Borgata Sues Ocean Casino, Alleges Atlantic City Resort Poaching Its Executives

Posted on: August 29, 2020, 09:46h. 

Last updated on: August 31, 2020, 02:45h.

Borgata has brought a lawsuit against Atlantic City competitor Ocean Casino on allegations that the boardwalk resort has poached its marketing executives and stolen its trade secrets.

Ocean Casino Resort Borgata Atlantic City
Ocean Casino Resort has brought several former Borgata marketing leaders to its Boardwalk property, and that has MGM Resorts in an uproar. However, these slots with a view seemingly market themselves. (Image: Ocean Casino Resort)

Filed in the US District Court of Nevada, MGM Resorts, the parent company to Borgata, argues Ocean Casino has unlawfully hired several of its former marketing executives. MGM says Ocean has hired six ex-Borgata execs, at least two of which have violated their one-year non-compete agreements.

Ocean is in the process of raiding Borgata’s casino marketing department. Injunctive relief is necessary because all informal efforts to resolve the dispute and protect Borgata’s business from irreparable harm have failed,” the lawsuit contends.

Borgata has long dominated the Atlantic City gaming industry. In terms of brick-and-mortar gambling, slot machines and table games, the Marina District casino held a 26.4 percent market share in 2019. The MGM gaming floor won $709.5 million of the market’s $2.8 billion wins. Hard Rock was a distant second at $324 million.

Of the nine casinos, Ocean ranked No. 6 at $215.7 million.

People Poacher

MGM’s lawsuit primarily focuses on two of its former marketing executives: Kelly Ashman Burke, who was Borgata’s executive director of marketing, and William Callahan, who was the resort’s vice president of relationship marketing.

MGM alleges that, following the termination of Burke’s employment agreement, Ocean quickly offered her a job. She brought to Ocean “her unique access and intimate knowledge of Borgata’s marketing strategies and customer loyalty databases.”

MGM claims Callahan was wooed away from Borgata by Ocean in the midst of his ongoing employment contract. He took with him his Borgata company cell phone and “all of the trade secrets stored therein.”

Lawyers for MGM say Callahan and his counsel have refused to return the phone. They add that both Burke and Callahan are in violation of their non-competes.

“In a transparent ruse to circumvent his non-competition obligations, Ocean gave the career casino marketing executive the title of ‘SVP of Hotel Operations’ despite the fact that during his 18 years of work at Borgata, he had never overseen hotel operations, never overseen housekeeping, never overseen front desk, bell desk, or janitorial serves (all of which are core hotel functions),” the lawsuit challenges.

Three Others, Too

Borgata believes Ocean Casino has developed a concerted effort to obtain its trade secrets and VIP players to better compete with the market leader.

The lawsuit says Burke and Callahan know how MGM caters to its high rollers and knows specifics on each VIP’s gambling preferences, food and beverage likes and dislikes, and comps typically afforded to them by the casino.

MGM asserts Ocean has hired away several other Borgata marketing executives since bringing Burke and Callahan to the Boardwalk.

“The near simultaneous solicitation and hiring of these individuals — all of whom are subject to statutory and common law trade secret restrictions — to work in positions which will require the immediate misuse of those trade secrets and other confidential and proprietary information demonstrates Ocean’s intention to cripple Borgata’s casino operation and misappropriate both Borgata’s business relationships and its trade secrets and other confidential and proprietary information,” the lawsuit concludes.

Reps for Ocean said they do no comment on ongoing legal matters.