The Cheyenne and Arapaho Tribes in Oklahoma have filed lawsuits against their former partner, the controversial Florida entrepreneur Fred Khalilian, claiming fraudulent gaming deals. The lawsuit was filed in a tribal court in Concho against the Universal Entertainment Group (UEG), owner Khalilian and 11 other defendants for alleged cheating to the tune of $13 million.
The lawsuit contends that UEG never had the legal rights to sell the software, as it was allegedly owned by a former business partner of Khalilan. Khalilan was successfully sued in Georgia by his former business partner but things turned complicated when the judgement was subsequently overruled.
Fred Khalilan has been in the middle of controversies on multiple occasions. In 2011, he reached a settlement with the Federal Trade Commission (FTC) over deceptive telemarketing operations.
The internet poker venture Pokertribe.com which failed to launch is categorized in the suit as a transaction that embodied greet, deceitfulness and completely disregarded the tribes financial well-being. The deal with UEG was inked way back in 2012 by the Cheyenne and Arapaho tribes seeking to setup a poker site that would cater to international poker players.
The tribes claim that they invested $9.5 million in the Pokertribes.com venture which was stopped following the election of Governor Eddie Hamilton in 2014. Hamilton said the lawsuit is based on multiple investigations into the deals that had been made by the previous government and that gaming revenues had been misused. Hamilton faces a re-election vote later this year.
In a statement Eddie Hamilton, Governor, said,
We continue to aggressively work with federal regulators and law enforcement authorities to bring about the indictment of those who have taken advantage of our tribes and misused our tribes’ gaming revenues.
The UEG group has subsequently partnered with the Iowa Tribe of Oklahoma, a federally recognized tribe to launch an online poker site similar to the PokerTribe.com failed venture. The Iowa Tribe received a license from the Isle of Man Gambling Supervision Committee last week.
Khalilan has responded to the lawsuit by alleging that it was politically motivated. Brian Foster, the former head of operations for Pokertribes.com claims that the business was a viable one and that it could have increased the tribe’s revenues had it not been abandoned. Foster who has also been named as a defendant in the lawsuit, also claimed that the lawsuit appeared to be motivated by political compulsions.
Attorney Richard Grellner, who has helped negotiate the Pokertribes.com deal has termed the lawsuit as a publicity stunt.
