PokerStars: We’re “Committed to New Jersey”

A NJ judge swung the advantage to the Atlantic Club Casino with a Friday ruling overturning the restraining order preventing the ACC from breaking their contract with PokerStars.

But PokerStars may be digging in for an extended battle.

At least that’s what I read between the lines of PokerStars’ official statement on the ruling:

RE TODAY'S NJ HEARING: We are reviewing today's ruling. We remain committed to New Jersey and to contributing to its economy.

— Eric Hollreiser (@erichollreiser) May 17, 2013

It’s not hard to think of reasons why PokerStars would continue to aggressively pursue the issue despite Friday’s setback.

Off the top of my head:

• They’ve already put over $10mm into the purchase. A few million more in legal fees will be easy to justify.
• They may be forced to write a $4mm check to the ACC for a termination fee if the deal officially falls apart. I’d bet they’d rather spend five times that if it meant never having to give the ACC another dime.
• New Jersey still represents one of the best chances for PokerStars to return to the US market.
• According to all involved, PokerStars seemed very confident of their approval by New Jersey regulators. It’s unimaginable that PokerStars would quietly walk away from such an excellent opportunity for that type of official regulatory approval.
• The whole thing feels pretty personal at this point.

I’d expect relatively quick action from PokerStars, who I’d imagine will to do their best dissuade any alternative suitors for the ACC with the threat of protracted legal wrangling.

But PokerStars pursuing additional action shouldn’t be equated with a chance that the deal can be resuscitated via the courts. And there are also well-reasoned arguments as to why PokerStars might just pack up and move on:

@opreport PokerStars’ short-term legal options v. ACC are quite limited. More likely to see Stars find another option to enter NJ market.

— Michael M. (@Grange95) May 21, 2013

@opreport Any hearing/trial on merits of PS claim for reimbursement of advances is months away. An appeal of order denying TRO … (1/2)

— Michael M. (@Grange95) May 21, 2013

@opreport (2/2) would be interlocutory w/ very slim chance of success, and again months away. PS can’t prevent ACC sale at this point.

— Michael M. (@Grange95) May 21, 2013

@opreport Stars’ claims v. ACC will be factored into any purchase price as contingent liability w/ substantial discount b/c of court ruling.

— Michael M. (@Grange95) May 21, 2013