a decision the Commission made in December 2008.

At that meeting, the Commission fined Malik $14,995 for shooting a trophy elk too close to residences without the permission of the homeowners; and revoked his right to hunt, fish and trap in Arizona and 32 other states for the next five years. Item 11 on the Notice & Agenda for the 4.17.09 meeting read:

Item 11
Presenter: Gene Elms, Law Enforcement Branch Chief. Rehearing Request Regarding Previous License Revocation/Civil Assessment. Mr. Michael Malik has requested that the Arizona Game and Fish Commission grant a rehearing regarding the action taken on revoking his licenses to hunt, fish, and trap for a period of five (5) years, invoking a civil assessment of $8,000.00, and further requiring that he complete a Hunter Education course before obtaining any license in the State of Arizona. The Commission may vote to affirm or modify its decision, or grant a rehearing.

Malik was found guilty in Arizona's Pinetop Justice Court on 8.29.08 of discharging a firearm within the quarter-mile limit of occupied residences while taking elk. (See: Michigan man found guilty on charge stemming from elk hunt).

The criminal conviction authorized the Commission to take civil action against Malik which it did at its 12.05.08 meeting. (See: Michigan man assessed $14,995 for killing trophy elk near homes).

CA FPPC finds Detroit casino syndicator Michael Malik violated campaign reform laws

As published in the Public Notice & Agenda for a 2.19.09 meeting of California's Fair Political Practices Commission (FPPC):

In the Matter of Michael J. Malik Sr., Michael J. Malik, Sr. Trust, and MJM Manistee, Inc., FPPC No. 07/195. Staff: Commission Counsel Angela Brereton. Respondents Michael J. Malik, Sr., Michael J. Malik Sr., Trust, and MJM Manistee, Inc. (collectively, “Respondent Committee”) jointly qualified as a single “major donor committee” under the Act for calendar year 2006. Respondent Committee filed a required semi-annual campaign statement but failed to disclose on the statement 17 contributions made during the reporting period totaling $26,500, in violation of Government Code sections 84200, subdivision (b), and 84211, subdivision (k)(5) (1 count). Total Proposed Penalty: $4,000. Order / Exhibit

This isn't the first time Malik has broken the law. Considers these incidents:

Malik is currently facing federal fraud charges in Florida (Goldberg v. Malik) relating to a Securities & Exchange Commission ponzi scheme case against one-time entertainment promotor Jack Utsick.

Last year, Malik was found guilty on illegal firearms related charges in Arizona.

In its 2.19.09 findings, the FPPC acknowledges that a casino affiliate of Mrs. Marian Ilitch and Malik, BarWest LLC, was found in 2006 to have violated the same CA campaign reform laws and Malik agreed to pay fines and file the appropriate disclosures in that matter.

Malik was once arrested for beating up the 12-year-old son of a girlfriend.

Ilitch partner violated campaign laws by failing to report casino related campaign contributions

In its first public action resulting from a nearly two year investigation into the campaign finance and lobbying practices of Detroit Casino developer Michael J. Malik, Sr., California’s Fair Political Practices Commission (FPPC) has found Malik violated state political campaign laws by falsely filing a campaign finance report in January 2007 that failed to disclose political contributions Malik made to 17 campaign committees and totaling $26,500 between the period July 1 – December 31, 2006.

Malik is the principal casino and development partner of Mrs. Marian Ilitch. She is the owner of Detroit’s MotorCity Casino. Ilitch and her husband Mike Ilitch are co-founders of Little Caesars Pizza and co-owners of the Detroit Red Wings. Her husband owns the Detroit Tigers. The parent company of their various affiliates is Detroit-based Ilitch Holdings, Inc. Marian Ilitch and Malik have formed various affiliates to pursue gambling opportunities across the U.S. including BarWest LLC, an entity pursuing casino resort development projects in Barstow, CA.

In its 2.19.09 decison, the FPPC notes this isn't the first time Malik has been involved in similar violations. In 2004, BarWest LLC failed to report a $26,600 contribution to a San Joaquin County GOP committee. In the Fall 2006, Malik acknowledged those violations, and paid a fine to the FPPC.

Malik is currently facing federal fraud charges in Florida (Goldberg v. Malik) related to a Securities and Exchange Commission ponzi scheme case against concert promoter Jack Utsick.

Public Notice & Agenda: FPPC Meeting 2.19.09

Press Release: FPPC Enforcement Decisions 2.19.09

Ilitch uses taxpayer subsidies to level more Foxtown buildings

3.19.09

Spaces for Final Four
Buildings razed to open room for new parking lots

Louis Aguilar / The Detroit News

DETROIT -- To create more parking for the throngs anticipated for next month's NCCA Final Four basketball championship, Ilitch Holdings Inc. is using state Super Bowl XL funds to quickly demolish five empty downtown buildings.

In less than two weeks, four buildings have been razed, including the former Chin Tiki, a Polynesian-themed restaurant featured in the Eminem film "8 Mile." The other demolished structures are a former apartment complex on West Grand River; an office building on West Columbia; and the former Egyptian building on Cass.

The last one to go is a parking garage at 145 W. Elizabeth, bought by an Ilitch executive in 2007 through a private company, which listed the Ilitches' Fox Theatre headquarters as its address. That was the period in which the Ilitch family quietly increased control of a rundown patch of downtown long considered a potential site for a new hockey arena for the Ilitch-owned Detroit Red Wings.

Mike Ilitch, co-founder of the Little Caesars Pizza chain that started the family's billion-dollar sports, real estate and business empire, has hinted he prefers building a new hockey arena near the Fox.

No decision has been made about that.

The flurry of demolition is all about "added safety and security," said Ilitch spokeswoman Karen Cullen.

"The structures in question were not suitable for long-term redevelopment," Cullen said. "The ability to move forward and remove non-viable buildings from the area ... greatly enhances the appearance for surrounding property owners and their venues."

In December, the city's Downtown Development Authority approved $2.5 million for the demolitions. The money came from state funding originally intended to level empty buildings in time for Super Bowl XL, three years ago.

The properties will become paved parking lots to accommodate the more than 100,000 people who will converge downtown during the first week of April for the NCAA Final Four.

"Yes, that's still the goal," said Fred Beal, president of J.C. Beal Construction Inc, who lobbied on behalf of the Ilitches to obtain the state money.

You can reach Louis Aguilar at (313) 222-2760 or laguilar@detnews.com

TVT Note: A comprehensive map of properties believed to be owned or controlled by the Ilitch family in Foxtown is available here.

Moody's anticipates default for Ilitch affiliate; adds it to "Bottom Rung"

Moody's Investor Services has launched a quarterly report that currently lists nearly 300 companies in the U.S. most likely to fall into default. The list, known as the "Bottom Rung," includes Ilitch-owned CCM Merger, Inc.

Moody's analysts anticipate that 45% of the companies on the list will go into default within the next year.

The "Bottom Rung" represents about 15% of the companies the respected credit ratings agency tracks.

CCM Merger, Inc. has been described as a subsidiary of Ilitch Holdings, Inc. It is the parent company of Detroit's MotorCity Casino which is owned solely by Mrs. Marian Ilitch.

Ilitch bought controlling interest in MotorCity Casino from MGM Mirage in 2005. It's reported that she owes investors more than $1 billion.

In February investors demanded that Ilitch inject $45 million cash into the struggling gaming and entertainment enterprise.

Other affiliates of Ilitch Holdings include the Detroit Tigers, Detroit Red Wings, Little Caesar Enterprises and Olympia Entertainment.