The St. Regis Mohawks and a trust representing some major shareholders in Empire Resorts recently restarted a federal lawsuit attempting to bag USD 3 billion from the casino giant Harrah’s.

The suit, filed in the U.S. Northern District, dates back to 2001 and alleges that Park Place Entertainment (which was later bought by Harrah’s) duped the Mohawks into bolting from the Raceway to pursue a casino at Kutsher’s.

This case has been batted around for years by the Mohawks tribal court, by top officials in the Interior Department and had one go in federal court.

The plaintiffs are asking the federal court to uphold a tribal court judgment awarding USD 1.8 billion, and interest at 9 percent a year since 2001.

Catskill Litigation Trust (essentially representing shareholders of the company that became Empire Resorts) will split the judgment with the Mohawks 50/50 — a nice consolation prize, indeed, if the casino at the Monticello Gaming & Raceway never gains federal approval.

Dennis Vacco, former New York state attorney general working with the trust, reviewed the Mohawks‘ confidential files in their dealings with Park Place and found information to bolster their case that Park Place committed fraud and manipulated tribal leaders.

„We are going to vigorously seek a court judgment,“ said Lorraine White, one of the Mohawks‘ three tribal chiefs.

Harrah’s, which is being bought out by a group led by the Texas wheeler-dealer David Bonderman, has told their shareholders that the suit has been settled – but is also making some moves of its own. The casino giant is lobbying the Interior Department for a letter saying that tribal court is not a valid court.

The case has also brought changes at Empire Resorts, now partners again with the Mohawks in trying to bring Sullivan County’s first casino.

Joseph Bernstein, a major shareholder, recently resigned from the board, believing he had a conflict of interest.

He is a named plaintiff and a co-trustee in the trust.

Bernstein said yesterday that Harrah’s has emerged as the main threat to a Mohawk casino, and is making waves with Interior Secretary Dirk Kempthorne, who must still OK the casino.

Not only because the company is facing a USD 3 billion judgment, but also because it owns several casinos in Atlantic City and doesn’t want a casino built 90 minutes from Manhattan.

„In my opinion, they are holding Kempthorne’s pen,“ Bernstein said.