Claridge, Atlantic Club Owners Lose Deed Restrictions Appeal

A New Jersey court denied a legal crapshoot by the owners of two former Atlantic City casino hotels who want to remove anti-gambling deed restrictions on their properties.

However, the owners of the Claridge Hotel and the former Atlantic Club Casino Hotel say they intend to keep fighting for the return of casino gaming at their properties.

An appellate court denied a motion filed by Colosseo Atlantic City, Inc. (Atlantic Club) and TJM Atlantic City, LLC (Claridge) to have the judiciary intervene in a ruling issued by state gaming regulators last year.

Rejected recommendation to lift deed restrictions

The issue arose from the NJ Casino Control Commission’s decision to not require the removal of deed restrictions on three former Atlantic City casino hotels when the regulatory agency approved the merger of Eldorado Resorts and Caesars Entertainment in August 2020.

The NJ Division of Gaming Enforcement and an independent economist both advocated lifting the deed restrictions on the Claridge, Atlantic Club, and Showboat Hotel Atlantic City.

Executives representing the new Caesars Entertainment agreed to lift the restrictive covenants as a condition of the merger’s approval.

Ultimately, the CCC imposed 39 conditions as part of the merger agreement but elected not to lift the outstanding deed restrictions.

Commission Chairman James Plousis said that doing so would “greatly complicate” the Eldorado/Caesars deal and that it was an “academic exercise seeking to remedy perceived ills” unrelated to the merger. Plousis said the issue warranted further discussion among all stakeholders.

Claridge, Atlantic Club owners vow to fight on

Colosseo and TJM filed an appeal in September, alleging the CCC acted “arbitrarily, capriciously and unreasonably” in rejecting the recommendations.
The NJ Appellate Division dismissed the appeal in December, according to court documents recently obtained by Play NJ.

Click here to view NJ Appellate Division denial.

“We are disappointed and disagree with the Appellate Court’s decision,” the two companies said in a joint statement. “We believe the deed restrictions are anti-competitive and plan to pursue all legal remedies to allow gaming at our properties.”

The CCC declined to comment.

Former Atlantic City casino hotels are three of a kind

The former Atlantic Club has been closed since 2014. TJM sold the property to Colosseo in 2019.

The Claridge has been operating as a standalone hotel property since 2014.

The Showboat did not join the appeal. The former casino property is the only one of the three to explore becoming a gambling parlor again. Bart Blatstein, the Philadelphia-based developer who owns Showboat, has been cleared to apply for a casino license.

Despite claiming that he would circumvent the deed restriction and construct a new casino facility next to the Showboat, Blatstein has since turned his attention to constructing an indoor water park instead.