A big Nevada sports book company is butting heads in court with a competing executive over allegations he breached non-compete and confidentiality obligations.
The owner of Cantor Gaming on Tuesday sued a former executive, Joseph Asher, whom Cantor says left Cantor in 2007 and went on to develop the Las Vegas-based Brandywine Bookmaking and Lucky’s Race and Sports Book chain — and now plans to sell that chain to British bookmaker William Hill for $15.7 million.
Tuesday’s lawsuit was filed in Clark County District Court as Cantor Gaming faces intense competition from William Hill, which is also buying the local Leroy’s sports betting chain owned by American Wagering Inc.
Asher on Wednesday denied the allegations in the lawsuit.
"I left Cantor over four years ago and Brandywine has been operating for over three years. Cantor didn't file its complaint until after we signed a deal to sell the company to William Hill. The timing says a lot. Any allegation that I have done anything wrong is ridiculous and totally false," Asher said.
Brandywine, operating as Lucky's, has 16 Nevada locations.
In Southern Nevada, they are at two Terrible’s casinos in Pahrump; the three Primm casinos owned by Affinity Gaming LLC; at the Pioneer and River Palms casinos in Laughlin; and at Fitzgeralds, the Plaza and Terrible’s in Las Vegas. Another book is being developed by the company at the Riviera in Las Vegas.
Cantor, represented by Las Vegas law firm Lionel Sawyer & Collins, laid out the following sequence of events in its lawsuit:
After working with Wall Street investment company Cantor Fitzgerald L.P. for more than a decade as an outside attorney, "Asher was given the opportunity of a lifetime — to participate as a partner in Cantor’s high technology entry into the gaming industry.’"
In September 2004, Asher accepted a limited partnership interest in Cantor company CGW Holdings and served as managing director and vice president of another Cantor company, CGW Nevada.
He "became privy to Cantor’s revolutionary ideas in mobile gaming and sports wagering" and "was subject to a contractual duty of loyalty that included stringent non-compete obligations in favor of both CGW Holdings and CGW Nevada," the suit says.
Over the next three years, Asher was Cantor’s point man in obtaining gaming licenses and negotiating with casino operators on potential sports betting deals, the suit says.
Asher resigned in March 2007 and "began a concerted effort to establish a gaming enterprise through the improper usurpation of proprietary ideas and corporate opportunities that rightfully belonged to" the Cantor partnerships, the suit charges.
"Asher diverted profitable business opportunities with Navegante Group, a well-respected casino services provider," the suit charges. "Asher’s diversion of Navegante also had the effect of delaying CGW Nevada’s commencement of sports wagering operations by several months.’’
"On behalf of the CGW Partnerships, Asher was spearheading discussions about specific locations with Navegante throughout 2006 and early 2007,’’ the suit says. ``Representatives of Navegante were in communication with Asher concerning sports wagering at Navegante locations as late as one week prior to Asher’s sudden departure.
"Asher usurped this opportunity for himself and his Brandywine entity. Asher and Brandywine entered into an arrangement with Navegante to conduct sports wagering at facilities managed by Navegante, including the Red Lion Hotel & Casino in Elko, the Grand Sierra Resort & Casino in Reno, the Plaza Hotel & Casino in Las Vegas and Casino Fandango in Carson City.
"But for Asher’s usurpation of CGW Nevada’s corporate opportunities and Asher’s violation of his fiduciary and non-compete obligations to the CGW Partnerships, CGW Nevada would have been able to conduct sports wagering operations at these facilities," the suit charges.
Cantor now fears Asher as CEO of Brandywine will go to work for William Hill and "attempt to divert" business opportunities from Cantor to William Hill, the suit says.
The suit also alleges Asher has failed to pay the outstanding principal and accrued interest on two loans from Cantor. The value of those loans wasn’t specified in the complaint.
Cantor’s lawsuit asks the court to impose a constructive trust on the proceeds of the Brandywine sale to William Hill and to award Cantor unspecified damages.