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Cordish $600M defamation suit now in federal court

The Cordish Cos.’ defamation lawsuit against the majority owner of Indianapolis Downs LLC has been moved to U.S. District Court, District of Maryland.

The $600 million suit, which claims that the Maryland Jockey Club and Indianapolis Downs conspired to prevent Cordish from building a casino in Anne Arundel County, was originally filed Feb. 15 in Baltimore City Circuit Court.

The Maryland Jockey Club filed a motion in April to move the suit to Anne Arundel County. A hearing for that motion has been scheduled for June 13 and is unaffected by Monday’s order, said Robert J. Weltchek, of Weltchek Mallahan & Weltchek LLC, one of the attorneys representing The Cordish Cos. in the case.

“The defendants are trying to remove it from anywhere but Baltimore City,” Weltchek said.

Weltchek said that the motion to remove the case automatically moves the trusts’ portion of the case to federal district court, but that officials from The Cordish Cos. can petition to move it back to circuit court in Baltimore.

Indianapolis Downs, which operates the Indiana Downs race track and Indiana Live! Casino, filed for bankruptcy protection April 7.

Indianapolis Downs is 95 percent owned by Oliver Racing LLC, which is made up of the J. Oliver Cunningham Trust, the Anne C. McLure Trust and the Jane C. Warriner Trust. The three trusts, as well as Indianapolis Downs Chairman Ross J. Mangano, are named as defendants in the lawsuit. Mangano is trustee of the trusts and a minority owner of Indianapolis Downs.

Oliver Racing filed the notice of removal from state court April 29.

According to the suit, Indianapolis Downs agreed to retain Cordish subsidiary Power Plant Entertainment Indiana to help develop and manage Indiana Live! in 2007 for a portion of the facility’s revenues. The suit alleges that Mangano leaked false information about Cordish’s role in the project because the casino did not want to pay Cordish more than $8 million in management fees.

Indianapolis Downs reported assets in the range of $500 million to $1 billion and debts of $100 million to $500 million in its Chapter 11 petition, which it filed with the U.S. Bankruptcy Court in Wilmington, Del.

Attorneys for Indianapolis Downs LLC did not return phone messages Tuesday for comment.