Indian Gaming Now

Archive - May 7, 2010

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Federal Court Decision on Tribal Debt

May 7 2010
A federal court voided a tribe's $50 million bond debt, a controversial and significant development in the unmapped area of tribal finance and federal law.  The Lac du Flambeau Chippewa Tribe in Wisconsin, through its Lake of the Torches Economic Development Corporation, in 2008 had entered into a deal -- a trust indenture -- with Wells Fargo Bank to refinance and expand the Tribe's Grand Soleil casino project in Natchez, Mississippi.  The Grand Soleil project, in the works since 2005, hit hard times.  As a result, the Tribe wasn't able to make the promised bond payments due under the trust indenture.  The bond was secured by the Tribe's revenue at its Lake of the Torches Resort Casino in Vilas County, Wisconsin.  Wells Fargo sued the Tribe for breach of the deal,