On April 1, 2019, a federal court in Chicago approved a $50.5 million settlement of claims obtained by Hughes Socol Piers Resnick & Dym, Ltd. (“HSPRD”) and Jenner & Block for their client Frances F. Gecker, the Chapter 7 bankruptcy trustee for Emerald Casino (“Emerald”), resolving claims against the successors in interest of the late CEO of the Emerald, Chicago venture capitalist, Kevin F. Flynn (“Flynn”). Flynn was a son of the late Donald F. Flynn, the former CEO of Waste Management Corp., and a venture capitalist who held controlling interests in many major companies including Blockbuster Video.The settlement is the latest chapter of more than a decade of litigation stemming from the revocation by the State of Illinois of the operating license of the Emerald Casino, which was being built in Rosemont, Illinois, and was projected to become the most profitable casino in the nation. The litigation produced prior settlements with other parties totaling over $57 million and a residual judgment in the amount of approximately $220 million against Flynn and the remaining defendants.In 1999, the Illinois legislature enacted a law which allowed one of Illinois’ ten casino operating licenses to be relocated anywhere in the State of Illinois, including to Cook County, where casino gambling was and is otherwise illegal. Development of the casino in Rosemont, adjacent to O’Hare Airport, was halted as a result of Illinois Gaming Board (“IGB”) regulatory action in January 2000. In December 2005, following an extensive IGB investigation and protracted administrative hearings before retired federal judge Abner J. Mikva, the IGB revoked the Emerald license, finding extensive misconduct on the part of Emerald’s principals, including Kevin Flynn, who was found to have lied to the IGB about his involvement in Emerald.In 2006, Matthew J. Piers of HSPRD filed the original lawsuit on behalf of the minority and women investors, whose claims were later transferred to the bankruptcy trustee. The litigation proceeded to two lengthy trials in bankruptcy and federal court. In 2016, settlements were reached with the estate of Donald Flynn and another defendant, totaling approximately $57 million.In 2018, proceedings were initiated to turnover the assets of a spendthrift trust which held substantially all of Flynn’s financial assets. The trial was underway when the $50.5 million settlement was reached.Matthew Piers, lead counsel for the minority and women investors, said: “Kevin Flynn lived a life of extravagant wealth and an abiding aversion to compliance with the law. His misconduct was a major cause of the loss of the license to operate the Emerald Casino, resulting damages of over thirty million dollars in investment losses suffered by the minority and women investors. He misused his spendthrift trust to fraudulently conceal his assets from his creditors. Finally, his estate will pay meaningful compensation to his long-suffering victims.”For more information about the settlement, please contact Matthew Piers at (312) 604-2606.
