Attorney: Casino contract ridiculous
A legal disagreement between the executors and the beneficiaries of the Eisenhower Hotel and Conference Center estate could compromise the plans of a Gettysburg businessman and a former state representative who want to convert the property into a resort casino.
The attorney for 10 past and present hotel employees – known collectively as the Sanders Group after being named beneficiaries by the estate’s late owner, Richard L. Michael – has filed a petition in the Franklin County Court of Common Pleas asking that a judge void an option-to-purchase contract reached last year between the executors and the development company that wants to operate a casino at the Cumberland Township property.
The beneficiaries contend that the estate’s executors failed to anticipate the intentions of KJM Development Company – headed by former state Rep. Joseph Lashinger – to convert the hotel into a casino and therefore agreed on a “ridiculous” purchasing price, said York-based attorney Joseph C. Korsak, who represents the Sanders Group.
Korsak said the option-to-purchase contract is written under the assumption that the property would remain simply an “ordinary” hotel worth about $14 million. Korsak said he believes the beneficiaries are being sold short by the executors’ failure to research Lashinger and uncover his many ties to the gaming industry before signing the contract.
“Since they should have known that the plan was to develop this (as a casino), the price of the hotel should have been almost exponentially higher,” he said. “We think it’s worth at least $70 million as a casino.”
In December, Korsak filed court documents arguing those points and asking the judge to “return all parties to the status quo.”
Korsak said the estate’s beneficiaries were also put off by the option-to-purchase agreement because they had been in talks with another potential buyer when the contract with Lashinger’s company was signed.
“I asked (the executors) to hold off before committing anywhere else,” Korsak said.
Korsak said this disagreement is just the latest in a long history of conflicts between the estate’s executors – Michael’s former accountant and banker, according to Korsak – and its beneficiaries. In representing the Sanders Group, Korsak said he has filed numerous complaints against the executors, whose names are not mentioned in the December filing.
“The history’s been that if these guys find somebody whose body temperature is above room temperature they’ve gotta have a contract signed immediately,” Korsak said.
Because Lashinger’s company is named in the contract, Korsak said he was as surprised as anyone when Gettysburg businessman David LeVan announced in late November that he was a party to an option-to-purchase agreement reached with the Eisenhower Hotel and Conference Center.
LeVan, who owns Battlefield Harley-Davidson on Route 30, was unsuccessful in his 2005-06 attempt to bring a casino to Adams County. Pending legislation, LeVan said in November that he and business partner Lashinger hoped to obtain a Category 3 gaming license and convert the hotel into a resort casino with slots machines and, possibly, table games. With the recent passage of state bill 711, table games are now a definite part of their plan.
Contacted Monday, LeVan spokesman David La Torre said “we have been in contact with the executors.”
“We do not view this to be a significant impediment,” La Torre said.
He declined to comment further.
LeVan and Lashinger are in the process of filing an application with the Pennsylvania Gaming Control Board to obtain a gaming license that would allow them to operate 600 slots machines and 50 table games at the property. They face competition from at least three parties that have also expressed interest in the sole remaining license.
In the fall, LeVan said he and Lashinger would not purchase the Eisenhower Hotel unless they could first obtain a gaming license. Unless it is voided, the option-to-purchase agreement will not expire until sometime in late October or early November.
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