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Ledyard offers to settle slot-machine tax case for $875,000

The town of Ledyard would accept $875,000 as reimbursement for attorney's fees it paid in pursuing property taxes it levied more than a decade ago on slot machines a Chicago-based company leased to Foxwoods Resort Casino.

In a two-paragraph “offer of compromise” filed this week in New London Superior Court, an attorney for the town, Lloyd Langhammer, wrote, “The Plaintiff offers said sum to settle the claim...”

Langhammer said months ago he would argue the town is entitled to interest on the attorney's fees, increasing its claim to millions of dollars.

Langhammer's earlier comments came after a unanimous state Supreme Court decision found that WMS Gaming, the slot-machine company, was liable for attorney's fees the town incurred in both state and federal court actions even though the town's suit against WMS was confined to state court. In the decision, Chief Justice Richard Robinson cited a provision in state law “allowing trial courts to award to a municipality ‘reasonable attorney’s fees incurred by such municipality as a result of and directly related to such levy and sale, enforcement of lien or other collection proceedings.”

The Supreme Court decision reversed a state Appellate Court decision that had reversed a Superior Court ruling.

Langhammer estimated the town had incurred a total of $1.8 million to $2 million in attorney's fees. He said he would argue that under state statutes, the town is entitled to 18% interest on the fees, which would increase the amount the town could seek in reimbursement to as much as $5 million.

Ledyard Mayor Fred Allyn III said at the time he believed the amount the town could seek was closer to $6 million.

Langhammer said Wednesday the town made the compromise offer in a bid to settle the case and because there was no guarantee that a judge would agree the town is entitled to interest on the attorney's fees it incurred over the years. Interest on the town’s $875,000 offer could accrue, if WMS rejects it and the litigation continues, he said.

Aaron Bayer, an attorney for WMS Gaming, said he could not comment on the town’s compromise offer.

Ledyard’s Superior Court case against WMS Gaming dates to 2008, when it claimed the company owed the town $18,251 in unpaid taxes on slot machines the company owned and leased to Foxwoods. Two years before, the Mashantucket Pequot Tribe, which owns Foxwoods, had filed a federal lawsuit claiming the town had no authority to tax slot machines the tribe leased from a different company and operated at Foxwoods, which is situated on sovereign land. The tribe filed a second federal suit after the town sued WMS Gaming.

In 2012, a federal judge ruled in favor of the tribe but the 2nd U.S. Circuit Court of Appeals reversed the decision the following year. WMS Gaming paid the delinquent tax bill, which grew to more than $372,000, in 2014.

b.hallenbeck@theday.com

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