Springfield Wants to Go Public with MGM Casino Dispute

A Massachusetts city isn’t keen on allowing MGM Resorts International to sell its land-based casino property.

Springfield, home of the aptly-named MGM Springfield casino, argued in the state Superior Court on Wednesday that its legal squabble with the gaming company should be moved from closed-door arbitration to a public court format.

The dispute relates to Springfield’s claims that MGM did not fulfill the obligations it promised when it opened the property in 2018.

MGM Springfield feud gets ugly

The Massachusetts case is an intriguing scenario. Springfield doesn’t want to allow MGM to sell its operating rights to the property, even though a different company would take over operations. Meanwhile, MGM wants to cut ties with what  has been an underperforming property.

Counsel for the city on Wednesday asked Judge Jeffrey Trapani to move the ongoing debates into the public eye so that local residents can be privy to everything being discussed in arbitration.

Reports surfaced in early 2024 that MGM was mulling the sale of its Springfield location. Local officials informed the gaming and entertainment company that it would be held to the terms of the host city agreement that it signed before the property opened. 

Springfield is entitled to receive $25 million in annual payments to various groups in the city and to book at least 12 acts per year to perform at venues near the casino to help drive the local economy. Springfield’s then-City Council President Michael Fenton said that a potential buyer would be held to the same expectations.

The host agreement also awards some pull in determining which company operates the casino.

MGM has a much different perspective. It argued in arbitration that the city owes $500 million in damages for blocking the company’s attempts at selling the casino for the last two years, causing it to lose out on money from a potential sale while being forced to pay to continue operations at the property.

Finding a new operator

MGM Springfield — which cost $960 million to open — has not found the success that its parent company expected it would. That’s part of the reason the company wants to move on from the property.

To add to the ongoing conflict, MGM already has an interested buyer for the property: Canadian private equity firm Clairvest, which last year purchased the rights to MGM Northfield Park racino in Ohio.

Springfield isn’t keen on greenlighting a sale, however. It claimed that MGM did not uphold its promise to staff at least 3,000 employees and host 2,800-3,000 gaming machines, including slot machines, and 75-100 table games.

Estimates suggest that MGM could receive about $500 million for selling the casino’s operating rights. It would also free the company from a $30 million annual rent payment it owes to VICI Properties.

Springfield officials previously said that MGM would need to find an operator of its “same pedigree” in the event that it sold the casino.