Carl Icahn to Surrender Trump Taj Mahal License, Will Not Reopen Atlantic City Casino

Posted on: January 4, 2017, 03:00h. 

Last updated on: January 4, 2017, 01:53h.

Unofficial Donald Trump regulatory advisor Carl Icahn will surrender the casino license for the Trump Taj Mahal in Atlantic City, according to the New Jersey Division of Gaming Enforcement (DGE).

Carl Icahn surrendering Trump Taj Mahal gaming license
Billionaire Carl Icahn was not bluffing when he threatened to close the Taj Mahal in Atlantic City for good, nor does he intend to reopen it as a non-unionized property, per a filing with the New Jersey regulator. (Image: Chip East/Bloomberg via Getty)

Icahn shuttered the Taj in October, following months of industrial action by Local 54 of the Unite-HERE union. The union was protesting the loss of worker pensions and healthcare benefits, but Icahn Enterprises said the casino was losing millions of dollars a month.

He blamed that reality on the union’s picket lines outside the casino, and said the company could “no longer see a path to profitability.”

The DGE said on Tuesday that Icahn Enterprises had petitioned the regulator for permission to give up its license on December 22. The announcement puts to bed the suspicion, widely held within the union, that Icahn shuttered the Taj so that he could then reopen it as a non-unionized business.

According to the Associated Press, Icahn Enterprises said in the DGE filing that it had complied with all regulations on “securing unopened liquor, gambling equipment and business records; [had] made provisions to pay off unclaimed casino winnings; and [had] reduced its security staffing to ‘warehouse mode.’”

Deed Restriction on Casino Reopening

In December, the New Jersey legislature passed a bill designed to punish Icahn for closing the Taj and to prevent him from reopening it: now a moot point.

The bill, introduced by Democratic Senate President Steve Sweeney, seeks to disqualify operators from holding a casino license for a property they have closed. It has yet to be signed into law by Governor Chris Christie, who has the power to veto the measure.

Icahn Enterprises has also applied to the state Superior Court for a deed restriction prohibiting any future owner from reopening the property as a casino, unless an unspecified fee is paid.

Checkered History

The Trump Taj Mahal opened 1990 at a cost of $1 billion and was promptly declared the “eighth wonder of the world” by the current president-elect. It was bankrupt a year later, and then again in 2004, and 2009, when Trump sold the casino to a group of venture capitalists, who collectively became known as Trump Entertainment.

Icahn, the holder of the majority of the Taj’s debt, stepped in to rescue the casino from the brink when Trump Entertainment declared bankruptcy in 2014. He said he would convert the debt into equity and invest in the beleaguered property, but only if the city granted him the right to put a temporary halt on workers’ benefits, causing the union uproar to ignite.