Las Vegas-based casino supplier Galaxy Gaming Inc. on Tuesday stepped up its defense against a Bank of America lawsuit, publishing an open letter on its website to the bank’s CEO complaining about the legal action.
Galaxy Gaming, which makes table games, was sued in October in Clark County District Court over claims by the bank that it was involved in a fraudulent transfer of assets backing a $1.1 million B of A loan and that false information was submitted to the bank in the loan application.
Galaxy and its CEO, Robert Saucier, have denied the allegations and Galaxy hit the bank with a counterclaim last month. The counterclaim said the suit has harmed the company because of media attention and unnecessary scrutiny by gaming regulators.
Today, Saucier posted a letter to Bank of America CEO Brian Moynihan complaining about the legal action and noting the loan in question has been current with no missed payments.
Besides Bank of America’s allegations of misrepresentations and a fraudulent transfer, the suit also involves concerns that declining property values in Las Vegas have reduced the value of the collateral backing the loan. That collateral is the Galaxy Gaming headquarters office space, which the company has been leasing from a trust benefiting relatives of Saucier.
“Our local real estate market crashed (in 2008), resulting in countless foreclosures and in our case, a building worth a fraction of its former value. While, we were troubled by the chaotic nature of B of A’s affairs and the reality that the building was suddenly ‘underwater,’ we sustained our commitment to you and faithfully made each and every payment as agreed,” Saucier wrote in today’s letter. “Unfortunately, our loyalty to you was not returned. Imagine our shock and disbelief when we discovered that your bank filed a lawsuit against our company, pertaining to a performing loan. This action was without any justification and is damaging to our good name.”
Asked about the Galaxy Gaming letter to its CEO, Bank of America said in a statement: "It would be inappropriate to comment because we are involved in litigation against Galaxy Gaming seeking payment of defaulted debt."