A federal judge has dismissed a lawsuit that Wells Fargo Bank filed after the Lac du Flambeau Band of Lake Superior Chippewa Indians defaulted on a $50 million bond.

Judge Rudolph T. Randa said the agreement between the tribe and its bondholders rose to the level of a gaming management agreement. But since the deal wasn't approved by the Indian Gaming Regulatory Act, it can't be enforced, according to the judge.

Having no ability to enforce a debt collection is "a nightmare for investors," Megan Neuburger of Fitch Ratings told The Milwaukee Journal-Sentinel. "It's sort of an investor's worst-case fear."

The bond was used to finance one of the tribe's casinos as well as an out-of-state gaming project that has suffered numerous setbacks. The tribe owes $46.6 million on the bond.

"They will do whatever they're legally required to do," Monica Riederer, an attorney for the tribe, told the paper. "They do feel a sense of financial responsibility."

Turtle Talk posted documents from the case.

Get the Story:
Judge refuses to name receiver for casino (The Milwaukee Journal-Sentinel 1/10)
Press Release: U.S. District Court Dismisses Case Against Lake of the Torches Economic Development Corporation (Lac du Flambeau Band 1/11)