Exhibit 99.1
07-13-07A08:39 RCVD
Donna Cole
Tribal Court Clerk
ST. REGIS MOHAWK TRIBAL COURT
MARLENE ARQUETTE, DICK PETERS, )
BENNETTE WHITE, LOUIS GRAY, ROY ) Case No.: 00-CI-0133GN
TARBELL, DAVID LAZORE, TROY LAZORE, )
HENRY GIBSON, MATT DAVID, RANDY )
CONNORS, PATTY LAZORE MANCUSO, NOEL )
WHITE, CAROLYN TARBELL, ELLENE )
HERNE, GLENN HILL SR., BARBARA )
LAZORE, PHIL TARBELL, KERNEY COLE, ) ORDER
MARY DIANNE LAZORE, RUSSELL LAZORE, ) -----
JOANNE KING, RENA SMOKE, CHARLIE )
TERRANCE, ERMA WHITE MOORE, LOIS )
THOMAS, AND CAROL HERNE, On Behalf ) Hon. Wes Williams Jr.
of Themselves and All Others )
Similarly Situated, )
)
PLAINTIFFS-JUDGMENT CREDITORS, )
)
v. )
)
PARK PLACE ENTERTAINMENT )
CORPORATION and CLIVE CUMMIS, )
)
DEFENDANTS-JUDGMENT DEBTORS. )
)
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WHEREAS, on or about April 26, 2000, twenty-six enrolled members of the
St. Regis Mohawk Tribe, on behalf of themselves and all others similarly
situated (hereinafter collectively "Plaintiffs" or "the Plaintiff Class"),
commenced an action in this Court against, among others, Park Place
Entertainment Corporation (hereinafter "Park Place")and its former General
Counsel, Clive Cummis.
WHEREAS, the original complaint was served on Defendants in May 2000. On
May 12, 2000, Defendants' counsel of record, Dennis J. Block, Esq., submitted an
application to the St. Regis Mohawk Tribal Court Bar Association to be admitted
to practice before this Court. Defendants' attorney agreed to submit to this
Court's jurisdiction and contempt powers and swore an oath to uphold the Tribe's
laws. On June 1, 2000, Defendants' attorney entered a
personal appearance on their behalf by filing a motion to dismiss the class
action complaint, invoking this Court's jurisdiction and seeking a dismissal on
the merits, in addition to contending that this Court was "an invalid judicial
forum") without authority and power to act. Shortly thereafter, and before
Plaintiffs had time to respond to Defendants' motion to dismiss, Defendants
abandoned their defense of the action and, on June 2, 2000, filed an action in
the United States District Court for the Northern District of New York seeking
to enjoin this Court's proceedings. On September 18, 2000, the United States
District Court dismissed Defendants' action, holding that it lacked subject
matter jurisdiction to determine whether this Court was a valid tribal forum.
The United States District Court further concluded that the underlying dispute
in the Tribal Court litigation appeared to be "of the type where jurisdiction in
a Tribal Court would generally be proper." Thereafter, on September 30, 2000, an
Amended Complaint was filed in the Tribal Court action, adding Defendants Paul
Thompson, Hilda Smoke, and Alma Ransom as named Defendants against whom
declaratory relief was sought. As a result of the filing of the Amended
Complaint, this Court subsequently dismissed Defendants' motion to dismiss.
WHEREAS, Defendants thereafter wholly abandoned their defense of the class
action, failing to answer the Amended Complaint and failing to appear at the
ensuing hearing on Plaintiffs' motion for an entry of default.
WHEREAS, by order dated January 31, 2001, this Court issued an entry of
default against Defendants.
WHEREAS, by order dated March 8, 2001, this Court determined that the
"applicable law for the suit regarding the maintenance of a class action" is
CPLR article 9 and that "St. Regis Mohawk Tribal law will govern all other
issues."
WHEREAS, by order dated March 16, 2001, this Court granted Plaintiffs'
motion for class certification and defined the class as all enrolled members of
the St. Regis Mohawk Tribe.
WHEREAS, by order dated March 20, 2001, and upon Defendants' continued
neglect to defend the class action, this Court granted Plaintiffs' motion for a
default judgment against Defendants; declared the management contract entered
into between Park Place and Defendants Ransom, Smoke and Thompson to be null and
void; ordered Defendants Park Place and Clive Cummis to pay Plaintiffs $1.782
billion in actual damages; ordered Defendants Park Place and Clive Cummis to pay
Plaintiffs' costs and disbursements; and ordered Defendants Park Place and Clive
Cummis to pay punitive damages in the amount of $5 million (hereinafter the
"Default Judgment Order").
WHEREAS, due and proper notice of each step of the above proceedings was
given to the defendants in this action;
WHEREAS, Defendants Park Place and Clive Cummis failed to file a timely
appeal of the Default Judgment Order to the St. Regis Mohawk Tribal Court of
Appeals.
WHEREAS, in or about January 2004, Park Place changed its name to Caesars
Entertainment, Inc. ("Caesars").
2
WHEREAS, in or about July 2004, Caesars, Harrah's Entertainment, Inc.
("Harrah's"), and Harrah's Operating Company, Inc. ("Harrah's Operating"), a
wholly-owned subsidiary of Harrah's, entered into an Agreement and Plan of
Merger, providing for the merger of Caesars into Harrah's Operating, which would
be the surviving corporation.
WHEREAS, on June 13, 2005, the merger agreement was consummated and
Caesars merged with and into Harrah's Operating. As a consequence of the merger,
Harrah's Operating has assumed all of the rights and obligations of Park Place
and Caesars, including any debts Park Place and Caesars owe to judgment
creditors.
WHEREAS, on June 21, 2007, following a hearing, this Court approved the
joint application of the Plaintiff Class and the Catskill Litigation Trust for
assignment of the Default Judgment Order to the Catskill Litigation Trust in
exchange for a fifty percent beneficial interest in the Catskill Litigation
Trust.
WHEREAS, on June 21, 2007, pursuant to a Stipulation filed with this Court
by counsel for the Plaintiff Class and the Catskill Litigation Trust, the
caption of this proceeding was amended by redacting the names of Alma Ransom,
Hilda Smoke, and Paul Thompson, against whom no monetary relief was granted in
the Default Judgment Order.
WHEREAS, by Notice of Motion filed with this Court on June 22, 2007, the
Litigation Trustees of the Catskill Litigation Trust, as assignees of the
Default Judgment Order, moved this Court for an order (1) amending the caption
of the Default Judgment Order by substituting "Harrah's Operating Company, Inc."
for "Park Place Entertainment Corporation" as the first-named Defendant/Judgment
Debtor and (2) declaring that the applicable law regarding the calculation of
interest on the Default Judgment Order is New York Civil Practice Law and Rules
(CPLR) sections 5003 and 5004.
WHEREAS, on June 22, 2007, a copy of the Notice of Motion and supporting
Affidavit of Dennis C. Vacco were served on Dennis J. Block, Esq., as counsel of
record for Defendants Park Place Entertainment Corporation and Clive Cummis, by
certified mail, return receipt requested.
WHEREAS, on June 25, 2007, a copy of the Notice of Motion and supporting
Affidavit of Dennis C. Vacco were served on Harrah's Operating Company care of
William Buffalo, Esq., one of Harrah's Assistant Corporate Counsel via overnight
delivery service.
WHEREAS, on June 25, 2007, personal service was effected on Harrah's
Operating Company by delivery a copy of the Notice of Motion and supporting
Affidavit of Dennis C. Vacco to Harrah's Operating Company's registered agent
for service of process at 80 State Street, Albany, New York.
WHEREAS, on June 26, 2007, personal service was effected on Harrah's
Operating Company by delivering a copy of Notice of Motion to the process agent
of the corporation, Mary Drummond, at 2711 Centerville Rd., Wilmington,
Delaware.
3
WHEREAS, by order dated June 29, 2007, this Court scheduled a hearing for
July 9, 2007 at 9:00 AM on the Catskill Litigation Trust's motion to (1) amend
the caption of the Default Judgment Order by substituting "Harrah's Operating
Company, Inc." for "Park Place Entertainment Corporation" as the first-named
Defendant/Judgment Debtor and (2) determine the law applicable to the
calculation of interest on the Default Judgment Order. The scheduling order
directed that any pleadings addressing the motion be filed with the Court on or
before 5:00 PM on July 8, 2007.
WHEREAS, on July 2, 2007, a copy of the scheduling order was served via
overnight delivery service on Harrah's Operating Company, care of William
Buffalo, Esq., as well as on Dennis J. Block, Esq., counsel of record for the
named Defendants.
WHEREAS, on July 3, 2007, courtesy copies of the Notice of Motion,
supporting Affidavit of Dennis C. Vacco and this Court's scheduling order were
sent to Clive Cummis via overnight delivery service.
WHEREAS, neither this Court nor the moving party received any pleadings
from the Defendants/Judgment Debtors at any time prior to the commencement of
the scheduled hearing. Furthermore, the Defendants/Judgment Debtors failed to
contact the Court as directed in the aforementioned Order of June 29, 2007 to
obtain the teleconference information.
WHEREAS, the attorney representing the Plaintiffs advised the Court that
on July 6, 2007, he provided the teleconference information to Mr. Block via
email and included a telephone number to which a facsimile transmission of any
responding papers could be sent by 5:00 PM on July 8, 2007.
WHEREAS, on July 9, 2007, this Court held a telephonic hearing on the
pending motion to (1) amend the caption of the Default Judgment Order by
substituting "Harrah's Operating Company, Inc." for "Park Place Entertainment
Corporation" as the first-named Defendant/Judgment Debtor and (2) determine the
law applicable to the calculation of interest on the Default Judgment Order.
Harrah's Operating Company, Clive Cummis, attorney Buffalo and attorney Block
all failed to participate in the hearing or otherwise submit any papers in
opposition to the pending motion.
WHEREAS, this Court possesses inherent authority to amend the caption of
the Default Judgment Order to reflect that Harrah's Operating Company, as the
successor in interest through merger to Park Place Entertainment Corporation, is
now a judgment debtor.
WHEREAS, the rate of interest earned on unpaid money judgments under
Tribal law has never previously been determined by this Court and there is
nothing in the United States Constitution or federal Indian law that deals with
the rate of interest earned on money judgments issued by Tribal Courts. Further,
no unwritten law, custom or tradition of the St. Regis Mohawk Tribe has been
presented to this court as guidance on this issue.
4
WHEREAS, this Court may, in the absence of any applicable written Tribal
law and in the exercise of its discretion, apply New York State law as Tribal
law for the purpose of determining the interest earned on the Default Judgment
Order.
NOW, THEREFORE, based upon the facts adduced at the hearing, the papers
submitted in support of the motion, and the proceedings heretofore had herein,
it is hereby
ORDERED, that the caption of the Default Judgment Order is amended to
substitute "Harrah's Operating Company, Inc." for "Park Place Entertainment
Corporation" as a named Defendant/Judgment Debtor; and it is further
ORDERED, ADJUDGED AND DECLARED, that sections 5003 and 5004 of the New
York Civil Practice Law and Rules shall be applied as Tribal law for the purpose
of calculating interest on the Default Judgment Order. Pursuant to CPLR 5004,
interest on the Default Judgment Order shall be calculated from the date of
entry of the Default Judgment Order at the annual rate of nine percent. The
annual interest on the $1,787,000,000 Default Judgment Order is $160,830,000.
Interest will continue to accrue until the Default Judgment Order is satisfied.
As measured from the March 20, 2001 date of entry until July 9, 2007, total
accrued interest on the Default Judgment Order is $1,013,889,945.54.
DONE AND DATED this 12th day of July 2007.
By: /s/ Wes Williams Jr.
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Wes Williams Jr.
Chief Tribal Court Judge
St. Regis Mohawk Tribal Court
Dates Referenced Herein and Documents Incorporated by Reference
