SPIVAK & BICE

Trying to win big off failed casino project

Chicago pol Morgan Murphy Jr. is rolling the dice one last time in his never-ending quest to score some big bucks by turning Kenosha into a casino town.

The former Illinois congressman's company, Nii-Jii Entertainment, is barely breathing and has almost nothing in the bank. But that won't stop this group from trying to collect on its failed attempt to open a casino at Kenosha's Dairyland Greyhound Park.

You see, while its bid went down in flames, Murphy & Co. salvaged one golden asset -- a non-compete clause preventing the Menominee tribe from teaming up with anybody else to operate a Kenosha casino.

That could be a huge problem for the Menominee tribe in its latest effort to open an off-reservation casino. In January, the tribe hooked up with the Mohegan tribe, which runs a successful Connecticut casino, and local trucking magnate Dennis Troha, who is also a Nii- Jii shareholder.

Sources say Nii-Jii initially asked the Menominee for tens of millions of dollars to go away, though a negotiated payment in the $10 million neighborhood seems more realistic.

"It's going to have to be dealt with," said one source with knowledge of the suit. "They certainly can throw a wrench into the works."

Still, the tribe is not about to roll over.

Evan Zeppos, who's flacking for both the tribe and the proposed casino project, said the Menominee doesn't believe the non-compete is legally binding. The loophole: The first Kenosha project died before the Nii-Jii agreement was approved by federal authorities, Zeppos argued.

That hasn't stopped the two sides from privately talking about the issue.

Transcripts of an August hearing in a Nii-Jii shareholder lawsuit show that Murphy's lawyer, Frank T. Crivello, made clear Nii-Jii would be more than willing to throw a roadblock in front of the newest casino dream.

"Do you think that the tribe, judge, is willing to talk to us because they happen to like Sicilians?" Crivello asked Racine County Circuit Judge Gerald Ptacek. "No. It's because I hold in my hand the ability to tie up this casino development for three years."

The non-compete clause was debated at length during the hearing in what is a 3-year-old lawsuit over how to split up any assets that Nii- Jii may still have. In the 1990s, Nii-Jii teamed up with the Menominee in its effort to buy the struggling dog track and turn it into a gambling mecca -- a campaign backed by some of the heaviest hitters in Kenosha, including Troha, attorney Joe Madrigrano and former Sen. Joseph Andrea, who died in 2002.

That bid fell apart as questions about Morgan's background surfaced and then-Gov. Scott McCallum said he would veto any bid to open an off-reservation casino in Wisconsin.

But the idea came back to life this year when Troha -- a big-time contributor to Gov. Jim Doyle -- teamed up with the Menominee and Mohegan tribes to give another whirl at setting up a casino aiming to rake in profits from both the Chicagoland and metro Milwaukee markets.

Just how lucrative is the Chicago market? Records show that the riverboat casino in nearby Elgin, Ill., collected more than $265 million in gaming revenue during the first eight months of this year.

Negotiations to collect on the non-compete clause started right after the new casino proposal was made public. Lord knows, Nii-Jii -- which Murphy has said spent more than $10 million on its failed casino bid -- needs the money.

"Everybody knows the corporation is insolvent," said George Kersten, who represents dissident shareholders, in the August hearing. "Everybody knows it's in the interests of Nii-Jii to advance negotiations with the Indians."

Theodore Hodan, who oversees Nii-Jii as its court-appointed receiver, agreed that Nii-Jii's till is nearly empty.

"I have a check for $2 in the file," Hodan told the courtroom. "That's the only asset that I have been able to come up with."

Just like a lot of broken-down gamblers -- two bucks to its name, with dreams of hitting the jackpot.

Upon further review

U.S. Senate candidate Tim Michels has a few more bucks riding on China than we originally thought.

The other day we reported that Michels had between $50,000 and $100,000 invested in the Templeton China World Fund on behalf of his children. At the same time, though, the Oconomowoc Republican spends a good chunk of his time on the campaign trail blaming China for costing American jobs and threatening to yank the country's preferred trading status if it doesn't play by the rules.

Well, we were wrong.

Documents filed with the feds show Michels actually has between $100,000 and $200,000 in the China fund in two separate accounts for his kids. On top of that, he has between $30,000 and $100,000 in the Templeton Emerging Markets Fund, a diversified mutual fund that has nearly 11 percent of its assets invested in China.

------------

Cary Spivak and Dan Bice can be contacted by phone at (414) 223- 5468 or e-mail at sb@journalsentinel.com.

Copyright 2004 Journal Sentinel Inc. Note: This notice does not apply to those news items already copyrighted and received through wire services or other media
Provided by ProQuest Information and Learning Company. All rights Reserved.