Federal judge upholds state casino law

A federal judge has upheld Massachusetts’ casino law as constitutional, deciding against a casino developer that had challenged the state statute over its deference to Native American tribes.

In a decision issued Thursday, US District Judge Nathaniel Gorton said he found no constitutional violations in the casino law or in the state gambling commission’s ongoing review of commercial casino applications.

The two-year-old lawsuit by KG Urban Enterprises dates back to the day Governor Deval Patrick signed the casino legislation in November, 2011.

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The law creates licenses for up to three resort-style casinos, no more than one in each of three regions of the state. The law delayed bidding on the commercial casino license in the southeast region to give a federally recognized tribe — presumably the Mashpee Wampanoag — time to make progress on developing a tribal casino in the region. KG, a development firm that wants to build a commercial casino in New Bedford, has argued that the delay is discriminatory and amounted to a racial bias in favor of Native American tribes.

Gorton in 2012 upheld the state casino law and dismissed KG’s challenge, but a federal appeals court later revived the suit and sent the matter back to the lower court for more hearings.

KG, in a statement, said company officials believe Judge Gorton’s latest ruling misconstrues the appeals court decision. “We have already filed a notice of appeal with the First Circuit,” the company said.

Last year, the state gambling commission opened the southeast region to commercial bidders; KG was the only company to submit an initial application, though several companies that unsuccessfully applied for other state gambling licenses could still propose casino projects in the region.

The Mashpee are pursuing a casino in Taunton under a federal process, separate from the state casino licensing competition. The tribe faces significant legal obstacles to federal approval.