Log In


Reset Password
  • MENU
    Local News
    Sunday, May 05, 2024

    Ledyard still seeking $1.5 million in attorney's fees in Mashantucket tax case

    The Town of Ledyard is still seeking to recover more than $1.5 million in attorney’s fees it incurred in defending a federal lawsuit over its right to tax leased slot machines at Foxwoods Resort Casino.

    In a 2013 decision that reversed a U.S. District Court ruling in the Mashantucket Pequot Tribe’s favor, the 2nd U.S. Circuit Court of Appeals found that Ledyard can levy personal property taxes on the nontribal owners of slot machines leased by the Mashantuckets, who own Foxwoods. The tribe had filed the suit in 2006, challenging the town’s imposition of taxes on Atlantic City Coin & Slot Co.

    Two years after the federal suit was filed, Ledyard sued another slot-machine vendor, Illinois-based WMS Gaming, in New London Superior Court. The town sought to collect $18,250 in taxes and interest unpaid as of June 1, 2008. As the suit languished, the amount WMS owed grew, and in 2014 the vendor issued the town a check for $372,629 for "outstanding taxes, interest and penalties."

    The Superior Court case is scheduled for a hearing next week.

    Still unresolved is Ledyard’s claim that WMS owes the town more than $1.5 million in attorney’s fees related to the federal suit — even though WMS was never a party to the federal suit.

    When the tribe learned that the town had sued WMS over the same type of tax the tribe was challenging in federal court, the tribe filed a second federal suit against the town. Identical to the tribe’s suit over the town’s bid to tax Atlantic City Coin & Slot, the second federal suit eventually was consolidated with the first.

    The town, represented by New London attorney Lloyd Langhammer, claims that under state statutes, WMS is required to pay attorney’s fees the town incurred in the consolidated federal case.

    An attorney for WMS, David Williams of Brown Jacobson in Norwich, wrote in a 2014 filing that the town’s claim is “patently implausible and should be denied.”

    “The remaining issue,” Langhammer wrote in a filing last week, “is the amount of attorney’s fees which the defendant is obligated to pay. ... The Town of Ledyard, in an amount to be proven at trial, is seeking well in excess of $1,500,000 in legal fees.”

    Ledyard’s tax collector, Joan Carroll, could not say how much the town has collected in taxes on leased slot machines since the 2013 appeals court decision. Several vendors, she said, have paid such taxes in recent years, including WMS Gaming, which she said has paid nearly $16,000 in taxes in the current year. Atlantic City Coin & Slot is no longer in business.

    b.hallenbeck@theday.com

    Twitter: @bjhallenbeck

    Comment threads are monitored for 48 hours after publication and then closed.