Legal costs in Duluth casino court battle passes $1 million

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The cost of Duluth’s ongoing legal battle with the Fond du Lac Band of Lake Superior Chippewa continues to mount. On Monday, the Duluth City Council voted to authorize boosting its legal budget for the case by another $300,000, bringing the total to a maximum of $1.06 million.

The legal firm of Maki and Overom has agreed to take the case on contingency and will not be paid for its services unless it is successful in obtaining a settlement or judgment in favor of the city.

The case involves a revenue-sharing agreement with the band that sent 19 percent of gross revenues from the Fond-du-Luth Casino to the city. In August 2009, the band stopped making these payments after deeming its financial agreement with Duluth unlawful. The National Indian Gaming Commission backed up the band with a ruling in July. But the case continues to be played out in the federal courts.

Councilor Jim Stauber cast the sole vote against approving additional legal funding for the case, with councilor Patrick Boyle abstaining because of his employment by the band.

“I have objections to proceeding down this path,” Stauber said. “There is no cap on what Overom and Maki can earn.”

Councilor Jay Fosle said that given the magnitude of the case, the city has little choice but to engage the best legal counsel available.

“There’s $150 million at stake here,” he said, adding that he would be willing to spend as much as the full $6 million the city typically receives from the band in a year of casino operations to successfully resolve the case.

Councilor Todd Fedora said the band is now nearly $12 million in arrears in its payments to the city. Fedora pointed out that the city relies on casino revenues for about 70 percent of its street improvement budget.

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