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: