MTR Gaming Group sues Arneault over links to Western Pa. racino plan

By VICKI SMITH

Associated Press

MORGANTOWN, W.Va.

MTR Gaming Group Inc. is suing former chief executive Ted Arneault, accusing him of violating a noncompete agreement by getting involved with a harness-racing company that plans to open a racetrack and casino near New Castle, Pa.

His lawyer on Monday called the lawsuit baseless and said it was filed with the wrong court for the wrong reasons.

Filed Friday in U.S. District Court in Erie, Pa., the case accuses Arneault of sharing strategies and trade secrets with American Harness Tracks LLC before the expiration of two noncompete agreements he reached in settlements with MTR, a West Virginia-based gambling company.

The latest agreement had prohibited Arneault from competing within 100 miles of any MTR property before April 30, 2011.

MTR claims newly revealed documents show that Arneault has been working with American Harness since at least September 2010, about eight months before the expiration of that agreement.

American Harness plans to build a racetrack and casino near New Castle, in Lawrence County, Pa., that would compete with MTR’s Presque Isle Downs and Casino near Erie.

But Arneault’s attorney, John Mizner, dismissed the lawsuit as “yet another desperate attempt ... to cause Mr. Arneault continuing financial damage and to stop him from ever re-entering the gaming business.”

“AHT owns acres and acres of fields, and not a single slot machine or table game,” Mizner said. “AHT is years away — years away, if ever — from being in the gaming business. Therefore, AHT cannot and is not competing with MTR.”

MTR also owns Mountaineer Casino Racetrack & Resort in Chester, W.Va., and Scioto Downs, a harness- racing track in Columbus.

Arneault ran MTR when it won a license in 2006 to build Presque Isle and quit in 2008 after 13 years at the helm.

The lawsuit claims he’s been using “strategies, models, designs and plans developed by MTR” to compete with his former employer and that he’s shared unspecified “proprietary trade-secret information” in violation of their agreement.

MTR says the financial harm it has suffered is difficult to quantify, but it asks a judge to compel Arneault to disclose the extent of his communication and involvement with American Harness, and to return all confidential documents.

The complaint also asks the court to extend the duration of his no-compete clause and to award unspecified compensatory and punitive damages.