LAS VEGAS, Nev. – A bankruptcy judge has allowed an arm of casino giant Caesars Entertainment Corp. to tear up contracts it had with the Kansas City Chiefs, a hotel in Louisiana and an audio company as it looks to shed millions of dollars of costs.
The deals involved renting a suite at the football team’s stadium sometimes used as a perk for its gambling customers, buying a guaranteed block of rooms each month at the Springhill Suites next to the company’s Louisiana Downs Racetrack and Casino for its patrons and selling promotional space to Monster Inc. to market its audio products at a Britney Spears show at Planet Hollywood.
Judge Benjamin Goldgar in Chicago ruled last week that Caesars Entertainment Operating Co. could void the agreements as part of its bankruptcy case but the company would have to try again if it wants to void agreements it has with the New York Mets, The Forum in Los Angeles and a motor coach company because it didn’t give them enough notice last time.
The suite for Chiefs games costs $12,000 a month. The stadium is keeping Caesars’ $12,580 security deposit but letting it use the suite one more time on Aug. 1 for a Kenny Chesney and Jason Aldean concert, according to the judge’s order.
The room reservation agreement it had with the 150-room Springhill Suites near its Louisiana casino had cost it $310,000 a month. A lawyer representing the majority owner of the hotel wrote in an objection to the court that the hotel depends on the casino’s guests.
“Without these guests, the hotel will not survive,” said Sara Lorber in the February filing. A subsidiary of Caesars Entertainment Operating Co., also a debtor in the bankruptcy case, owns the other 49 per cent stake in the hotel.
Caesars Entertainment Operating Co. filed for bankruptcy protection in January in an effort to shed some $10 billion in debt.
Its sponsorship agreement with the Mets costs it $203,000 a month and advertising at The Forum costs $60,000 a month. An agreement with a motor coach company costs $90,000 a month to arrange group trips to its Horseshoe Bossier City properties in Louisiana.
Caesars also got assurance from the court that an agreement it had with audio company Monster Inc. is over and the casino company can still seek a legal claim against it. Court records indicate that Monster defaulted on the agreement after tensions arose between it and performer Britney Spears over where the company could sell its products at her show at Caesars’ Planet Hollywood property.