1 1 STATE OF NEW JERSEY 2 CASINO CONTROL COMMISSION 3 - - - - - - - - - - - - - - - - - - - 4 5 PUBLIC MEETING NO. 10-05-05 6 7 - - - - - - - - - - - - - - - - - - - 8 9 Wednesday, May 5, 2010 10 Atlantic City Commission Offices 11 Joseph P. Lordi Public Meeting Room - First Floor 12 Tennessee Avenue and Boardwalk 13 Atlantic City, New Jersey 08401 14 10:39 a.m. to 3:20 p.m. 15 16 17 Certified Court Reporter: Darlene Sillitoe 18 - - - - - - - - - - - - - - - - - - - - - - - - - - - 19 20 ATLANTIC CITY COURT REPORTING, LLC 21 CERTIFIED COURT REPORTERS AND VIDEOGRAPHERS 22 1125 ATLANTIC AVENUE, SUITE 700 23 ATLANTIC CITY, NEW JERSEY 08401 24 (609) 345-8448 www.accourtreporting.com 25 2 1 B E F O R E : 2 CASINO CONTROL COMMISSION: LINDA M. KASSEKERT, CHAIR 3 SHARON ANNE HARRINGTON, VICE CHAIR MICHAEL C. EPPS, COMMISSIONER 4 WILLIAM T. SOMMELING, COMMISSIONER EDWARD J. FANELLE, COMMISSIONER 5 6 PRESENT FOR THE CASINO CONTROL COMMISSION: DARYL W. NANCE, ADMINISTRATIVE ANALYST 7 DANIEL J. HENEGHAN, PUBLIC INFORMATION OFFICER 8 OFFICE OF THE GENERAL COUNSEL: DIANNA W. FAUNTLEROY, GENERAL COUNSEL/EXECUTIVE 9 SECRETARY TERESA M. NAGENGAST, SENIOR COUNSEL 10 SETH H. BRILLIANT, SENIOR COUNSEL LON E. MAMOLEN, SENIOR COUNSEL 11 ROBERT A. MONCRIEF, JR., COUNSEL TRACY E. RICHARDSON, COUNSEL 12 CLAIRE FRANK, PROGRAM MANAGER BERNADETTE T. FRIGEN, PROGRAM SUPERVISOR 13 DIVISION OF GAMING ENFORCEMENT: 14 JOSH LICHTBLAU, DIRECTOR DEPUTY ATTORNEYS GENERAL: 15 BRIAN C. BISCIEGLIA, DEPUTY ATTORNEY GENERAL TIMOTHY C. FICCHI, DEPUTY ATTORNEY GENERAL 16 MARY JO FLAHERTY, DEPUTY ATTORNEY GENERAL CHARLES F. KIMMEL, DEPUTY ATTORNEY GENERAL 17 LOUIS ROGACKI, DEPUTY ATTORNEY GENERAL 18 19 20 21 22 23 24 25 3 1 A P P E A R A N C E S : 2 ITEM NO. 3 DARYL NANCE, ADMINISTRATIVE ASSISTANT MARY JO FLAHERTY, DEPUTY ATTORNEY GENERAL 3 FOX ROTHSCHILD, LLP WILLIAM J. DOWNEY, III, ESQ. 4 FOR: SHOWBOAT ATLANTIC CITY OPERATING COMPANY 5 ITEM NO. 4 DARYL NANCE, ADMINISTRATIVE ASSISTANT 6 MARY JO FLAHERTY, DEPUTY ATTORNEY GENERAL FOX ROTHSCHILD, LLP 7 WILLIAM J. DOWNEY, III, ESQ. FOR: BALLY'S PARK PLACE, INC. 8 ITEM NO. 5 TRACY E. RICHARDSON, COUNSEL 9 CHARLES F. KIMMEL, DEPUTY ATTORNEY KAREN M. WOSNACK, ESQ. 10 FOR: RESORTS INTERNATIONAL HOTEL, INC. 11 ITEM NO. 8 TERESA M. NAGENGAST, SENIOR COUNSEL TIMOTHY C. FICCHI, DEPUTY ATTORNEY GENERAL 12 FOX ROTHSCHILD, LLP WILLIAM J. DOWNEY, III, ESQ. 13 FOR: ATLANTIC CITY SHOWBOAT, INC. 14 ITEM NO. 12 ROBERT A. MONCRIEF, COUNSEL TIMOTHY C. FICCHI, DEPUTY ATTORNEY GENERAL 15 FOX ROTHSCHILD, LLP WILLIAM J. DOWNEY, III, ESQ. 16 FOR: HARRAH'S ATLANTIC CITY OPERATING COMPANY, LLC 17 ITEM NO. 13 TERESA M. NAGENGAST, SENIOR COUNSEL 18 LOUIS ROGACKI, DEPUTY ATTORNEY GENERAL LEVINE, STALLER, SKLAR, CHAN, BROWN 19 & DONNELLY, PA JOHN M. DONNELLY, ESQ. 20 FOR: BAYSHORE REBAR, INC., AND PHYLLIS A. MERLINO AND JOESPH N. MERLINO 21 22 23 24 25 4 1 AGENDA PUBLIC MEETING NO. 10-05-05 2 May 5, 2010, 10:39 a.m. ITEM PAGE VOTE 3 1 Ratification of the minutes of the 9 9 April 21, 2010, public meeting 4 2 Applications for employee and casino service industry licenses 5 5 initial and/or renewal of casino key 9 10 and casino employee licenses 6 4 initial and/or renewal of casino key 11 11 and casino employee licenses 7 Application for casino service industry 10 10 license of Spring Tour, Inc., and the 8 qualification of Shing Chun Yau Application for a casino key employee 11 12 9 license and for qualification of Michelle C. Messina as Vice President of Direct 10 Marketing, Advertising for Bally's Park Place, Inc., Boardwalk Regency Corporation, Harrah's 11 Atlantic City Operating Company, LLC, and Showboat Atlantic City Operating Company 12 3 Petition of Showboat Atlantic City 12 14 Operating Company, LLC, for the issuance 13 of a temporary casino key employee license to John Zappas, Jr., pursuant to NJSA 14 5:12-89(e) and to permit him pursuant to NJAC 19:43-2.6 to assume the duties and 15 exercise the powers of Director of Security without first having been qualified (PRN 1091003) 16 4 Petition of Bally's Park Place, Inc., for 14 16 the issuance of a temporary casino key 17 employee license to Joseph Giunta pursuant to NJSA 5:12-89(e) and to permit him pursuant 18 to NJAC 19:43-2.6 to assume the duties and exercise the powers of Vice President of 19 Food & Beverage without first having been qualified (PRN 1061002) 20 5 Amended petition of Resorts International 16 18 Hotel, Inc., for the issuance of a 21 temporary casino key employee license to Jeanne Painter pursuant to NJSA 5:12-89(e) 22 and extension of time nunc pro tunc pursuant to NJAC 19:40-1.3 (PRN 1121004) 23 6 Stipulations of settlement and consent agreements: a) Joseph V. Duna (19-0053-EA) 18 20 24 b) Lucrezia K. Selby (09-0715-ER) 18 20 c) Oscar Ortiz (08-0934-RC) 18 20 25 d) Joy W. Tullar (08-0373-RC) 18 20 5 1 CONTINUED AGENDA PUBLIC MEETING NO. 10-05-05 2 May 5, 2010, 10:39 a.m. ITEM PAGE VOTE 3 e) David G. Ford, Jr. (09-0153-ER) 18 20 f) Cassandra Y. Santiago (08-0-130-ER) 18 20 4 g) Michele J. Gordy (09-0681-RC) 18 20 h) Shalice K. Henry (09-0712-ER) 18 20 5 i) Mark J. Peters (09-0655-ER) 18 20 j) Derek Pittman (09-0021-ER) 18 20 6 7 Initial decision of State v. Charles O. 20 22 Doebler (08-0445-RC) 7 8 Stipulation of settlement in State v. 22 24 Atlantic City Showboat, Inc. (08-0281-VC, 8 09-0612-VC) 9 Petition of Robin Chee for removal from 25 30 9 the exclusion list Robin Chee, Sworn 26 10 10 Petition of Thuong T. Tran for early 30 36 Reapplication (10-0093-RA) 11 Thuong T. Tran, Sworn 31 11 Petition of Tropicana Entertainment, Inc. adj. 12 and Tropicana Atlantic City Corp. for approval of Amended and Restated Audit 13 Committee Charter (PRN 0961001) 12 Petition of Harrah's Atlantic City 37 39 14 Operating Company, LLC ("Harrah's") to amend its casino license, certificate and 15 casino hotel alcoholic beverage license for a slot reconfiguration and such other relief 16 (PRN 1111001) 13 Initial decision of application of 48 135 17 Bayshore Rebar, Inc., and qualification of Phyllis A. Merlino and Joseph N. Merlino 18 (08-0318-SI) 14 Proposed readoption of NJAC 19:41 39 40 19 (Applications) 15 Petition of Diamond Gaming, LLC, and 40 42 20 Trump Taj Mahal Associates (d/b/a Trump Taj Mahal Casino Resort) for approval of 21 new wagers in "Diamond Roulette" pursuant to NJAC 19:47-8.4 (PRN 0361004); proposed 22 temporary adoption and publication of amendments to NJAC 19:47-5.2 ("Dozen" 23 Wagers in Diamond Roulette) 16 Proposed publication of amendments to 42 43 24 NJAC 19:45-1.8 and 1.26 (Destruction of Redeemed Patron Checks) 25 17 Proposed publication of amendments to 43 44 NJAC 19:45-1.10 (CCTV coverage/filming) 6 1 CONTINUED AGENDA PUBLIC MEETING NO. 10-05-05 2 May 5, 2010, 10:39 a.m. ITEM PAGE VOTE 3 18 Proposed temporary adoption of amendments 44 45 to NJAC 19:45-1.10 and 1.12 (Minimum 4 Staffing Requirements in Mini-Pits) 19 Proposed publication of amendments for 46 47 5 "EZ Baccarat" 20 Proposed adoption of amendments to NJAC 47 48 6 19:47-2.10 (Double Down Card Dealt Face Down at Designated Tables or Upon Player 7 Request) 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 7 1 E X H I B I T S : 2 NO. DESCRIPTION EVD 3 4 P-1 Remand for hearings 5 license X 5 P-2 Grant 4 licenses X 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 (Exhibits retained by Commission.) 25 8 1 (Public Meeting 10-05-05 was commenced 2 at 10:39 a.m.) 3 MR. NANCE: Good morning. I'd like to 4 read an opening statement: 5 This is to advise the general public 6 that in compliance with Chapter 231 of the 7 public laws of 1975 entitled the "Open Public 8 Meeting Act," the New Jersey Casino Control 9 Commission on October 15, 2009, filed with the 10 Secretary of State at the State House in 11 Trenton, New Jersey, a notice of this hearing. 12 On October 16, copies were mailed to 13 subscribers. 14 Members of the press will be permitted 15 to take photographs, and we ask that this be 16 done in a manner which is not disruptive or 17 distracting to the Commission. 18 The use of cell phones in the public 19 meeting room is prohibited. 20 Any member of the public who wish to 21 address the Commission will be given the 22 opportunity to do so before the Commission 23 adjourns for the day. 24 Please stand for the Pledge of 25 Allegiance. 9 ITEM NO. 1-2 1 (The flag salute was recited.) 2 CHAIR KASSEKERT: Good morning. 3 MR. NANCE: Good morning. 4 The matters discussed in closed session 5 were: Employee and enterprise license matters. 6 The Commission approved the April 21st, 7 2010, closed-session minutes. 8 Litigation update regarding: Edwards 9 versus Adamar, New Jersey, Inc., et al. 10 Item No. 1, ratification of the minutes 11 of April 21, 2010, public meeting. 12 COMMISSIONER SOMMELING: Move to 13 approve. 14 VICE CHAIR HARRINGTON: Second. 15 CHAIR KASSEKERT: Motion has been made 16 and seconded. All in favor? 17 (Ayes.) 18 CHAIR KASSEKERT: Opposed? 19 (No response.) 20 CHAIR KASSEKERT: Motion carries. 21 MR. NANCE: Item No. 2, applications for 22 employee and casino service industry licenses. 23 This agenda item will be entered as Exhibit 24 List 1 and 2. 25 Exhibit List 1 consists of five 10 ITEM NO. 2 1 applications for initial and/or renewal of 2 casino key and casino employee licenses. 3 The Division has objected to licensure. 4 COMMISSIONER EPPS: Move that we remand 5 these matters for hearing. 6 COMMISSIONER SOMMELING: Second. 7 CHAIR KASSEKERT: The motion has been 8 made and seconded. All in favor? 9 (Ayes.) 10 CHAIR KASSEKERT: Opposed? 11 (No response.) 12 CHAIR KASSEKERT: The motion carries. 13 MR. NANCE: For consideration is the 14 casino service industry license application of 15 Spring Tour, Inc. 16 The Division has objected to the casino 17 service industry license application of Spring 18 Tour, Inc., and the qualification of Shing Chun 19 Yau. 20 COMMISSIONER EPPS: Move that we remand 21 this matter for hearing. 22 COMMISSIONER SOMMELING: Second. 23 CHAIR KASSEKERT: The motion has been 24 made and seconded. All in favor? 25 (Ayes.) 11 ITEM NO. 2 1 CHAIR KASSEKERT: Opposed? 2 (No response.) 3 CHAIR KASSEKERT: Motion carries. 4 MR. NANCE: Exhibit List 2 consists of 5 four applications for initial and/or renewal of 6 casino key and casino employee licenses. 7 Staff and the Division have recommended 8 that these licenses be granted. 9 COMMISSIONER EPPS: Move that we grant 10 applications. 11 VICE CHAIR HARRINGTON: Second. 12 CHAIR KASSEKERT: The motion has been 13 made and seconded. All in favor? 14 (Ayes.) 15 CHAIR KASSEKERT: Opposed? 16 (No response.) 17 CHAIR KASSEKERT: The motion carries. 18 MR. NANCE: For consideration is the 19 application of Michelle C. Messina for casino 20 key employee license and for qualification as 21 Vice President of Direct Marketing, Advertising 22 for Bally's Park Place, Inc., Boardwalk Regency 23 Corporation, Harrah's Atlantic City Operating 24 Company, LLC, and Showboat Atlantic City 25 Operating Company, LLC. 12 ITEM NO. 3 1 Staff and the Division have recommended 2 that this application be granted. 3 COMMISSIONER EPPS: Move that we grant 4 key license and for qualification. 5 COMMISSIONER SOMMELING: Second. 6 CHAIR KASSEKERT: Motion is made and 7 seconded. This is a roll call vote. 8 MR. NANCE: Commissioner Sommeling? 9 COMMISSIONER SOMMELING: Yes. 10 MR. NANCE: Commissioner Epps? 11 COMMISSIONER EPPS: Yes. 12 MR. NANCE: Commissioner Fanelle? 13 COMMISSIONER FANELLE: Yes. 14 MR. NANCE: Vice Chair Harrington? 15 VICE CHAIR HARRINGTON: Yes. 16 MR. NANCE: Chair Kassekert? 17 CHAIR KASSEKERT: Yes. 18 MR. NANCE: The record will reflect that 19 the motion is unanimous. 20 Item No. 3, Petition No. 1091003 of 21 Atlantic City Operating Company, LLC, is 22 requesting the issuance of a temporary key 23 employee license to John Zappas, Jr., pursuant 24 to NJSA 5:12-89(e) and to permit him pursuant 25 to NJAC 19:43-2.6 to assume the duties and 13 ITEM NO. 3 1 exercise the powers of Director of Security 2 without first having been found qualified. 3 CHAIR KASSEKERT: Good morning. 4 MR. DOWNEY: Good morning. Bill Downey 5 from Fox Rothschild on behalf of Showboat 6 Atlantic City Operating Company, LLC. 7 We're prepared to stand by the petition. 8 CHAIR KASSEKERT: Okay. Very good. 9 Good morning, Miss Flaherty? 10 MS. FLAHERTY: Good morning, Chair and 11 Commissioners. 12 The Division has conducted a preliminary 13 review with regard to Mr. Zappas' 14 qualifications. And based on that, we have no 15 objection to his temporary licensure and 16 qualification. 17 Thank you. 18 CHAIR KASSEKERT: Thank you. 19 Any questions? 20 COMMISSIONER SOMMELING: No questions, 21 Madame Chair. 22 VICE CHAIR HARRINGTON: I move that we 23 approved the petition and issue a temporary 24 casino key employee license to John Zappas, 25 Jr., and permit him to assume the duties and 14 ITEM NO. 4 1 exercise the powers of Director of Security 2 without first having been found qualified. 3 COMMISSIONER EPPS: Second. 4 CHAIR KASSEKERT: Motion has been made 5 and seconded. This is a roll call vote. 6 MR. NANCE: Commissioner Sommeling? 7 COMMISSIONER SOMMELING: Yes. 8 MR. NANCE: Commissioner Epps? 9 COMMISSIONER EPPS: Yes. 10 MR. NANCE: Commissioner Fanelle? 11 COMMISSIONER FANELLE: Yes. 12 MR. NANCE: Vice Chair Harrington? 13 VICE CHAIR HARRINGTON: Yes. 14 MR. NANCE: Chair Kassekert? 15 CHAIR KASSEKERT: Yes. 16 MR. NANCE: The record will reflect that 17 the motion is unanimous. 18 Item No. 4, Petition No. 1061002 of 19 Bally's Park Place, Inc, is requesting the 20 issuance of a temporary casino key employee 21 license to Joseph Giunta pursuant to NJSA 22 5:12-89(e) and to permit him pursuant to NJAC 23 19:43-2.6 to assume the duties and exercise the 24 powers of Vice President of Food and Beverage 25 without first having been found qualified. 15 ITEM NO. 4 1 CHAIR KASSEKERT: Mr. Downey? 2 MR. DOWNEY: Chair, Bill Downey, Fox, 3 Rothschild on behalf of Bally's Park Place, 4 Inc. And, again, we'll rely on the petition. 5 CHAIR KASSEKERT: Thank you. 6 Miss Flaherty? 7 MS. FLAHERTY: Chair and the 8 Commissioners, the Division has also completed 9 a preliminary review with regard to this vice 10 president's qualification. And based on that, 11 we have no objection to his temporary license 12 and qualification. 13 Thank you. 14 CHAIR KASSEKERT: Thank you. 15 Any questions? 16 COMMISSIONER SOMMELING: No questions, 17 Madame Chair. 18 Move to approve the petition and issue a 19 temporary key employee license to Joseph Giunta 20 and permit him to assume the duties and 21 exercise the powers of Vice President of Food 22 and Beverage without first having been 23 qualified. 24 COMMISSIONER EPPS: Second. 25 CHAIR KASSEKERT: Motion is made and 16 ITEM NO. 5 1 seconded. This is a roll call vote. 2 MR. NANCE: Commissioner Sommeling? 3 COMMISSIONER SOMMELING: Yes. 4 MR. NANCE: Commissioner Epps? 5 COMMISSIONER EPPS: Yes. 6 MR. NANCE: Commissioner Fanelle? 7 COMMISSIONER FANELLE: Yes. 8 MR. NANCE: Vice Chair Harrington? 9 VICE CHAIR HARRINGTON: Yes. 10 MR. NANCE: Chair Kassekert? 11 CHAIR KASSEKERT: Yes. 12 MR. NANCE: The record will reflect that 13 the motion is unanimous. 14 CHAIR KASSEKERT: Thank you. 15 MR. DOWNEY: Thank you. 16 MR. NANCE: Item No. 5, amended petition 17 of Resorts Hotel International, Inc., for 18 Jeanne Painter pursuant to NJSA 5:12-89(e) and 19 extension of time nunc pro tunc pursuant to 20 NJAC 19:40-1.3. 21 Miss Richardson? 22 MS. RICHARDSON: Good morning, Chair and 23 Commissioners. 24 A draft resolution on this item was 25 circulated to the parties. And appearing for 17 ITEM NO. 5 1 the Petitioner is Karen Wosnack and for the 2 Division is DAG Chuck Kimmel. 3 CHAIR KASSEKERT: Good morning, Miss 4 Woznack. 5 MS. WOZNACK: Good morning. 6 I have nothing to add other than ask 7 that you approve the requested relief. 8 Thank you. 9 CHAIR KASSEKERT: Thank you. 10 Mr. Kimmel, good morning. 11 MR. KIMMEL: Good morning. I have read 12 the draft resolution. We have no objection to 13 the relief requested or to the adoption of the 14 draft resolution. 15 Thank you. 16 CHAIR KASSEKERT: Thank you. 17 Any questions? 18 COMMISSIONER SOMMELING: No questions, 19 Madame Chair. 20 COMMISSIONER EPPS: Madame Chair, I move 21 that approve the peition and issue a temporary 22 casino key employee license to Jeanne Painter 23 and for good cause shown pursuant to NJAC 24 19:40-1.3(d) grant the requested relief of 25 Resorts International Hotel, Inc., nunc pro 18 ITEM NO. 6 1 tunc to April 17th, 2010, to allow it to 2 appoint a replacement equal opportunity officer 3 on a permanent basis by May 5th, 2010. 4 VICE CHAIR HARRINGTON: Second. 5 CHAIR KASSEKERT: Motion is made and 6 seconded. This is a roll call vote. 7 MR. NANCE: Commissioner Sommeling? 8 COMMISSIONER SOMMELING: Yes. 9 MR. NANCE: Commissioner Epps? 10 COMMISSIONER EPPS: Yes. 11 MR. NANCE: Commissioner Fanelle? 12 COMMISSIONER FANELLE: Yes. 13 MR. NANCE: Vice Chair Harrington? 14 VICE CHAIR HARRINGTON: Yes. 15 MR. NANCE: Chair Kassekert? 16 CHAIR KASSEKERT: Yes. 17 MR. NANCE: The record will reflect that 18 the motion is unanimous. 19 CHAIR KASSEKERT: Thank you. 20 MS. WOZNACK: Thank you very much. 21 MR. KIMMEL: Thank you. 22 MR. NANCE: Item No. 6, stipulation of 23 settlement and contents agreements. When I 24 call your name, please come forward, standing 25 behind this middle table, spreading across the 19 ITEM NO. 6 1 room so that you may be seen: Joseph Duna, 2 Lucrezia Selby, Oscar Ortiz, Joy Tullar, David 3 Ford, Jr., Cassandra Santiago, Michele Gordy, 4 Shalice Henry, Mark Peters, and Derek Pittman. 5 CHAIR KASSEKERT: Has everyone whose 6 name been called come forward? 7 Okay. Ma'am, I'm going to ask that you 8 state your name for the record. 9 MS. GORDY: Michele Gordy. 10 CHAIR KASSEKERT: Okay. Miss Gordy, in 11 a moment we're going to vote on the 12 stipulations which you've agreed to with the 13 Division of Gaming Enforcement. I'm going to 14 ask if you wish to be heard on your matter. 15 You don't have to say anything if you don't 16 want to. 17 (No verbal response.) 18 CHAIR KASSEKERT: Okay. I'm going to 19 take that as a no. 20 Mr. Biscieglia? 21 MR. BISCIEGLIA: Good morning, Chair, 22 Commissioners. 23 The Division has nothing further and ask 24 that stipulations be adopted as submitted. 25 Thank you. 20 ITEM NO. 7 1 CHAIR KASSEKERT: Thank you. 2 Any questions? 3 COMMISSIONER SOMMELING: No questions, 4 Madame Chair. 5 Move to approve the stipulation as 6 stated. 7 COMMISSIONER EPPS: Second. 8 CHAIR KASSEKERT: The motion has been 9 made and seconded. All in favor? 10 (Ayes.) 11 CHAIR KASSEKERT: Opposed? 12 (No response.) 13 CHAIR KASSEKERT: Motion carries. 14 Thank you for coming. Good luck. 15 MS. GORDY: Thank you. 16 MR. BISCIEGLIA: Thank you. 17 MR. NANCE: Item No. 7, initial decision 18 of State versus Charles O. Doebler. 19 Mr. Moncrief? 20 MR. MONCRIEF: Good morning, Madame 21 Chair, and members of the Commission. 22 Before you is the initial decision of 23 Commissioner Sommeling finding that the 24 Respondent's conduct in this case was not 25 inimical to the Casino Control Act nor to the 21 ITEM NO. 7 1 policies of -- for the casino operations. 2 Commissioner Sommeling further found 3 that the Respondent is qualified and his casino 4 employee license should be reinstated. 5 Here for the Division is DAG Charles 6 Kimmel. 7 CHAIR KASSEKERT: Thank you. 8 Mr. Kimmel? 9 MR. KIMMEL: Thank you, Chair. 10 The Division chose not to file 11 exceptions in this case. We don't take issue 12 with the factual findings set forth by 13 Commission Sommeling. The only question here 14 was one of time. Since the date of the 15 offense, we think maybe it's been a bit too 16 soon. But, as I said, we chose not to file 17 exceptions in this case, so we leave it to you. 18 Thank you. 19 CHAIR KASSEKERT: Thank you. 20 Any questions for Mr. Kimmel? 21 VICE CHAIR HARRINGTON: No questions. 22 I'll move that we adopt the initial 23 decision and: A, find Charles O. Doebler 24 qualified; B, vacate the Commission order dated 25 July 16th, 2008, in its entirety; and, C, 22 ITEM NO. 8 1 reinstate his casino employee license. 2 COMMISSIONER EPPS: Second. 3 CHAIR KASSEKERT: The motion has been 4 made and seconded. All in favor? 5 (Ayes.) 6 CHAIR KASSEKERT: Opposed? 7 (No response.) 8 CHAIR KASSEKERT: Motion carries. 9 Thank you. 10 MR. MONCRIEF: Thank you. 11 MR. NANCE: Item No. 8, stipulation of 12 settlement in State versus Atlantic City 13 Showboat, Inc. 14 MS. NAGENGAST: Good morning, Chair and 15 Commissioners. For your consideration is the 16 stipulation of settlement which, if adopted, 17 will dismiss one complaint in its entirety, 18 dismiss a second count of a second complaint, 19 and assess a $25,000 penalty against Showboat. 20 Counsel is here, and I would just ask if 21 they enter their appearances. 22 CHAIR KASSEKERT: Thank you. 23 Mr. Downey? 24 MR. DOWNEY: Bill Downey from Fox 25 Rothschild on behalf of Showboat Atlantic City 23 ITEM NO. 8 1 Operating Company, LLC. 2 MR. FICCHI: Yes. Timothy Ficchi for 3 the Division. 4 The Division doesn't have anything 5 further. We just request the adoption of the 6 settlement. 7 CHAIR KASSEKERT: Thank you. 8 Mr. Downey, anything to add to this 9 settlement? 10 MR. DOWNEY: No, Madame Chair. Subject 11 to any questions you might have. 12 CHAIR KASSEKERT: Okay. Let me ask if 13 there are any questions? 14 COMMISSIONER SOMMELING: No questions, 15 Madame Chair. 16 CHAIR KASSEKERT: Commissioner Epps? 17 COMMISSIONER EPPS: I just want to be 18 clear because this is somewhat awkward if you 19 look at them together. You are -- Showboat is 20 agreeing to pay a stipulated fine in -- to 21 resolve these two matters. And that's -- 22 you're entering into that freely and willingly, 23 and that's what you want to do. 24 MR. DOWNEY: We'd like to settle the two 25 matters that are before you. And yeah. That's 24 ITEM NO. 8 1 correct. We've enter into this stipulation 2 with that intent. 3 COMMISSIONER EPPS: Okay. 4 CHAIR KASSEKERT: Any other questions? 5 COMMISSIONER SOMMELING: No questions, 6 Madame Chair. 7 VICE CHAIR HARRINGTON: I'll move that 8 we approve the stipulation of settlement and, 9 one, dismiss with prejudice Count 2 of the 10 complaint in Agency Docket No. 08-0281-VC and 11 the entire complaint in Agency Docket No. 12 09-0612-VC; and, two, impose a civil penalty of 13 $25,000 against Atlantic City Showboat, Inc., 14 for violation of Commission regulations 15 regarding casino hotel alcoholic beverage 16 control. 17 COMMISSIONER SOMMELING: Second. 18 CHAIR KASSEKERT: The motion has been 19 made and seconded. All in favor? 20 (Ayes.) 21 CHAIR KASSEKERT: Opposed? 22 (No response.) 23 CHAIR KASSEKERT: Motion carries. 24 Thank you. 25 MR. FICCHI: Thank you. 25 ITEM NO. 9 1 MR. DOWNEY: Thank you. 2 MS. FAUNTLEROY: Excuse me, 3 Commissioner. Just to clarify for the record 4 going forward that the parties understand that 5 the initial decision has no force and effect 6 and is null for all intents of purposes and 7 will not be presented to the Office of 8 Administrative Law for any purposes. 9 Is that the understanding of the 10 parties? 11 MR. FICCHI: Yeah. 12 MR. DOWNEY: Sure. 13 CHAIR KASSEKERT: Okay. Thank you, 14 Counsel. 15 MR. NANCE: Item No. 9, petition of 16 Robin Chee for removal from the exclusion list. 17 Miss Frigen? 18 MS. FRIGEN: Good morning, Madame Chair, 19 Commissioners. 20 For your consideration is Mr. Chee's 21 petition seeking removal from the exclusion 22 list. 23 Chuck Kimmel is here on behalf of the 24 Division of Gaming Enforcement. 25 I would ask Mr. Chee to go forward first 26 ITEM NO. 9 1 and present to you the reasons why he's seeking 2 removal from the exclusion list and then 3 request the Division to provide its position. 4 CHAIR KASSEKERT: Thank you. 5 Mr. Chee, would you stand up and be 6 sworn in. 7 8 ROBIN CHEE, was duly sworn to testify in 9 this matter. 10 11 MR. NANCE: Please state your name for 12 the record. 13 MR. CHEE: Robin Chee. 14 MR. NANCE: Thank you. 15 CHAIR KASSEKERT: Mr. Chee, tell us why 16 we should remove your name from our exclusion 17 list? 18 MR. CHEE: I've been back in society 19 since 2003. I was incarcerated for nine year. 20 And I know in the past, and I was plead guilty 21 to it. And in federal prison. And I've been 22 out seven year already, and my probation off. 23 I was on probation for five year. 24 And I was just wondering, you know, like 25 I did everything that they ask for. I'm 27 ITEM NO. 9 1 working ever since I've been released from 2 my -- from federal prison. And, in addition, I 3 have two additional kid, my family. I have 4 five-year-old kid and three-year-old kid ever 5 since I've came out. And I've been model 6 citizen ever since I came out. 7 MR. NANCE: Would you speak up a little 8 bit louder, please? 9 MR. CHEE: Okay. 10 CHAIR KASSEKERT: Yeah. Our transcriber 11 is trying to take down what you say. 12 MR. CHEE: Sorry. 13 And I'm just wondering if okay if the 14 Commission take my name off the exclusion list 15 because I'd like to bring my family down here. 16 I love the Atlantic City casino, drive down 17 here. 18 CHAIR KASSEKERT: Let me ask if any of 19 the commissioners have any questions before we 20 hear from the Division? 21 COMMISSIONER SOMMELING: I have no 22 questions, Madame Chair. 23 COMMISSIONER FANELLE: No. 24 CHAIR KASSEKERT: Okay. So let me just 25 ask. In addition to the -- you know, you told 28 ITEM NO. 9 1 me you have two children now. You'd like to -- 2 MR. CHEE: Yeah. I have three total. 3 CHAIR KASSEKERT: Three total. 4 MR. CHEE: I have -- yeah. Right. 5 CHAIR KASSEKERT: Uh-huh. And -- 6 MR. CHEE: I have an 18-year-old and 7 five-year-old and three-year-old. 8 CHAIR KASSEKERT: Okay. Maybe if you 9 could just tell us why -- you know, what have 10 you done to change your life that warrants us 11 removing you from the exclusion list? 12 MR. CHEE: I'm completely -- I have no 13 contact with my associate from the past. And I 14 working for this company called Scott Michael 15 in Queens, a storage company, ever since I've 16 been out. And I work five days a week, and the 17 week -- weekend I stay my family. And -- 18 CHAIR KASSEKERT: And you've had no 19 run-ins with the law? 20 MR. CHEE: Nobody. With the law, or 21 anything. 22 CHAIR KASSEKERT: Okay. Mr. Kimmel? 23 Oh, I'm sorry. Commissioner Epps? 24 COMMISSIONER EPPS: Well, I just wanted 25 to say that you understand the matter here 29 ITEM NO. 9 1 today is just for us to give you an opportunity 2 to have a hearing. 3 MR. CHEE: Correct. 4 COMMISSIONER EPPS: This is not a 5 decision on that, on those merits right now. 6 MR. CHEE: I understand. 7 COMMISSIONER EPPS: Today is just for us 8 to decide whether or not you get to have a 9 hearing to determine whether you will -- you 10 appreciate that? Okay. 11 MR. CHEE: Okay. 12 COMMISSIONER EPPS: Okay. 13 CHAIR KASSEKERT: Okay. Mr. Kimmel? 14 MR. KIMMEL: Which is exactly what I 15 wanted to point out. Posturally, this is just 16 getting us to the point where we are going to 17 have a full evidentiary hearing. The Division 18 will leave that matter to the Commission's 19 discretion that we have a hearing. If, in 20 fact, you decide to have that, then we'll 21 present a full case at that time. 22 CHAIR KASSEKERT: Thank you, Mr. Kimmel. 23 Any questions? 24 COMMISSIONER SOMMELING: Madame Chair, I 25 move to grant Mr. Chee's petition and remand 30 ITEM NO. 10 1 the case to a hearing for determination of 2 whether his name should be removed from the 3 Commission's exclusion list. 4 VICE CHAIR HARRINGTON: Second. 5 CHAIR KASSEKERT: The motion has been 6 made and seconded. All in favor? 7 (Ayes.) 8 CHAIR KASSEKERT: Opposed? 9 (No response.) 10 CHAIR KASSEKERT: Motion carries. 11 Thank you for coming. 12 MR. CHEE: Thank you. 13 MR. NANCE: Item No. 10, petition of 14 Thuong T. Tran for early reapplication. 15 Miss Frigen? 16 MS. FRIGEN: Miss Tran is present. 17 Where is she? Oh, here she is. 18 For your consideration is Miss Tran's 19 petition seeking permission to reapply early 20 for a license, registration, and/or 21 non-credential hotel employment. The Division 22 has interposed no objection to Ms. Tran 23 applying for a casino employee license but not 24 to work on the hotel side. 25 I would ask Miss Tran to address you if 31 ITEM NO. 10 1 she wants to further in connection with her 2 petition. 3 CHAIR KASSEKERT: Sure. 4 Miss Tran, would you please rise and 5 we'll swear you in. 6 MR. NANCE: Would you stand, please? 7 Miss Tran, over here. 8 9 THUONG T. TRAN, was duly sworn to 10 testify in this matter. 11 12 MR. NANCE: Please state your name for 13 the record. 14 MS. TRAN: My name Tran. 15 MR. NANCE: Do you understand what I 16 just said? 17 MS. TRAN: Yes. 18 MR. NANCE: Okay. 19 MS. TRAN: I understand a little bit but 20 not. I understand. 21 MR. NANCE: You may be seated. 22 MS. TRAN: Okay. Thank you. 23 CHAIR KASSEKERT: Okay. What would you 24 like to tell us today? 25 MS. TRAN: Can you talk slow, please? I 32 ITEM NO. 10 1 speak English a little bit. 2 CHAIR KASSEKERT: Sure. What would you 3 like to tell us today? What do you want to 4 tell us? 5 MS. TRAN: I like to come back work in 6 the casino. That's where -- I come here 7 because I got children. I don't have a job. 8 That's why I also they give me back driver 9 license, and I go back. I come back working in 10 casino because of ID already. I get out of the 11 Tropicana five year. I cannot work. That's 12 why I hope so today to give me back, and I go 13 back work. 14 That's why I come here. I got five 15 kids. 16 CHAIR KASSEKERT: Okay. Let me ask if 17 any of the commissioners have any questions? 18 COMMISSIONER EPPS: I do. 19 CHAIR KASSEKERT: Commissioner Epps? 20 COMMISSIONER EPPS: What did you do at 21 Tropicana when you worked? 22 MS. TRAN: Okay. I can explain. That's 23 what happened because -- 24 COMMISSIONER EPPS: No. Not what 25 happened. What type of work did you do? 33 ITEM NO. 10 1 MS. TRAN: A dealer. 2 COMMISSIONER EPPS: You were a dealer? 3 MS. TRAN: Yes. 4 COMMISSIONER EPPS: Okay. Now, do you 5 understand that the suggestion is that you 6 don't go back to a license but you go back to 7 some job maybe in the hotel. That's the 8 recommendation right now is not all the way to 9 license but maybe a hotel job. Do you 10 understand that? 11 MS. TRAN: I understand. 12 COMMISSIONER EPPS: You understand. 13 MS. TRAN: Only for the hotel. 14 COMMISSIONER EPPS: Okay. 15 MS. TRAN: Not inside the casino. 16 COMMISSIONER EPPS: Right. So you 17 understand that you would try to find something 18 in the hotel to just start working if this was 19 granted? 20 MS. TRAN: That for the hotel for the 21 casino or the hotel? Outside. 22 COMMISSIONER EPPS: Right. Hotel and 23 outside but not dealing and not change person, 24 not money things. Something on maybe the hotel 25 side where you can just start working and get a 34 ITEM NO. 10 1 job to get some money, but maybe not dealing 2 where you need a license. Do you follow me? 3 MS. TRAN: Yeah. I understand. 4 VICE CHAIR HARRINGTON: But a casino 5 hotel. 6 CHAIR KASSEKERT: But a casino hotel. 7 Right. 8 MS. TRAN: The hotel casino. 9 COMMISSIONER EPPS: The casino hotel but 10 not -- 11 MS. TRAN: Not dealer. 12 COMMISSIONER EPPS: On the floor. 13 Right. 14 MS. TRAN: And can I ask you? How long 15 can this take? How long can this take? 16 COMMISSIONER EPPS: If that's what 17 happens, Bernadette will be able to explain 18 what happens after that. Do you understand? 19 MS. TRAN: Okay. 20 COMMISSIONER EPPS: Right here. She'll 21 be able to tell you a little bit further. 22 MS. FRIGEN: Okay. Let's see what 23 happens, and then I'll talk to you after -- 24 MS. TRAN: Okay. 25 MS. FRIGEN: -- we decide. After we go 35 ITEM NO. 10 1 from the Division of Gaming Enforcement. 2 MR. TRAN: Okay. Thank you. 3 CHAIR KASSEKERT: Mr. Biscieglia? 4 MR. BISCIEGLIA: Thank you. 5 The Division has set forth our position 6 in our letter of March 29th, 2010. The 7 Division does object to a petition -- excuse 8 me -- to the Petitioner's request to reapply 9 for a casino employee license based on the 10 factual matters set forth which resulted in the 11 conviction of September 23rd of 2005. 12 The Division will -- does not object to 13 a finding allowing her to obtain a casino 14 service employee registration or a casino 15 employee license. 16 Thank you. 17 CHAIR KASSEKERT: Thank you. 18 Any questions? 19 MR. BISCIEGLIA: Or -- excuse me, a 20 non-credential employment. 21 (Laughter.) 22 MR. BISCIEGLIA: Let me rephrase that. 23 The Division will not object to a 24 finding by the Commission allowing the 25 Respondent to obtain a casino service employee 36 ITEM NO. 10 1 registration -- 2 CHAIR KASSEKERT: Registration. Right. 3 MR. BISCIEGLIA: -- or non-credential 4 employment. 5 Thank you. 6 CHAIR KASSEKERT: Any questions? 7 COMMISSIONER SOMMELING: No questions, 8 Madame Chair. 9 COMMISSIONER EPPS: Madame Chair, having 10 heard the Division's position and that Ms. Tran 11 seems to understand, I'm going to move that we 12 deny Miss Tran's permission to reapply early 13 for casino employee license, however, grant her 14 permission to reapply early for a casino 15 service employee registration and/or to obtain 16 employment early as a non-credential hotel 17 employee. 18 COMMISSIONER SOMMELING: Second. 19 MS. TRAN: Thank you. 20 CHAIR KASSEKERT: The motion has been 21 made and seconded. All in favor? 22 (Ayes.) 23 CHAIR KASSEKERT: Opposed? 24 (No response.) 25 CHAIR KASSEKERT: Motion carries. 37 ITEM NO. 11-12 1 Thank you. Yeah. Bernadette will 2 explain to you. Thank you for coming. Good 3 luck. 4 MR. BISCIEGLIA: Thank you. 5 MR. NANCE: Item No. 11 has been 6 adjourned without date. 7 For your consideration, Item No. 12, 8 petition of Harrah's Atlantic City Operating 9 Company, LLC, to an amendment its casino 10 license certificate and casino hotel alcoholic 11 beverage license for a slot reconfiguration and 12 such other relief. 13 Mr. Moncrief? 14 MR. MONCRIEF: Madame Chair and members 15 of the Commission, before you is a petition of 16 Harrah's seeking approval to amend its casino 17 license, casino operations certificate, and 18 CHAB license. 19 I leave the matter for your 20 consideration. 21 CHAIR KASSEKERT: Thank you. 22 Mr. Downey? 23 MR. DOWNEY: Madame Chair, Bill Downey 24 from Fox Rothschild on behalf of Harrah's 25 Atlantic City Operating Company. 38 ITEM NO. 12 1 By this petition, Harrah's seek to 2 reconfigure its floor to drop 200 machines, add 3 approximately 4300 square feet of casino space 4 with no change to its simulcast race. 5 Otherwise, we'll rely on our blueprints 6 and certifications attached to the petition. 7 CHAIR KASSEKERT: Thank you. 8 Mr. Ficchi? 9 MR. FICCHI: Thank you, Madame Chair and 10 Commissioners. 11 The Division has reviewed the draft 12 resolution and has no objection to its adoption 13 by the Commission. 14 Thank you. 15 CHAIR KASSEKERT: Thank you. 16 Any questions? 17 COMMISSIONER FANELLE: No questions, 18 Madame Chair. 19 Madame Chair, I move to adopt the draft 20 resolution and approve the amended petition of 21 Harrah's Operating Company, LLC, for an 22 amendment to its certificate of operations to 23 permit the reconfiguration of its gaming floor 24 subject to the conditions in the resolution. 25 COMMISSIONER EPPS: Second. 39 ITEM NO. 14 1 VICE CHAIR HARRINGTON: Second. 2 CHAIR KASSEKERT: The motion has been 3 made and seconded. All in favor? 4 (Ayes.) 5 CHAIR KASSEKERT: Opposed? 6 (No response.) 7 CHAIR KASSEKERT: Motion carries. 8 Thank you. 9 MR. FICCHI: Thank you. 10 MR. DOWNEY: Thank you. 11 MR. NANCE: For your consideration Item 12 No. 14, proposed readoption of NJAC 19:41. 13 Miss Frank? 14 MS. FRANK: Good morning, Chair and 15 Commissioners. 16 NJAC 19:41 application was scheduled to 17 expire on April 15th of this year during a 18 rulemaking freeze implemented by Executive 19 Order No. 1 effective January 20th, 2010. 20 However, by virtue of Paragraph 6 of that 21 executive order, all rules that would otherwise 22 expire during the freeze were extended until 23 such time as the freeze was lifted and the 24 rules could be readopted pursuant to the 25 procedures in the Administrative Procedure Act. 40 ITEM NO. 15 1 The 90-day rulemaking freeze was ended 2 April 19th of this year, and the proposed 3 readoption of 19:41 is now being presented to 4 you for consideration. 5 If approved, the notice of proposed 6 readoption will be published in the June 7th, 7 New Jersey "Register." 8 CHAIR KASSEKERT: Thank you. 9 Any questions for Miss Frank? 10 COMMISSIONER SOMMELING: No questions. 11 VICE CHAIR HARRINGTON: I'll move that 12 we approve the proposed readoption for 13 publication. 14 COMMISSIONER FANELLE: Second. 15 COMMISSIONER EPPS: Second. 16 CHAIR KASSEKERT: The motion has been 17 made and seconded. All in favor? 18 (Ayes.) 19 CHAIR KASSEKERT: Opposed? 20 (No response.) 21 CHAIR KASSEKERT: Motion carries. 22 MS. FRANK: Thank you. 23 CHAIR KASSEKERT: Thank you. 24 MR. NANCE: Item No. 15, petition of 25 Diamond Gaming, LLC, and Trump Taj Mahal 41 ITEM NO. 15 1 Associates for approval of new wagers in 2 "Diamond Roulette" pursuant to NJAC 19:47-8.4 3 and proposed temporary adoption of publication 4 of amendments to NJAC 19:47-5.2. 5 Mr. Briliant? 6 MR. BRILIANT: Good morning, Madame 7 Chair and Commissioners. 8 The petition before you is the result of 9 a rulemaking petition to add the "Dozen Wagers" 10 bet to the game of Diamond Roulette, which is 11 itself a variation of the game of roulette. 12 The petition was filed February the 5th. 13 The Commission could not act on it at that time 14 because of Governor Christie's executive order 15 which prohibited rulemaking. That order 16 expired April the 19th, and the matter is now 17 before you for your consideration. 18 CHAIR KASSEKERT: Thank you. 19 Any question for Mr. Briliant? 20 COMMISSIONER SOMMELING: No questions, 21 Madame Chair. 22 VICE CHAIR HARRINGTON: I'll move that 23 we approve for publication and temporary 24 adoption this proposal. 25 CHAIR KASSEKERT: Is there a second? 42 ITEM NO. 16 1 COMMISSIONER FANELLE: Second. 2 COMMISSIONER SOMMELING: Second. 3 CHAIR KASSEKERT: The motion has been 4 made and seconded. All in favor? 5 (Ayes.) 6 CHAIR KASSEKERT: Opposed? 7 (No response.) 8 CHAIR KASSEKERT: Motion carries. 9 MR. NANCE: Item No. 16, proposed 10 publication of amendment to NJAC 19:45-1.8 and 11 1.26. 12 Mr. Briliant? 13 MR. BRILIANT: Okay. This proposal was 14 requested by the Borgata Hotel Casino and it 15 would permit a casino licensee to destroy 16 redeemed patron checks any time after six 17 months of redemption provided that certain 18 conditions are met. 19 And the matter is now before you for 20 consideration. 21 CHAIR KASSEKERT: Thank you. 22 Any questions? 23 COMMISSIONER SOMMELING: I have no 24 questions, Madame Chair. 25 COMMISSIONER FANELLE: Madame Chair, I 43 ITEM NO. 17 1 move that we approve for publication this 2 proposal. 3 VICE CHAIR HARRINGTON: Second. 4 CHAIR KASSEKERT: The motion has been 5 made and seconded. All in favor? 6 (Ayes.) 7 CHAIR KASSEKERT: Opposed? 8 (No response.) 9 CHAIR KASSEKERT: Motion carries. 10 MR. NANCE: Item No. 17, proposed 11 publication of amendments to NJAC 19:45-1.10. 12 Mr. Briliant? 13 MR. BRILIANT: Okay. This regulation 14 was requested by the Division of Gaming 15 Enforcement, and it would require CCTV coverage 16 of any transaction, not just replenishment of 17 servicing of machines such as bill breakers, 18 voucher redemption machines, jackpot pay-out 19 machines. 20 The Division suggests that this might 21 assist in investigation and prosecution of 22 thefts or tampering of such equipment. 23 CHAIR KASSEKERT: Thank you. 24 Any questions? 25 COMMISSIONER SOMMELING: No questions, 44 ITEM NO. 18 1 Madame Chair. 2 COMMISSIONER EPPS: Move that we approve 3 for publication. 4 COMMISSIONER SOMMELING: Second. 5 CHAIR KASSEKERT: The motion has been 6 made and seconded. All in favor? 7 (Ayes.) 8 CHAIR KASSEKERT: Opposed? 9 (No response.) 10 CHAIR KASSEKERT: Motion carries. 11 MR. NANCE: Item No. 18, proposed 12 temporary adoption of amendments to NJAC 13 19:45-1.10 and 1.12. 14 Mr. Briliant? 15 MR. BRILIANT: Okay. This proposal was 16 requested by Bally's Park Place several months 17 ago. We could not move on it because of the 18 regulatory freeze which has now been lifted. 19 The proposal would permit one pit boss 20 to supervise up to four gaming tables in one 21 pit without a floor person being present under 22 certain conditions. These were would include 23 things like no-pitch games, dealing from the 24 hand, minimal wager of no more than $25, and 25 the exclusion of certain authorized games such 45 ITEM NO. 18 1 as craps and baccarat or any game that offers a 2 progressive wager. It would also require 3 continuous CCTV coverage of those types of mini 4 pits. 5 The matter is now before you for your 6 consideration. 7 CHAIR KASSEKERT: Thank you. 8 Any questions? 9 COMMISSIONER SOMMELING: No questions, 10 Madame Chair. 11 VICE CHAIR HARRINGTON: I will move that 12 we approve this for temporary adoption. 13 COMMISSIONER FANELLE: Second. 14 CHAIR KASSEKERT: The motion has been 15 made and seconded. All in favor? 16 (Ayes.) 17 CHAIR KASSEKERT: Opposed? 18 (No response.) 19 CHAIR KASSEKERT: The motion carries. 20 MR. BRILIANT: Thank you. 21 VICE CHAIR HARRINGTON: And I have to 22 thank you, Mr. Briliant, for the diagram that 23 helped me to understand what we were talking 24 about with this issue. 25 MR. BRILIANT: As I mentioned to Dan 46 ITEM NO. 19 1 Heneghan, it wasn't drawn to scale, but it got 2 the idea across. 3 CHAIR KASSEKERT: Thank you. 4 (Laughter.) 5 MR. BRILIANT: Thank you. 6 MR. NANCE: Item No. 19, proposed 7 publication for amendment for "EZ Baccarat." 8 Mr. Mamolen? 9 MR. MAMOLEN: Good morning, Chair, 10 Commissioners. 11 Before you is a publication of regs that 12 are at this point ripe for a new variation of 13 baccarat. Instead of the house charging a 14 vigorish in the game, what is proposed, of 15 course, is that there -- no vigorish, but there 16 be a -- what would otherwise be deemed a 17 winning wager for a three-card seven-point 18 total, which is now deemed a push. 19 There have been no problems at the 20 Marina where it's been tested over the last 21 several months, and it's before you for 22 publication. 23 CHAIR KASSEKERT: Thank you. 24 Any question for Mr. Mamolen? 25 COMMISSIONER SOMMELING: I have no 47 ITEM NO. 20 1 questions. 2 COMMISSIONER EPPS: Move to approve for 3 publication. 4 COMMISSIONER FANELLE: Second. 5 CHAIR KASSEKERT: The motion has been 6 made and seconded. All in favor? 7 (Ayes.) 8 CHAIR KASSEKERT: Opposed? 9 (No response.) 10 CHAIR KASSEKERT: Motion carries. 11 MR. NANCE: Item No. 20, proposed 12 adoption of amendments to NJAC 19:47-2.10. 13 Mr. Mamolen? 14 MR. MAMOLEN: This matter is before you 15 for final adoption, and it involves the 16 double-down card being dealt facedown at a 17 player's request or on house designation of 18 specific tables for that option. 19 There were no comments during the 20 comment period upon publication. Again, it's 21 before you for final adoption. 22 CHAIR KASSEKERT: Thank you. 23 Any questions? 24 COMMISSIONER SOMMELING: No questions, 25 Madame Chair. 48 ITEM NO. 13 1 VICE CHAIR HARRINGTON: I will move that 2 we adopt as published. 3 COMMISSIONER FANELLE: Second. 4 CHAIR KASSEKERT: The motion has been 5 made and seconded. All in favor? 6 (Ayes.) 7 CHAIR KASSEKERT: Opposed? 8 (No response.) 9 CHAIR KASSEKERT: Motion carries. 10 MR. BRILIANT: Thank you. 11 CHAIR KASSEKERT: Thank you. 12 Let me ask, Commissioners, do you want 13 to break before we consider Item 13 or -- 14 VICE CHAIR HARRINGTON: No. 15 CHAIR KASSEKERT: Okay. 16 You can call Item 13. 17 MR. NANCE: Item No. 13, initial 18 decision application of Bayshore Rebar, Inc., 19 and qualification of Phyllis A. Merlino and 20 Joseph N. Merlino. 21 Miss Nagengast? 22 MS. NAGENGAST: Good morning, Chair and 23 Commissioners. 24 COMMISSIONER FANELLE: Good morning. 25 MS. NAGENGAST: For your consideration 49 ITEM NO. 13 1 is the initial decision of the application of 2 Bayshore Rebar, Inc., and the qualification of 3 Phyllis Merlino and Joseph Merlino. 4 All right. The Division did file 5 exceptions. Mr. Donnelly is here on behalf of 6 Applicant's and Lou Rogacki is here on behalf 7 the Division. 8 CHAIR KASSEKERT: Good morning, Mr. 9 Rogacki. 10 MR. ROGACKI: Good morning, Chair. 11 MR. DONNELLY: Good morning. 12 CHAIR KASSEKERT: Mr. Rogacki, I think 13 you would proceed first. 14 MR. ROGACKI: Yes, Chair. 15 Chair, Commissioners, good morning. My 16 comments this morning are in addition to our 17 written submissions. The Division asked the 18 full Commission to reject the initial decision 19 of Commissioner Sommeling who was the hearing 20 examiner in this matter because we believe 21 accepting it will change the baseline standard 22 by which all future organized crime cases are 23 adjudicated before this Commission. 24 If this initial decision is accepted, 25 the new standard, apparently, will be that 50 ITEM NO. 13 1 without regard to prior history before this 2 Commission, meeting with, associating with, 3 hanging around with, having contact with -- 4 with whatever moniker you want to put on it -- 5 with members of organized crime for 6 indeterminate periods of time will be 7 acceptable to this Commission as long as the 8 applicant swears off the associations prior to 9 filing its application with this Commission 10 prior -- for licensure or some time thereabout. 11 The Division believes that allowing 12 organized crime associations to be turned on 13 and off at the whim of applicants in this 14 manner is a dangerous precedent. 15 Interestingly enough, this initial 16 decision allows these applicants to cloak their 17 organized crime contacts under the shroud of 18 family. However, while their continued contact 19 with Joseph "Skinny Joey" Merlino in 20 contravention of former Chair Brad Smith's 21 March 5th, 1997, prohibitory order, obviously 22 was with a family member. Their contacts with 23 the following individuals: Martin "Marty 24 Angelina, Joseph Bongiovani, Damion Canalichio, 25 Albert Lancellotti, Anthony Accardo, Ralph 51 ITEM NO. 13 1 Abbruzzi, Daniel Didone, Michael Lancellotti, 2 Michael "Twitch" Virgilio, Francis Porter, 3 Ralph Pungitore, Angelo Lutz, Anthony Giraldi, 4 Steven Mazzone, and Joseph Ligambi, starting 5 less than three months after the prior 6 prohibitory order by this Commission were in no 7 way a member with -- a member of their family. 8 In fact, these contacts occurred no less than 9 nine times between June of 1997 and July of 10 1998 and occurred not only in public places but 11 at the Applicant's residence which was also the 12 location of the Applicant's business address. 13 In fact, the Division submits these were 14 exactly the types of contacts and associations 15 that this Commission was concerned with while 16 prohibiting these Applicants the first two 17 times, in 1988 and in 1997. 18 At the very least -- excuse me. 19 In furtherance of its case, the Division 20 presented evidence that inimical associations 21 continued beyond 1998 and after the decision, 22 as the Applicants claimed, to cut all contacts 23 with Mr. Giraldi. The Division presented 24 testimony, and ample testimony we believe, from 25 Sgt. Daniel McCullough during the trial and no 52 ITEM NO. 13 1 less than 17 Philadelphia Police Department 2 surveillance reports which document Mr. Giraldi 3 as a Philadelphia LCN associate, and a 4 recurring presence at LCN-related events. 5 These included picking up, with Anthony 6 Accardo, Mr. Merlino and his wife from the 7 airport which Mr. -- which Sgt. McCullough 8 testified only someone in a position of trust 9 would be given that job to do. They include 10 Mr. Merlino picking up Mr. Giraldi so that Mr. 11 Merlino could go to a meeting with Mr. Angelina 12 in which Mr. Angelina and Mr. Merlino engaged 13 in a verbal argument in front of Mr. Giraldi. 14 These are the type of things, as Mr. -- as Sgt. 15 McCullough testified would not just happen with 16 you or I or someone else off the street. These 17 are only the types of things that would happen 18 with a -- someone in a position of trust. 19 Mr. Giraldi was also listed as an 20 associate on the chart entitled "Philadelphia 21 Crime Family Members and Associates as of 22 November 2005." 23 This brings me to the next departure, as 24 the Division sees it, from the precedent in 25 this initial decision which is so troublesome 53 ITEM NO. 13 1 to the Division. 2 The Division entered into evidence 3 volumes of telephone records in this case. The 4 purpose of doing this simply was that phone 5 records, at least it was our understanding 6 before this initial decision, are a pretty 7 cut-and-dried way to show contact with people. 8 You either called someone or you didn't. They 9 either called you or they didn't. The phone 10 records don't lie. In this case the 11 Division -- the telephone records the Division 12 presented to the hearing examiner showed over 13 4,000 calls to and from the Applicants and Mr. 14 Giraldi, 12 telephone calls to Joseph N.'s 15 unlisted home number from Marty Angelina while 16 he was in federal -- while he was in the 17 federal detention center in Philadelphia 18 between July 2000 and November 2001, seven 19 phone calls from Joseph "Skinny Joey" Merlino 20 to Joseph N. Merlino's phone number while he 21 was in federal prison, between July and 22 September 1997 131 calls between numbers 23 registered to Bayshore and the Angelina 24 residence, between July and August 1998, 56 25 calls between the Angelina residence and phone 54 ITEM NO. 13 1 numbers registered to Bayshore Rebar, between 2 November 1998 and February 1999 four telephone 3 calls from Bayshore telephones and/or the 4 Merlinos' personal lines to the home of Phil 5 Ligambi. There was no explanation given at the 6 trial with regard to these calls. There were 7 also 354 calls between November 1998 and 8 January 2003 from the Applicants' telephones to 9 the Angelina residence. 10 Now, in recognition that there were a 11 ton of telephone calls -- and I just heard Vice 12 Chair with regard to -- Vice Chair Harrington 13 with regard to Item 19 thanked Counsel Briliant 14 with regard to making a chart. The Division 15 tried to simplify and break down all of the 16 voluminous telephone calls and presented charts 17 at the hearing trying to break down all the 18 telephone calls and aid in the hearing 19 examiner's review of all those telephone calls. 20 So it wasn't as if we just dumped three boxes 21 of telephone calls in front of the hearing 22 examiner. We did try to break it down and 23 simplify it, for lack of a better term. 24 A troubling new standard or concept is 25 contained in the initial decision in the 55 ITEM NO. 13 1 hearing examiner's evaluation of these 2 telephone calls, that this decision going 3 forward will require -- or states that contact 4 alone is not sufficient in order to prove an 5 inimical association. It's the Division's 6 understanding based on a reading of this 7 initial decision that this Commission, if this 8 initial decision is accepted, will now require 9 going forward to know the content, substance of 10 these telephone conversations. If this is 11 accepted, solid evidence of contact via 12 telephone records as was presented in this 13 case, we believe, will be rendered meaningless 14 in Commission proceedings without further 15 evidence obtained from a criminal wiretap or 16 something of that nature. 17 The Division believes these shifts in 18 the precedent of this Commission as a result of 19 adopting this initial decision go against the 20 fundamental precept of the Casino Control Act 21 to not let organized crime get its foot in the 22 door of Atlantic City casinos. 23 Concepts in the current Commission 24 precedents such as association is inimical if 25 it presents the danger of influence or control. 56 ITEM NO. 13 1 No requirement for it to wait until potential 2 control by a career offender manifests itself 3 in criminal behavior by the career offender's 4 association. No proof of actual influence need 5 be shown by the Division. Need not be evidence 6 of actual criminal behavior by the associate, 7 nor is it necessary that there be direct 8 evidence showing actual influence or control by 9 the disqualified or unsuitable individual. 10 Sufficient if there is evidence of a potential 11 for influence which may be shown by 12 circumstantial evidence. It's the Divisions 13 contention that these precedents long held by 14 this Commission will be no more if this initial 15 decision is accepted by the full Commission. 16 The Division believes that it has 17 produced more evidence in any other organized 18 crime case in the past, and now the standard is 19 shifting before our eyes. 20 This was not a case involving Applicants 21 who are new to the system. These folks have 22 been denied twice before based on inimical 23 associations. These were not people who were 24 unaware of the Commission's rules and 25 regulations and what this Commission was 57 ITEM NO. 13 1 looking for and looking for them to do in order 2 to be licensed. Chair Smith admonished them 3 very clearly that it is necessary that every 4 reasonable effort be made to disassociate from 5 people like Joseph S. Merlino, including 6 refraining from attending family functions 7 where his presence is expected. Did they do 8 that? Our contention is they not only didn't 9 stop, they intensified their contacts with 10 organized crime people. They would have this 11 Commission believe they heeded that warning 12 sometime between 1999 and 2003, although they 13 can't tell us when. 14 They would have you believe that it 15 wasn't Chair Smith's decision that crystalized 16 that they needed to stop the associations even 17 though it was -- he was the chair of the 18 Commission telling them you need to stop these 19 associations. It was when Joseph S. went to 20 jail. That's what did it for them. So the 21 fact that this Commission told them in 1997 you 22 need to stop associating, that meant nothing to 23 them. They were angry at that decision, and 24 their reaction was associate with whoever they 25 wanted to associate with. 58 ITEM NO. 13 1 And those people included some of the 2 highest level members of Philadelphia LCN. 3 Again, Martin Angelina, Steven Mazzone, Joseph 4 Ligambi, Albert Lancellotti, Anthony Accardo, 5 Michael Lancellotti. So rather than 6 disassociate from these folks, they openly had 7 contact, both social and over the telephone, 8 for several years after the ruling. If such 9 wanton disregard of the Commission prohibitory 10 order, especially in the area of organized 11 crime, inimicality doesn't warrant a denial, 12 then we just don't understand what does from 13 the Division's side of things. 14 We take our guidance from this 15 Commission based on its rulings and precedents 16 in deciding what facts to bring before you and 17 what is objectionable. The Division argues 18 that prior to this initial decision, it 19 believed it presented a case which showed that 20 the application of Bayshore Rebar and Phyllis 21 and Joseph N. Merlino as qualifiers should be 22 denied based on their continued inimical 23 associations with Philadelphia LCN. 24 We ask that you acknowledge all the 25 evidence in the record and vote to reject the 59 ITEM NO. 13 1 initial decision. 2 I'll be happy to answer any questions 3 you have. 4 CHAIR KASSEKERT: Thank you. 5 Let me ask if there are any questions 6 now? Or would you like to hear from Mr. 7 Donnelly? 8 COMMISSIONER FANELLE: Like to hear from 9 Mr. Donnelly. 10 CHAIR KASSEKERT: Mr. Donnelly? 11 MR. DONNELLY: Thank you. Good morning. 12 John Donnelly on behalf of Bayshore Rebar, 13 Phyllis and Joe Merlino. 14 With me today are Phyllis Merlino, 15 Joseph Merlino. Somewhere in the room all the 16 sons, Nick and Marco. Nick, Marco are working 17 on the Somers Point Bridge job, so they're 18 dressed for that. And Kim, who is the 19 daughter. Missing is Marc's twin brother -- or 20 twin sister who lives out of state. 21 I'm happy to be here today. It's been a 22 long, long grueling process for me, for the 23 Division, and I -- and for this Commission. 24 This process really started about 20 years ago 25 when the Merlinos first started working in the 60 ITEM NO. 13 1 casino industry. But the process we're here 2 for today started in 2002. In 2002 the 3 Merlinos filed an application to be licensed. 4 Now, typically, an application like that 5 is sent to the Division of Gaming Enforcement, 6 and the Division of Gaming Enforcement acts on 7 it within a reasonable period of time and 8 issues a report. No report came out. 2002 9 became 2003 became 2004, '5, '6, '7. I'm 10 sorry. 2000 -- I misspoke. It was five years 11 that the Division sat on that application and 12 issued no report, issued no piece of paper. 13 We finally filed an application before 14 this Commission in January of 2008 after 15 speaking to the Division and asking them, when 16 are you going to issue a report after five 17 years of not issuing one? When no report was 18 forthcoming, we filed an application with this 19 Commission, January, I think, 11th, 2008, 20 asking the Commission to order that a report at 21 least be issued. 22 That issue -- that application was 23 deemed moot after the Division agreed to 24 finally issue a report, which it did in March 25 of -- March of 2008. Five years after the 61 ITEM NO. 13 1 application had been filed. 2 Never an explanation as to why it had 3 not even processed the paperwork. The 4 Commissioner, Commissioner Sommeling, in his 5 initial decision, noted that this entire 6 proceeding was -- I think contentious, 7 protracted, and other adverbs and adjectives. 8 It was -- it was two years after the 9 report was issued before we were able to get to 10 a hearing. We couldn't get to that hearing 11 because some extremely routine discovery orders 12 had been made by the Commission to allow a very 13 limited two depositions and to allow -- and to 14 require that documents be provided by the 15 Division. 16 Those two orders, which are precedential 17 in this Commission and in the ALJ and anywhere 18 else in this state, were ignored, stonewalled, 19 and then ultimately when more motion practice 20 from this side came across the table, objected 21 to in front of the Commissioner Sommeling. And 22 when he ruled, it took exceptions to that and 23 asked for reconsideration. When that was 24 denied, in two cases they brought to the full 25 Commission, Commissioner Kassekert. And when 62 ITEM NO. 13 1 that was denied, they took it to the New Jersey 2 Appellate Division. And when that was denied 3 and came back, they still didn't comply. And 4 Commissioner Sommeling had to order them again 5 to comply. And they never complied today. 6 They told us varying stories. We don't 7 have documents. The documents are privileged. 8 The documents are law enforcement. The 9 documents can't be given out because they have 10 secret investigations. Each story -- 11 MR. ROGACKI: Objection. If I may, with 12 all due respect to Mr. Donnelly, I'm going to 13 object to the characterization that we still 14 don't have documents. We had a 14-day trial. 15 The trial wouldn't have started unless the 16 hearing examiner determined that all the 17 documents in discovery had been turned over, 18 and discovery had been complete, and the trial 19 could begin. 20 CHAIR KASSEKERT: I'm going to overrule 21 that objection. 22 MR. ROGACKI: Okay. 23 MR. DONNELLY: With all due respect to 24 Mr. Rogacki, he was not at the trial, nor was 25 he present in any of the proceedings I was 63 ITEM NO. 13 1 aware of. I did see him sitting in the 2 courtroom, perhaps, two days. 3 We didn't receive all the documents. In 4 fact, we were told when we deposed Special 5 Investigator Recke in a videotape deposition, 6 first one, and the second when -- when SI Recke 7 was ordered not to answer -- I won't say the 8 number of questions. My memory is 26 times. 9 May have been more. And was ordered to come 10 back and answer the questions, he testified 11 that after we had made the request for 12 documents in this case -- afterwards -- a 13 supervisor of his came to him and said to him, 14 make sure you've destroyed all the documents. 15 Make sure you've destroyed all the documents. 16 On the record in the evidence in this hearing. 17 Now what do we do? We went back and to 18 Commissioner Sommeling again. Commissioner -- 19 the very Commissioner that this Division has 20 accused of bias, accused of incomprehension, 21 accused of worse. And he accepted what I would 22 have never accepted, the representation that 23 this was, oh, standard operating procedure, 24 which is what the Division said. And we always 25 destroy our documents. I asked many, many 64 ITEM NO. 13 1 times for that standard operating procedure. 2 Copies of it. None. Documents were destroyed. 3 Only after repeated orders did we receive 4 documents. Even then, at first, it was with a 5 privilege log that first said nothing was 6 available. Requests for admissions were not 7 answered. When they were ordered to be 8 answered, the request for admissions came back 9 saying we don't understand the request. And 10 then they were ordered again. They finally did 11 answer those. 12 At the end of this protracted process, 13 we gave up. It wasn't worth the candle anymore 14 to spend the money and time to continue to get 15 documents that we hadn't received. Thus, I 16 say, and I stand by it, we still haven't 17 received documents. And I add documents were 18 destroyed that we should have had all along. 19 Now, why is there -- why was this so 20 acrimonious? I don't know. I really don't 21 know. It's not my job to know that. I'm an 22 advocate for a client. It's not my -- either 23 my job, and it would be completely presumptuous 24 of me to tell the Division how to run its shop. 25 I don't stand here to do this. I'm here on 65 ITEM NO. 13 1 behalf of clients. But I do know after 30 2 years of doing this, I've never seen a case 3 like this. At the very first day of the first 4 of the 14-day hearings here, I played part of 5 that videotape deposition of SI Recke. And I 6 botched it because I didn't know how to get 7 the -- it technically to work. But we 8 ultimately had a number of laptops so people 9 could look at. In that deposition, which again 10 is in evidence, about a third of the way 11 through the deposition, I asked SI Recke a 12 question. I said words to the effect: 13 Investigator Recke, have you ever heard words 14 to the effect 'round the Division of Gaming 15 Enforcement that no one with the name "Merlino" 16 will ever be licensed? I think the time -- 17 because we timed it afterwards. I think it was 18 43 seconds where Mr. Recke looked at the 19 ceiling, looked at his shoes, looked at his 20 counsel, leaned back in his chair, and then 21 answered "I don't recall." 22 Now, I said, after I played that tape, 23 that SI Recke, I think is a decent man. I 24 still hold that feeling. But I think he was a 25 decent man being put in a very tough situation. 66 ITEM NO. 13 1 Because I believe that was the mantra at the 2 Division, that no one with the name "Merlino" 3 would ever be licensed. And I also believe 4 that if that weren't the mantra, Inspector 5 Recke would have said, no. Never heard of 6 that. He didn't. 7 I almost brought that video to play 8 again today, but I figured I would botch it 9 again. But it's in the record. You have it. 10 And I invite all of you to look at it. 11 Now, part of this tension is good. And 12 part of this acrimony is good. And I want to 13 say I'm going to say some very harsh things 14 about the Division, but I don't mean that by 15 everybody in the Division and the institution. 16 I -- I have what I think are good friends in 17 the Division. I have a lot of respect for a 18 number of people in that Division, 19 professional, personally. Mr. Rogacki wasn't 20 there trying this case. I harbor no ill will 21 to him. 22 But it was extremely difficult and 23 extremely costly. I will say to this 24 Commission, without being able to calculate, 25 this had to cost a million dollars. Between my 67 ITEM NO. 13 1 fees, the Division's, there was always two 2 lawyers on their side. The -- plus, as I said 3 many times, there were people sitting here. 4 And the Commission times. Had to be a million 5 dollars for a Class C CSI license. 6 But part of this tension is good. It's 7 built into the system. The legislature decided 8 we're going to have the Division who is the 9 prosecutor, and we're going to have a Casino 10 Control Commission that is the -- essentially 11 the judge. And why is that? Well, it's for -- 12 it's in our DNA. It's the way we do things in 13 this country. We all saw maybe last year or 14 maybe it's two years ago. I remember when a 15 young lady was murdered, and I think it was 16 Italy, but it may have been France. And I 17 remember watching TV, and they had the judge 18 there. And he the judge was ordering the 19 investigation, hiring the investigators, 20 directing the investigators, and then hearing 21 what the investigators said and made a 22 decision. And that seemed so odd to me and 23 everyone else I talked about it. And it is odd 24 to us because that's not the way we've ever 25 done things in this country. We've always done 68 ITEM NO. 13 1 it the way this legislature did it. We have an 2 adversarial process. The Division comes 3 forward, and it makes its proofs. And the 4 applicant comes forward and makes its proofs. 5 And an impartial fact finder finds that. 6 Why do we do that? Why do we spend a 7 million bucks, if that's the number, and 14 8 days and two years of discovery? Well, there's 9 a good reason. Because that's how the truth 10 comes out. We've learned -- we learned over 11 hundreds of years this, that truth can't hide 12 from that process. It cannot hide from 13 witnesses sitting in that stand being 14 cross-examined by adversaries. It comes out. 15 And it came out in this case. It came out in 16 this case as the witnesses the Division put on 17 the stand either left the room, collapsed, or 18 evaporated entirely when put to their proofs. 19 And what was found, the truth that was 20 found out, was that this family, the Merlinos, 21 should be licensed. And that's what 22 Commissioner Sommeling found after 67 pages of 23 comprehensive initial decision. Weighing all 24 the evidence. 25 Now, Mr. Rogacki says we're taking some 69 ITEM NO. 13 1 precedent, and we're put putting it off the 2 table. Well, let me -- I pulled out the -- the 3 summary judgment motion, what was called a 4 summary judgment motion, which was made I think 5 right before this trial -- well, actually, it 6 was made sometime in the spring, I think, of 7 2009. And it led to a decision by Commissioner 8 Sommeling in April 22nd. I do remember that 9 date. The Division, before we went to trial, 10 filed what they called a summary judgment 11 motion. They had no affidavits with it. They 12 had no certifications. And it is essentially 13 refiled its complaint that it had put in in 14 this matter. And it gave to Commissioner 15 Sommeling, it gave him -- it had three boxes of 16 telephone records, many of which we had given 17 to them. My side had given to them. My side, 18 Phyllis Merlino, had given to them over the 13 19 years that they've been investigating them. 20 In that summary judgment motion, they 21 cite Brad Smith, former Chairman Brad Smith, at 22 Page 4. And they say, they cite the second 23 Bayshore case, and they say what Brad Smith did 24 and endorsed what he did in finding Bayshore, 25 Phyllis Merlino and Joseph N. Merlino, 70 ITEM NO. 13 1 disqualified under 86f. And then then Chair 2 Smith analyzed the "nature, quality, and scope 3 of the association between the two qualifiers 4 and Joseph S. 'Skinny Joey' Merlino and 5 assessed such factors as the recency of the 6 association, its duration, its purpose and 7 intensity, the associate's reputation, the 8 applicant's knowledge of such reputation, and 9 the termination of the association and the 10 reasons therefore." 11 That is precisely what Commissioner 12 Sommeling did here. He took the two cases that 13 the Division cites, Bayshore Two and Staluppi 14 decision. I cite those in my brief. And to 15 quote from my brief at Page 8 and Page 9 -- and 16 these are quotes from the Bayshore decision 17 that they say Commissioner Sommeling deviated 18 from -- quote -- well, this isn't a quote. 19 This is my writing. In Bayshore Two, the 20 hearing examiner, defined "inimical 21 association" as those present "the danger of 22 unsuitable, harmful or illegal practices in the 23 gaming industry," including, "a continuing 24 voluntary and knowing association with career 25 off fenders." Some examples that Commissioner 71 ITEM NO. 13 1 Smith gave in Bayshore are -- that -- that the 2 hearing examiner is supposed to weigh, where a 3 person does not know the reputation of the 4 associate, where there is insufficient -- 5 quote -- insufficient evidence to conclude a 6 relationship is inimical, where there is no 7 proof of illegal or unsuitable purpose, where 8 there are infrequent and insignificant 9 contacts. 10 And Commissioner Smith in Bayshore Two 11 concluded that such factors must be 12 concluded -- or must be considered as how 13 recent was the association, the duration of the 14 association, the purpose of the association, 15 the intensity of the association, the 16 associate's reputation, the Applicant's 17 knowledge of the association's reputation, when 18 and where the association terminated, the 19 reason for the association? All those factors 20 the precedent of this Commission has made clear 21 must be weighed by the finder of fact in 22 determining whether an association is inimical. 23 Now, why is that? It makes perfect 24 sense. First of all, the burden is on the 25 Division of Gaming Enforcement to prove -- to 72 ITEM NO. 13 1 come in and give real proof to show that an 2 association is inimical. 3 The first two times that Phyllis and Joe 4 came in here, they -- they were under -- and 5 they're still under a cloud of familial 6 relationships. This group was family, has a 7 remarkable history that was presented in this 8 14 days. Phyllis Merlino was 16 years old when 9 she married Joe -- married Lawrence Merlino. 10 He was an iron worker. He wasn't a mobster 11 then. Five years later, she's got -- or I'm 12 sorry. When she's -- by the time she's 22, she 13 has five children. Her husband is now in 14 organized crime. He physically abuses her. He 15 mentally abuses her. And finally when he threw 16 a weapon at her, a knife, and harmed her child 17 who was in her arms, she left him. With 18 nothing. Left her marital house. And, in 19 fact, gave it up because he knocked her on the 20 street and said sign the paper, to sign over 21 her house. Some mobster girl, huh? 22 Where did she end up? She lived with 23 her grandfather in a two-room row house. 24 Grandfather in one house, Phyllis and five kids 25 in the other house. She moved from there. She 73 ITEM NO. 13 1 ended up pillar to post in Cherry Hill living 2 with five young children. No car, working at 3 Aamco Transmission repair shop and a pool 4 repair installation shop. Her son, by that 5 time Joseph, ten, working there, too. Cleaning 6 transmissions. Digging out pools. Ten years 7 old. 8 They left there and ended up -- got -- 9 couldn't live there. No car. No ability to 10 even grocery shop except through the help of 11 neighbors and so on. And moved to another 12 house that her sister owned. Her sister is 13 down in Texas. Sister got divorced, came back, 14 Phyllis is homeless again. At that point, who 15 she had been separated from Lawrence Merlino 16 for years. She called Lawrence Merlino up out 17 of desperation and said, you got to put a 18 house -- a roof over these kids' home [sic]. 19 And he allowed her to move into a house he had 20 at the shore. Down at the shore. 21 What about Joe Merlino? Ten-year-old 22 kid working, went down to visit his uncle in 23 Texas where his sister -- or his aunt was and 24 uncle. And learned the rebar business from his 25 uncle who has -- worked for a big company down 74 ITEM NO. 13 1 there. Came back, dropped out of school at the 2 age of 15, started working in the rebar 3 business. Been working ever since. Worked in 4 the rebar business before he was legal to do 5 it. Wasn't even 18 years old. Started 6 working. Got -- as soon as he turned 18, got 7 into the iron workers local. 8 So and he worked down here, and he 9 worked for the business that his uncle was 10 involved with, which was owned and operated by 11 organized crime guys. But he split out from 12 them. 13 First time he was denied a license, Joe 14 and Phyllis and the company was because of 15 associations with their father, which they had. 16 And Lawrence Merlino was organized crime. No 17 question about it. And there were relations. 18 The second time before Brad Smith -- who 19 I consider a personal friend and have great 20 respect for. Brad Smith heard testimony, and 21 he ruled that there were inimical associations 22 there. And why were there? There were three 23 reasons, really. Number one, they all revolved 24 around a cousin who is also named Joe Merlino, 25 Joe S. Merlino and sometimes called "Skinny 75 ITEM NO. 13 1 Joey." Joseph S. Merlino had stayed overnight 2 at the Merlinos' house because there was going 3 to be a ceremony for a child that had passed 4 away. One night. I think Joseph and Phyllis 5 had gone to a family affair in Philadelphia 6 and -- one time. And Joseph, when he was 7 coming out of jail, the probation officer 8 called Phyllis and said, would you give a job 9 to Joseph Merlino if he came out? Now, the 10 record's garbled on what happened. We know 11 what happened because she didn't give him a 12 job. But, be that as it may, on the basis of 13 that, essentially Brad Smith ruled against 14 them. 15 They didn't understand that. And they 16 were angry and emotional and felt that, as they 17 both said to me, if Christ came off the cross, 18 we can't get licensed. I didn't understand it, 19 either. I read the opinion. And I thought, 20 this -- this shouldn't keep them from getting a 21 license. But I thought about it. And we 22 talked. I talked with Phyllis and Joe and the 23 whole family. And I said, let's analyze this 24 thing. And I'm supposed to know what -- how 25 this works. But I really didn't get it. But 76 ITEM NO. 13 1 we all kind of collectively got it. And we -- 2 I know exactly what Brad Smith was saying now. 3 You can't license anybody in this industry, 4 including a C CSI, the lowest form of licensing 5 next to a hotel employee. License them and 6 then have them be seen in the presence of 7 organized crime people. You can't do that. It 8 may be -- may be arguably unfair to the 9 applicant, but you can't do that. Because for 10 all the reasons that you all know, and probably 11 everybody in this room knows, we've got the 12 integrity in the industry that people in this 13 industry depends on, assuring the public that 14 there are no organized crime guys. 15 We all understand that now. And they 16 testified that -- to that effect. But, more 17 importantly, before they ever met me, in 2000, 18 give or take -- and there is no precise date. 19 They didn't sit down and keep minutes of a 20 family meeting. But in the area of 2000, the 21 family members said, look, we -- we have lost 22 our reputation. We're a very successful 23 business. But they don't have a reputation. 24 They've lost that. And we -- that is more 25 valuable to us than, unfortunately, friends and 77 ITEM NO. 13 1 family. Because they realized that, even 2 though they have family that are involved in 3 organized crime, they can't see their family. 4 Even if it's a Christening, even if it's a sick 5 child, even if it's a graduation party. They 6 can't do it. And they also realized -- if they 7 wanted to be licensed. And they also realized 8 that they may even have to sever friendships 9 that are unrelated to organized crime. Because 10 people -- Phyllis was friendly with women who 11 were married to -- to guys who were in 12 organized crime. She knew them. She grew up 13 in that neighborhood when she was a child. She 14 knew them through her husband. They made that 15 decision. 16 As Commissioner Sommeling found, they 17 cut off all ties. Now, Mr. Rogacki is right. 18 In the '97, '98, '99 period, they did -- they 19 were seen occasionally with these people. And 20 when this motion of summary judgment was made, 21 we argued that case. And I said, look, if 22 that's -- if that's -- we readily admit to 23 that, and we'll tell you why. But if that's 24 the death penalty, and if there's no redemption 25 from that, the case is over. But I think that 78 ITEM NO. 13 1 isn't the death penalty, and I do think there's 2 redemption from that, and there has been that 3 redemption, as the Commissioner found after 14 4 days of testimony and 13 years of 5 investigation, that those ties are completely 6 severed. 7 And I say to you, and they said it, 8 however this body decides, they will never have 9 any associations with any of those people, that 10 side of the family or those -- those seedy 11 people ever again. Up or down. That's over. 12 You will never read in the paper. You will 13 never see it. You will never hear it. 14 Let's talk about what's really at issue 15 here: Good character, honest, and integrity. 16 Let me tell you what's not an issue. In the 20 17 years of investigations -- I say 17, but it 18 started back in the late '80s. No one -- no 19 one has ever suggested -- the Division -- 20 there's four, former FBI agents sitting in the 21 audience, Jim Darcy, Gary Langan, and Steve 22 Ruiz, Larry Schneider. Those -- those four 23 men, together with another FBI agent who 24 testified at this trial, were the people who 25 put the Scarfo, Merlino mob in jail, who 79 ITEM NO. 13 1 prosecuted these guys. Collectively, the FBI 2 witnesses who testified here and collectively 3 in excess of 150 years of law enforcement 4 background? Each one of these men here -- 5 Steve's a youngster, but the other ones are 6 20-, 30-year veterans. Gary was responsible 7 for -- well, they all were responsible for 8 debriefing people -- debriefing arms of laundry 9 lift of mob characters. Gary was, in 10 preparation for testifying here, actually went 11 to Phil Leonetti who was credited -- it's in 12 the record -- credited by the US Attorneys 13 Office as being -- he turned State's evidence 14 the most credible and helpful witness that the 15 US Attorneys Office had had. And I think was 16 responsible, I think approximately 39 17 convictions of mob characters. He went to Phil 18 Leonetti, who was under the witness protection 19 plan, and asked him two questions. And he 20 debriefed all these guys for years. "Babysat" 21 them, they called it. Have you ever heard 22 Phyllis or Joe Merlino or Bayshore had anything 23 to do with organized crime? Answer: No. 24 Unequivocally. No. Never. 25 The second question he asked is about 80 ITEM NO. 13 1 Giraldi, who I'll come to later. But three 2 cooperating witnesses, one of which he could 3 name, and the other two he could not name 4 because of their circumstances, told him he had 5 never heard of Mr. Giraldi, this mystery person 6 that the Division raised. But I think it's 7 important, no one has ever suggested that they 8 were part of, associate -- or an associate, 9 which has a term of art or a member of 10 organized crime. 11 When they first came to Resorts and Taj, 12 Resorts owned it at the time. Bob Peloquin 13 took the stand. Bob Peloquin is a storied guy. 14 In books all over the place. He was the 15 first -- he started the United States Strike 16 Force with Bobby Kennedy. He was -- he went 17 from city to city in the early days with the 18 Strike Force that had IRS, drug, US Attorneys 19 Office, and other. Together the idea is to go 20 from city to city and eradicate the mob in each 21 city. He went on to have a private -- as 22 Commissioner Sommeling said -- counseled the 23 NFL. He had a private investigation 24 organization. He had clients like the Shah of 25 Iran and Howard Hughes and has worked very 81 ITEM NO. 13 1 close -- and all made up of ex-NSA people and 2 FBI people, and border patrol people, and 3 Diplomatic Corps people for overseas things. 4 And Bob Peloquin got in here, and he's in his 5 eighties now. And said, you know, when we 6 first came to Resorts, I was working for 7 Resorts, then. And I got wind right away. Oh, 8 Merlino. Bang. The light went off. So I sent 9 the guy -- whose name is virtually 10 unpronounceable, but -- Vadja Kolombatovic, 11 who's -- who is with the FBI and had been the 12 head of security for the Diplomatic Corps in 13 Europe, sent him to the FBI, and I think he 14 testified -- it's in the record -- DEA and 15 elsewhere, find out about this -- this Joe 16 Merlino and Phyllis Merlino. Came back clean. 17 They're not part of the mob. Their father is, 18 but they are not. So for 20 years, everybody 19 has known, and the Division's known, that they 20 are not part of the mob. They know that. They 21 knew it then. 22 We addressed the good character, 23 honesty, and integrity issue, which is our 24 burden. And we addressed the inimical, too. 25 We talk about the good character, honesty, and 82 ITEM NO. 13 1 integrity. We brought in -- actually there 2 were over seven FBI agents involved, counting 3 Bob Peloquin, who really wasn't FBI. He was 4 Department of the Justice. But either with 5 direct testimony or through, for example, Mr. 6 Darcy, who ran the Linwood office of the FBI. 7 They all testified that they knew the Merlinos 8 or knew of them. The Merlinos had never been 9 involved in any criminal activity whatsoever. 10 To the best of their knowledge, they were -- 11 had people, persons, of good character, 12 honesty, and integrity. 13 Now, why on would they do that? We 14 weren't paying them. They weren't -- with the 15 exception of Mr. Darcy was a -- Mr. Darcy's 16 firm we hired. But they came in to right a 17 wrong. 18 Larry Schneider -- Larry, raise your 19 hand. Larry was -- Larry was supposed to 20 testify in Bayshore No. 2 case. And here's 21 what happened. The Division knew he was going 22 to testify and heard that he was on the list. 23 And this was testified to by Mr. Darcy and by 24 Mr. Schneider. When they saw that Larry 25 Schneider was going to come in and testify on 83 ITEM NO. 13 1 behalf of the Merlinos, this was Bayshore Two, 2 case before Brad Smith, the Division called Jim 3 Darcy, who was then -- just recently became the 4 head of the Linwood office. And it said -- 5 they said to him, hey, we see that Larry 6 Schneider is going to testify. Can't you do 7 something about that? Darcy went to Schneider 8 and said, you know, maybe you shouldn't do 9 this. You better go to the US Attorneys Office 10 and find out if it's appropriate to do this or 11 not. Larry went and they -- US Attorney said, 12 it's better if you stay out of it. 13 What -- what rhyme or reason would the 14 Division have for calling up Jim Darcy and 15 saying do something about Larry Schneider? And 16 both men regretted that for years and years, 17 felt that they had been used. So Larry was 18 eager to come back in and testify. So was Jim. 19 The good character, honesty, and 20 integrity. Ten witnesses came forward, 21 testified to Joe Merlino and Phyllis Merlino as 22 a neighbor, as a businessman, as a union 23 leader -- and I don't mean union leader. He's 24 on the management side. But he's on several 25 trusts -- he's trustee of several trust funds 84 ITEM NO. 13 1 for employees that manage millions and millions 2 and millions of dollars. Neighbor came in and 3 said just, great guy. 4 SI Recke, the main investigator on this 5 case, when I deposed him -- he didn't appear at 6 trial by the way, but I deposed him twice. SI 7 Recke, I asked him. Again, it's in the record. 8 We put the deposition in. In your -- I think 9 it was four years of investigating the 10 Merlinos, did you ever hear anyone say that 11 they lack good character, honesty, integrity? 12 Anyone? Answer: No. 13 The good character, honesty, and 14 integrity of keeping this family together 15 through this adversity, building a business, 16 keeping all these kids out of organized crime 17 and persevering with all this, I think, 18 demonstrates a lot. It also demonstrates their 19 willingness to recognize that they were wrong 20 about Brad Smith's decision, which they readily 21 recognize. 22 Now, let's talk about the inimical 23 associations. Yes. As we talked about the 24 '97, '98, there were some telephone calls as 25 well. Those evaporated on the stand under 85 ITEM NO. 13 1 cross-examination under the process that is 2 here. Although the Division says and said in 3 its brief that, well, these calls that were 4 from -- perhaps from a woman who is married to 5 a person of organized crime to Phyllis Merlino 6 or back, that's how the mob sends secret 7 messages. Every FBI agent who testified said 8 that's not true. And the Division has no 9 evidence, zero, not one person to suggest 10 otherwise. They just said it. 11 The Marty Angelina calls from jail? We 12 had a woman by the name of Chrissy Collaretti 13 come in and testify that she was cousins with 14 Marty Angelina's then wife, woman by the name 15 Belcastro, and those calls were from the 16 husband to the wife while she was visiting with 17 the Merlinos. At that time Chrissy was dating 18 Joe and had been dating him for years and 19 virtually lived at the house. Phyllis 20 testified to the same. No rebuttal from the 21 Division. 22 The Joe Merlino, S. from jail, testimony 23 that those calls were primarily -- I think -- I 24 don't know if Lawrence is here -- or not? 25 Lawrence? Grandson, grandson Lawrence who is 86 ITEM NO. 13 1 trying to get into the business of music. And 2 Joe was calling from prison telling him -- 3 blowing smoke, in my opinion -- about that. 4 And what he can do in the business, the music 5 business. And when Phyllis found out about 6 that, she told Lawrence not to talk to him. 7 Joe, when he got a call from his cousin, 8 changed his cell phone number so he couldn't be 9 found. Oh, this stuff about secret phone -- 10 cell phone number. Everybody knew that cell 11 known number, and everybody testified they 12 knew -- not that cell phone number. That 13 unlisted number. Everybody -- everybody -- 14 every friend, all these women knew that. There 15 was no secret number. 16 So what was the Division's case? They 17 knew that was going nowhere. They knew that 18 ten years ago some telephone conversations were 19 going nowhere. So they invented the guy, 20 Anthony Giraldi. And here's what they did. 21 They saw -- because, remember, we gave -- 22 Phyllis gave them cell phone records. Had them 23 printed out, gotten them from Verizon or 24 wherever the heck it was, and gave them to 25 them. They saw. And they subpoenaed a bunch 87 ITEM NO. 13 1 of records, by the way. Investigations, 20 2 years. Every -- every tax return, from every 3 individual tax returns, every corporate tax 4 return, every financial statement, never check, 5 every credit card, bins -- six sworn interviews 6 with these people under depositions, 7 innumerable surprise visits to the office or 8 announced visits, interviews with the 9 accountants. They've seen for 20 years every 10 piece of paper they could possibly be looked at 11 to reach a conclusion that something nefarious 12 was going on, all manner. All perfectly clean. 13 In fact, while he was building this 14 business, Joe and Phyllis, it was a big 15 struggle. And they got behind in the payments 16 to union -- to their union pension funds. And 17 I think it was four union men came in. And 18 remember, Joe is on the management side. Four 19 very high-ranking union officials came in and 20 testified that this company, unlike the other 21 companies when the construction business went 22 down in the '80s, they hung in there and paid 23 every single dime in. Never tried to go 24 bankrupt, never dishonored the payments. Took 25 them a while to pay them back, but they paid 88 ITEM NO. 13 1 every dime back into the union funds. 2 So Giraldi. What did they do to 3 investigate Giraldi? For some of these names. 4 Well, this guy is calling Giraldi. He's 5 calling Giraldi. What's this? Who's this? 6 Giraldi. They sent Inspector Graham out to do 7 an investigation. Here's what Graham did. Its 8 in their report. Inspector Graham -- nice guy. 9 He drove to Philadelphia where the address of 10 Giraldi is. He looked at the row house. He -- 11 and then drove four blocks around, and seeing 12 no business name -- because Giraldi was a 13 plumber, and they had been told by Joe and 14 Phyllis that Giraldi was a plumber. Seeing no 15 business, seeing no business name, he concluded 16 there's no business there. Then they looked at 17 Dun & Bradstreet, on-line I assume. And it 18 said that Giraldi plumbing -- so there was a 19 business, but it only had done $20,000 gross 20 business. And, finally, they looked in -- I 21 think looked in the Yellow Pages. And on the 22 basis of that investigation, what I just told 23 you -- drive, look, sign -- they concluded that 24 Anthony Giraldi is an associate of organized 25 crime, a -- involved in bookmaking, and the 89 ITEM NO. 13 1 Giraldi plumbing business is a mere front -- 2 called mere front for a bookmaking operation. 3 Now, I got to tell you, that came after 4 all this other stuff. We're already involved. 5 We saw this thing. I called Jim Darcy. I say, 6 you know, Houston, we got a problem. The 7 Division of Gaming Enforcement who -- who says 8 this is Giraldi who Joe's been hanging around 9 with is a member of the mob. Or associate. So 10 Darcy sends Ruiz down and says, go find out 11 what's going on. Go to Philadelphia. You'd 12 Better find a plunger at this plumber's office. 13 So Steve goes. And all -- or Jim goes, 14 and ultimately Jim goes. And here's what they 15 find. They go and they knock on the door. Who 16 shows up? Giraldi's father, 50-year plumber. 17 They walk around the back -- his grandfather, 18 Giraldi's grandfather was a plumber, too. Same 19 place. They walk around the back of the row 20 house. Plumbing trucks. Plumbing supplies. 21 The whole back of the row house is a plumbing 22 shop. Certificates from -- you know, 23 mercantile licenses. Plumbing supplies. They 24 take 40 pictures of those and demonstrate 25 operating plumbing shop. They -- we put a 90 ITEM NO. 13 1 chart of 20 things that their group did in 2 their investigation. They visited the home. 3 They visited the shop, which is the back. They 4 got 40 pictures. They took pictures of the 5 vehicle. There was a storage vehicle there. 6 They got telephone book listing for Giraldi 7 Plumbing. They got photographs of the plumbing 8 license for Anthony Giraldi and his father. 9 They obtained photographs and certificates 10 acknowledging that Anthony Giraldi's father was 11 a long-term member of the South -- long-term 12 member of the South Philadelphia Master 13 Plumbers Association. 14 They interviewed Giraldi's father and 15 son. They determined that Giraldi, his father, 16 and his grandfather were all licensed plumbers 17 who operated out of the row house. They got 18 the tax returns from the Giraldis. The tax 19 returns from Mr. Giraldi, son Giraldi, and the 20 business. Voluntarily. They gave them to Jim 21 Darcy. And we gave them to the Division of 22 Gaming Enforcement. They spoke to the FBI 23 office in Philadelphia. They interviewed five 24 former FBI agents who have knowledge of 25 organized crime activity in Philadelphia as to 91 ITEM NO. 13 1 whether they had any knowledge regarding 2 whether either Giraldi had ever been an 3 associate of organized crime? No. They had -- 4 Gary Langan talked to his, the cooperating 5 witnesses, the three cooperating witnesses. 6 Never heard of Giraldi. 7 And the Division knew all this. What 8 did they do then? They went to a police 9 officer in Philadelphia, McCullough. And 10 there's a dispute. McCullough gave two 11 certifications, Officer McCullough in this 12 case. There's a dispute as to who drafted the 13 certifications. Recke says -- Investigator 14 Recke who did not come to testify -- said that 15 the Division wrote these affidavits up, and I 16 believe that to be true. Because the 17 affidavits have Mr. McCullough's organization 18 that he worked for incorrect. And I doubt that 19 he would have done that. In other words, they 20 had the wrong name for the branch, bureau that 21 he worked for. 22 But Recke gave a certification that said 23 yet a third officer, another man, told me that 24 this Giraldi was associated with organized 25 crime and had "ties" to bookmaking. And had -- 92 ITEM NO. 13 1 had been to visit Joseph S. Merlino in jail. 2 Well, okay. We're off to the races again. 3 Let's see if we can find out one thing. Did he 4 go visit Joe S. in jail? We go to the jail or 5 the prison. It's a prison. Never. Never 6 visited Joe S. in jail. 7 Oh, and by the way, these nefarious -- 8 supposed nefarious calls from Mr. Angelina to 9 his wife at a telephone at -- when she was 10 visiting Phyllis? The prisons record those. 11 And the Division had any number of 12 conversations with the prison to get those 13 records but never -- either never got them or 14 if they got them, they never presented those 15 tape-recordings. 16 So we -- McCullough -- Mr. McCullough 17 came. He appeared. He sat there. And we went 18 back and forth, and the Division's approach was 19 to have Mr. McCullough read into the record for 20 about a day and a half a bunch of surveillance 21 reports that showed that this Mr. Giraldi had 22 been in the presence of some of these persons, 23 bad persons, 17 times over a ten-year period, I 24 believe it was. Nine or ten years. And he 25 read those in, and he read all the names. I 93 ITEM NO. 13 1 think to try to scare -- all these names of 2 people. 3 So then it's our turn. And we said -- 4 and the certification went into evidence, too. 5 And we said -- we asked some pretty actual 6 simple questions, not well-crafted but simple 7 questions, which were: Do you, Mr. McCullough, 8 have any information to lead you to believe 9 that Anthony Giraldi is or was a member or 10 associate of organized crime? Answer: No. 11 Astonishing. Commissioner Sommeling admonished 12 the witness or advised the witness that he was 13 under oath. 14 Question No. 2, does the Philadelphia 15 Police Department have any knowledge that 16 Anthony Giraldi is or was a member of organized 17 crime? Answer: No. We were so astonished, 18 the record -- you'll see the record. I asked, 19 can I take break for lunch? We talked outside. 20 We said, did we hear what we heard? This 21 guy -- we've been chasing this for months, 22 almost a year, and this -- and these two 23 certifications, and the man just came up here 24 and said no. Everybody said, that's what we 25 heard. We came in and said thank you very 94 ITEM NO. 13 1 much, Mr. McCullough. Go back to Philadelphia 2 from whence you came. 3 It gets even worse. They put Lt. Kuras 4 on the stand. I think -- close to 30 years 5 with the New Jersey State Police. And they put 6 him on the stand, and we asked Lt. Kuras, have 7 you ever heard -- state police organized crime. 8 Have you ever heard of Anthony Giraldi? No. 9 Never heard of him. Thirty years. 10 I asked Recke at his deposition. Have 11 you ever heard of Giraldi? No. Mr. Recke, did 12 you ask the previous investigator on Bayshore, 13 Mr. Peterson, if he had ever heard of Mr. 14 Giraldi? Yes. What did he say? No. Who did 15 you try to find -- did you talk to anyone else? 16 I talked to Walt Coughlin -- Coughlin, 17 Coughlin -- who has been the head of the 18 department before Mr. McCullough came in. He 19 had been there for 25 or 30 years. And he was 20 actually the man that took some of these 21 surveillances where he saw Giraldi before. Had 22 Mr. Coughlin -- Coughlin ever heard of Giraldi? 23 No. Has anyone heard of him other than Mr. 24 McCullough saying in his cert, which he took 25 back, that another officer had told him? No. 95 ITEM NO. 13 1 That's the testimony that came in. 2 Oh, by the way, Lt. Kuras helped us on 3 another matter because in their argument about 4 good character, honesty, and integrity, they 5 say, well, the Merlinos didn't tell the truth 6 at the most recent sworn deposition. And they 7 say the reason they said that is, they asked 8 them a laundry list of name. Have you ever 9 heard of Lawrence Merlino? Have you ever met 10 this guy, that guy, and the other guy? All 11 known organized crime. And they answered yes 12 or no if they they'd ever seen them. And one 13 guy they asked, have you ever met Anthony 14 Accardo? And they both said, no. That name's 15 not familiar to me. Uh, they lied. They lied 16 under oath because you have one of these 1997 17 or whatever surveillances. We see Joseph 18 Merlino and Anthony -- and Phyllis Merlino are 19 at the Greenhouse. Anthony Accardo and some 20 other guy come up while they're eating and talk 21 to them for a while, and then they leave. They 22 leave, these people leave. And these other 23 guys are up in the summer -- these wise guys 24 from Philadelphia are up at the summer in the 25 Greenhouse drinking. And Anthony Accardo was 96 ITEM NO. 13 1 there. Well, we got a problem with that; 2 right? So Joe and Phyllis testified, we now 3 know after going through all this process that 4 Anthony Accardo is a guy we know with the name 5 of Tony Cugeen. Well, don't worry about it. 6 But guess what? Lt. Kuras is in there while 7 he's been examined by Anthony Zarrillo -- or 8 Wendy Way, I forget who from the Division -- 9 and said, oh, do you know Anthony Accardo? Oh, 10 yes. But he's normally known as Tony Cugeen. 11 We didn't even ask it. It came out of the 12 blue. 13 And let me talk about the exceptions 14 here. The exceptions, as I said, accused 15 Commissioner Sommeling of a number of things, 16 which I completely disagree with. I disagreed 17 with any number of Commissioner Sommeling's 18 decisions. I was admonished by him on several 19 occasions. I will -- can admit that I became a 20 bit intemperate on occasions, I guess you 21 should say. And I was frustrated by many of 22 his rulings because he allowed into evidence 23 items that I thought should -- that the 24 Division was proffering that I thought should 25 not go into evidence. But to suggest that he 97 ITEM NO. 13 1 was biased or anything other than perfectly 2 fair is way off the reservation. 3 And the example, the only example, in 4 the exceptions is given, is an example about 5 these reams and reams and reams of telephone 6 records. And that wasn't from the trial. That 7 wasn't from the trial. That was from the 8 motion of summary judgment. Because, remember, 9 I told you that before the trial in the spring, 10 they filed a motion of summary judgment. No 11 affidavits, no certifications. Regurgitated 12 their report. And in there, they gave him 13 three boxes of telephone records. And you can 14 look at the brief, and it says, well, these 15 telephone records show that there was telephone 16 contact between Mr. Merlino and Mr. Giraldi. 17 Well, yeah. They did. And between Phyllis 18 Merlino and Lauren Belcastro. Yes, they did. 19 So what? 20 And what Commissioner Sommeling said in 21 response to that summary judgment motion -- not 22 at trial was, that's why we're having a trial. 23 You've got to come in and address the issues 24 that I read to you earlier from Staluppi and 25 Bayshore Two. Was there association? Is it an 98 ITEM NO. 13 1 inimical association? 2 Nothing -- nothing that Commissioner 3 Sommeling did or said in that report deviates 4 from any precedent in this Commission. This 5 Commission has always had the same standard. 6 The statute, Section 86f, says that in order to 7 disqualify an applicant for inimical 8 associations, you have to show, first of all, 9 that they're associating with someone and that 10 it's for an inimical purpose. "And." It's 11 conjunctive. That's always been the law. 12 Nothing he did changed the law. Nothing this 13 decision will do will change the law. These 14 are fact-specific cases. And it was heard for 15 fact specific. 16 You'll be happy to hear that I'm going 17 to conclude. 18 As I said, this system's in place to get 19 to the truth. We got to the truth. This is a 20 good and decent family. I'm honored to be part 21 of them. I'm honored to be associated with 22 them. I don't have the slightest bit of 23 trepidation standing up here and endorsing 24 them. Nor did the FBI agents, nor did Mr. 25 Peloquin, nor did the ten character witnesses 99 ITEM NO. 13 1 and the 24 people who wrote letters in their 2 behalf. 3 What we have -- we have -- in Phyllis, a 4 fiercely protective mother who somehow or other 5 kept this brood together. And she testified. 6 She said something that was very interesting on 7 the stand. She wasn't on that long, but she 8 said, you know, sometime during this life their 9 roles reversed. And Joe started protecting me. 10 Her son. And it was when he was young. At a 11 young age. And we've got a fiercely protective 12 son. It's funny. If you knew them, they're 13 bickering all the time and arguing and 14 fighting. They work in the same office, 15 which -- but it's a family. 16 And it's a family that somehow or other 17 she, and then later Joe, kept out of this. How 18 attractive would it be for any of us who are 19 teenagers to have a cousin, an uncle, all that 20 who had girls, guns, and money? How easy would 21 it be to drift into that life? But they 22 didn't. She kept them out of it. And then Joe 23 kept them out of it. 24 What they -- and they've built a great 25 business. They've built a great business and a 100 ITEM NO. 13 1 great number of friends and great deal of 2 respect. They're missing two things. They -- 3 they've lost their reputation. They -- look, 4 no matter what happens -- and we've talked 5 about this. When they're out in the community 6 and talk to people, there's no doubt that 7 people say, oh, that's the Merlinos. They're 8 related, and they're part of the mob, and all 9 that kind of stuff. They want to get that 10 back. They want to -- they want the world to 11 know what the FBI knows and the police 12 enforcement agencies know, that these people 13 are not now and never have been a part of the 14 mob. They need the world to know that. They 15 need to have their true character recognized. 16 I -- it's -- you all -- you make 17 momentous decisions every day. People come to 18 you with these complex financial situations 19 and, you know, all these -- all these things 20 with the casinos that are incomprehensible and 21 affect thousands and thousands and thousands. 22 This decision is only going to affect these 23 people. But you have the opportunity, the 24 happy opportunity and the daunting task, but 25 the happy opportunity that you can make a 101 ITEM NO. 13 1 change. 2 And I'm back to the system. I think the 3 Division lost its way here. They decided that 4 no matter what Commissioner Sommeling said, no 5 matter what the Commission said, no matter what 6 the Appellate Division said, we're going to 7 either -- we're going to stop any Merlino from 8 ever being licensed. And if it -- maybe we can 9 break them financially. I don't know. But, 10 fortunately, we're not in the French or Italian 11 situation where the judge is the jury and the 12 prosecutor and the executioner. We've got this 13 body. 14 And this decision, although you make 15 these momentous decisions, this will be a 16 momentous decision to this group. And all I 17 can do as an advocate is urge you to accept 18 Commissioner Sommeling's decision and to reject 19 the allegations contained therein in the 20 exceptions to that decision. 21 Thank you. 22 CHAIR KASSEKERT: Thank you. 23 Let me ask if commissioners have any 24 questions before Mr. Rogacki would like to 25 respond? 102 ITEM NO. 13 1 No? No. No questions? 2 Mr. Rogacki? 3 MR. ROGACKI: Chair, unless the 4 Commission has any questions, at this time, 5 again, unless the Commissioner has any 6 questions, in the interest of trying to avoid 7 getting into further unproductive discourse 8 between the Division and the Applicants and 9 possibly with the Commission and keeping the 10 tone civil at this point, I think it would be 11 best not to start trying to point by point 12 respond to Mr. Donnelly other than to say this 13 Commission has the record before it, the full 14 record of the testimony. It can see for itself 15 what the witnesses testified to. 16 The one point that I do want to make, 17 just because of the cooperation we did have 18 with the Philadelphia Police Department, was 19 the testimony of Sgt. McCullough. I don't want 20 to let that mischaracterization go 21 unchallenged. Sgt. McCullough's testimony -- I 22 would like the Commissioner to look at his 23 testimony at Page 94 and 95, what he said in 24 the public record. Those comments led to Sgt. 25 McCullough asking Commissioner Sommeling to go 103 ITEM NO. 13 1 into sealed session, and there is a sealed 2 portion of the transcript, and I won't get into 3 that on the public record, where Sgt. 4 McCullough clarified his testimony to 5 Commissioner Sommeling. And I do want to make 6 that public statement with regard to the 7 sergeant's testimony. 8 And at this point I'll conclude. 9 CHAIR KASSEKERT: Thank you. 10 MR. ROGACKI: Thank you. 11 CHAIR KASSEKERT: Mr. Donnelly? 12 MR. DONNELLY: Only that that -- that I 13 disagree entirely that he clarified the 14 testimony. 15 And, number two, that played no -- as 16 Commissioner Sommeling pointed out, played -- 17 none of the sealed testimony played any role in 18 the decision. And that's all I can say. The 19 record is what the record is. The words were 20 on the record. And they -- and it was -- 21 Commissioner Sommeling made it very pointed to 22 Officer McCullough that he was under oath. He 23 was speaking on the record. And he would -- 24 that would be the record decision. And if you 25 look at the testimony, you'll see those 104 ITEM NO. 13 1 cautions to the witness. 2 CHAIR KASSEKERT: Thank you. 3 I think we should recess. Since it is 4 12:30, why don't I suggest that we recess 5 til -- 6 COMMISSIONER EPPS: Probably like 3:00. 7 CHAIR KASSEKERT: 3:00? 3:00? 8 MS. FAUNTLEROY: That's your pleasure. 9 CHAIR KASSEKERT: Okay. We will 10 recess -- stand in recess until 3:00. 11 MR. DONNELLY: Thank you. 12 MR. ROGACKI: Thank you. 13 (A recess was taken from 12:28 to 3:20 14 p.m.) 15 CHAIR KASSEKERT: Thank you. You may be 16 seated. 17 We'll go back on the record. 18 Let me ask if the commissioners have any 19 questions at this point? 20 COMMISSIONER FANELLE: I just have a 21 few -- 22 CHAIR KASSEKERT: Sure. Yup. 23 COMMISSIONER FANELLE: -- things I'd 24 like to clarify. 25 Mr. Rogacki, I have a question with 105 ITEM NO. 13 1 regards to the -- for lack of a better term, 2 the organizational chart of the Philadelphia 3 crime family. 4 MR. ROGACKI: Yes. 5 COMMISSIONER FANELLE: I've looked 6 everywhere, and I'm sort of new to the 7 Commission, so I'd like -- who is the author of 8 that? 9 MR. ROGACKI: The answer we got at trial 10 from Det. McCullough and from Investigator 11 Graham was that the chart was -- the chart came 12 from the Philadelphia Organized Crime Unit, and 13 it was compiled based on surveillance reports 14 from that unit. That was -- that was the 15 information that came that was produced at 16 trial. 17 COMMISSIONER FANELLE: Okay. And just 18 one more question. And it's the time frame 19 between the initial application and the 20 response. 21 Does this -- is this normal? Is this -- 22 to take six years? 23 MR. ROGACKI: It depends. The Division 24 is following up leads. The Division is 25 coordinating with law enforcement agencies. 106 ITEM NO. 13 1 COMMISSIONER FANELLE: It's always an 2 ongoing investigation? 3 MR. ROGACKI: It's an ongoing 4 investigation. The Division is working on -- 5 other matters come up. You know, some matters 6 take longer than others. That's the best 7 answer I can give you. 8 COMMISSIONER FANELLE: Okay. Thank you. 9 CHAIR KASSEKERT: Any other questions? 10 COMMISSIONER EPPS: I have a question. 11 CHAIR KASSEKERT: Commissioner Epps? 12 COMMISSIONER EPPS: Mr. Rogacki, when 13 you began your presentation, you said that the 14 Merlinos continued associations just three 15 months after in violation of a prior order. 16 MR. ROGACKI: Correct. 17 COMMISSIONER EPPS: How are they in 18 violation of an order? Because the two -- 19 you're talking about the second -- 20 MR. ROGACKI: The 1997. 21 COMMISSIONER EPPS: The second decision? 22 MR. ROGACKI: Correct. 23 COMMISSIONER EPPS: That order denied 24 them -- denied them their CSI license; correct? 25 MR. ROGACKI: Correct. 107 ITEM NO. 13 1 COMMISSIONER EPPS: But did they have an 2 ongoing obligation to comply with something in 3 that order? Because you said they were in 4 violation of an order. If we denied them, we 5 no longer have them in our jurisdiction so 6 their conduct can't violate our order. I mean, 7 unless I'm missing something. 8 MR. ROGACKI: Understood. 9 COMMISSIONER EPPS: I -- 10 MR. ROGACKI: Understood. But what the 11 language in that order -- the language in that 12 order gave them the guidance to discontinue all 13 associations. 14 COMMISSIONER EPPS: Okay. That's why I 15 was unclear. Because you said their conduct 16 was in violation -- that they were violating an 17 order, meaning they were ordered not to do 18 someing, and they did it anyway. That's why -- 19 MR. ROGACKI: Correct. 20 COMMISSIONER EPPS: And that's what I 21 was confused -- 22 MR. ROGACKI: What I meant to say was 23 they were given guidance in that record that 24 instructed them going forward, if they want to 25 get licensed, discontinue all associations. 108 ITEM NO. 13 1 And they ignored that. 2 COMMISSIONER EPPS: Okay. That -- 3 that's where I was con -- so I mean, it 4 didn't -- 5 MR. ROGACKI: Correct. 6 COMMISSIONER EPPS: Okay. 7 CHAIR KASSEKERT: Anything else? Any 8 other questions? 9 Let me ask. 10 MR. DONNELLY: Miss Kassekert, may I -- 11 CHAIR KASSEKERT: Mr. Donnelly? 12 MR. DONNELLY: -- address Mr. -- 13 Commissioner's question because I have Mr. 14 Graham's testimony here on cross. And at Page 15 183 when I began my cross-examination, Mr. 16 Graham was the man who produced D-20, which was 17 produced on June -- the last day of discovery 18 in this case after Commissioner Sommeling had 19 extended discovery almost a year. 20 Question at Line 2: Did you say that you 21 got that in -- when did you get it: 22 "Sometime in 2005/2006. 23 "QUESTION: You don't know who you got 24 it from. 25 "ANSWER: Probably, someone in the 109 ITEM NO. 13 1 Organized Crime Section in Philadelphia. 2 "QUESTION: Not probably, Mr. Graham. 3 Who did you get it from? 4 "ANSWER: I don't recall. 5 "QUESTION: Okay. You don't know who 6 you got it from. 7 "ANSWER: No, sir. 8 "QUESTION: You don't know where you got 9 it, except sometime in 2005? 10 "ANSWER: That's correct. 11 "QUESTION: Now, do you know who typed 12 this piece of paper up? 13 "ANSWER: No, sir. 14 "QUESTION: Do you know who generated 15 this piece of paper? 16 "ANSWER: No, sir. 17 "Do you know if this piece of paper has 18 ever been used for any purpose whatsoever? 19 "ANSWER: I have used it myself. I'm 20 quite sure other people have used it, too, in 21 my unit. 22 "QUESTION: I'm sorry? 23 "ANSWER: I'm reasonably sure that other 24 people have used this document in this unit." 25 It goes on at Pages 185, 188, 189, 192, 110 ITEM NO. 13 1 and 194 to the same effect. So the actual 2 answer is that Mr. Graham did not know where he 3 got it. He thought he got it sometime in '05 4 from someone in the Philadelphia Police 5 Department. That was it. 6 CHAIR KASSEKERT: Thank you. 7 Let me ask if Counsel has anything else 8 to bring before us at this time? 9 MR. ROGACKI: No, Chair. 10 MR. DONNELLY: No. Nothing. Thank you. 11 CHAIR KASSEKERT: Mr. Donnelly? 12 All right. Commissioners? Commissioner 13 Epps? 14 COMMISSIONER EPPS: Okay. Chair, if you 15 would, a few remarks. 16 The Division asserts in its exceptions 17 that the decision in the instant matter somehow 18 runs afoul of the decisions in both the 19 previously considered applications. Having 20 reviewed both of those decisions, as well as 21 the record in the instant matter, I have to 22 disagree. In the first application, the 23 hearing examiner concluded that Jospeh N. 24 Merlino's connection to his father, Lawrence 25 Merlino, could place the Atlantic City casino 111 ITEM NO. 13 1 industry at risk. This conclusion was reached 2 based on Joseph N.'s admission that he had been 3 financially involved -- legitimately -- with 4 his father, having been employed by his father 5 for a short period of time and had sought out 6 his father's advice on certain work-related 7 matters. Although it was determined that 8 Lawrence Merlino had no involvement in Bayshore 9 Rebar, Inc., the hearing examiner found that 10 given Joseph N.'s willingness to discuss 11 work-related matters with his father, who was a 12 known LCN organized crime figure, and given his 13 father's financial support, even if legitimate, 14 Joseph N. could intentionally or 15 unintentionally place the Atlantic City casino 16 isdustry at risk of being infiltrated by 17 organized crime. 18 On the second application, the hearing 19 examiner concluded that Applicants were 20 disqualified based primarily on applicants' 21 offer of a job to Joseph S. "Skinney Joey" 22 Merlino. The hearing officer also found as the 23 attendance by Applicants at certain family 24 functions where LCN organized crime figures 25 were expected were voluntary, knowing, and 112 ITEM NO. 13 1 avoidable inimical conduct -- contact. As the 2 Division correctly states, the hearing examiner 3 stated outright that an applicant or licensee 4 must be expected to take reasonable 5 precautionary measures to distance oneself from 6 a known career offender if he reasonably 7 expectes to be permited to participate in this 8 intensely regulated and extremely sensitive 9 industry. 10 The hearing examiner found that 11 Applicants' job offer to Joey S. "Skinny Joey" 12 Merlino was inimical in that Applicants were 13 aware of this nefarious reputation and yet 14 nonetheless offered him a job. The hearing 15 examiner also found Applicants incredible in 16 their explanation of why they offered him a 17 job. Given the totality of the circumstances, 18 the hearing examiner concluded that Applicants 19 had inimical associations and, for that reason, 20 were disqualified from licensure. 21 Having reviewed the record in the 22 instant matter, I see nothing that corroborates 23 the Division's assertion that the most recent 24 decision overturns the findings made in the 25 previous two matters. The standard remains the 113 ITEM NO. 13 1 same. Applicants must demonstrate their 2 qualifications for licensure by clear and 3 convincing evidence. Just because applicants 4 were denied two previous applications does not 5 justify an automatic denial of the third. 6 It bears noting that in both of the 7 previous applications from the time Applicants 8 filed the application until the hearing was 9 concluded, no more than three years had elapsed 10 from the alleged conduct to the decision. In 11 the instant matter, more than ten years elapsed 12 since the Applicants last voluntary interaction 13 with a known LCN organized crime figure and the 14 beginning of the hearing. And while the 15 Division appears confident in its determination 16 that Anthony F. Giraldi is a known LCN 17 organized crime figure, the record reflects 18 that if he is, in fact, such a figure, he's 19 known only to the Philadelphia Police 20 Department, and certainly not to the Applicants 21 as such. 22 Our system of justice requires the trier 23 of fact to review and assess all of the 24 evidence presented before them and place 25 whatever weight that trier of fact believes 114 ITEM NO. 13 1 each piece of evidence deserves. Simply 2 because a trier ever fact reaches a conclusion 3 that fails to comport with one's expectations 4 does not suggest that that trier of fact is 5 incompetent, biased, or somehow failed to 6 appreciate the nuances in the evidence. 7 Applicants are entitled to a fresh look 8 based on the current record. The period of 9 automatic disqualification has been complete. 10 And given the reality that Applicants would 11 have had no reason to suspect Anthony F. 12 Giraldi as an LCN organized crime crime figure, 13 their interaction with him must be viewed in 14 accordance with the standards elucidated in the 15 Commission's previous decision, including 16 Baldino and Staluppi. 17 After taking a fresh look at the current 18 record, I concur with the hearing examiner that 19 the Division's evidence was stale and credibly 20 refuted and reject the Division's argument 21 that, if adopted, the findings of fact and 22 conclusions of law in Commissioner Sommeling's 23 initial decision fly in the face of findings of 24 the previous two matters. 25 As the initial decision points out, the 115 ITEM NO. 13 1 Division's evidence, which purports to 2 clarify -- classify Anthony F. Giraldi as an 3 associate of the Philadelphia LCN organized 4 crime family is incomplete at best. Some of 5 the surveillance reports placed Anthony F. 6 Giraldi is the presence of certain other known 7 LCN organized crime figures. However, the 8 Division presented no evidence from any other 9 law enforcement agencies to corroborate this 10 designation. While Applicants produce multiple 11 former law enforcement persons, none of which 12 whom had ever heard of Anthony F. Giraldi, in 13 addition, Applicants' witnesses testify that, 14 one, telltale signs that would tend to indicate 15 that a person is an LCN crime figure were 16 missing, leaving the Division's assertions 17 about Anthony F. Giraldi's alleged LCN business 18 activities unsubstantiated. 19 The Division attempts to downplay the 20 import of the Applicants' witnesses merely 21 because of their retirement from the law 22 enforcement community prior to the filing of 23 the instant application. What the Division 24 fails to acknowledge, however, is that these 25 witnesses were and are trained in various law 116 ITEM NO. 13 1 enforcement techniques, particularly with 2 respect to Philadelphia LCN families' organized 3 crime activities. Just because they're retired 4 does not mean they've lost the ability to 5 critically analyze the information presented by 6 the Division. And while the record reflects 7 that the Division has repeatedly argue that 8 their retirements prevent them from being able 9 to talk to current law enforcement persons to 10 confirm what they know, the record also 11 reflects that the Division apparently only 12 spoke with the Philadelphia Police Department 13 whose only real contribution was to provide 14 dated surveillance reports about which no one 15 could testify to having any first-hand 16 knowledge. None of the Division's witnesses 17 were aware of Anthony F. Giraldi or his status, 18 if any, within the Philadelphia LCN organized 19 crime family. Rather, Anthony F. Giraldi's 20 name is scattered throughout a handful of 21 documents without any credible corroboration to 22 his alleged status or why he should be believed 23 to have such a status. To accept the 24 Division's assertions as to Anthony F. Giraldi 25 based on the record before us would be to 117 ITEM NO. 13 1 disregard the fundamental principles of 2 justice. Importantly, despite all of the 3 discussions surrounding Anthony F. Giraldi's 4 alleged status within the Philadelphia 5 organized crime family, it is not Anthony F. 6 Giraldi who is seeking a license. Accordingly, 7 the question before the hearing examiner and 8 now before us, the Commission, is not whether 9 Anthony F. Giraldi is an associate of LCN, 10 organized crime. Rather the question is 11 whether Applicants are disqualified from 12 licensure because of any inimical associations, 13 be they with Anthony F. Giraldi or some other 14 LCN organized crime figure. In determining 15 what qualifies as an inimical association, we 16 look to Commission precedent for guidance. 17 That precedent specifically cautions against 18 finding inimical association, especially when 19 the applicant has no knowledge of the alleged 20 reputation of the LCN orgaznized figure. In 21 that vein, the nature, quality, and scope of 22 the association is to be evaluated. 23 Anthony F. Giraldi grew up in a 24 neighborhood that produced a significant number 25 of LCN crime figures. He still lives in that 118 ITEM NO. 13 1 neighborhood. His willingness to be seen with 2 certain persons does not necessarily indicate 3 that he is an LCN organized crime figure. And 4 the proof of that is reflected in the 5 Division's position with respect to the 6 Applicants. They clearly have been seen over 7 the years in the presence of LCN crime figures. 8 They've even been captured during a handful of 9 surveillances and subsequent noted in the 10 corresponding surveillance reports. But even 11 the Division acknowledged that they are not 12 believed to have any personal involvement in 13 the Philadelphia LCN orgazized family. 14 Furthermore, there was no evidence 15 presented that demonstrated that the FBI or the 16 Philadelphia Police Department or the New 17 Jersey State Police or any other law 18 enforcement organization considers the 19 Applicants to be LCN, organized crime figures. 20 With this in mind, it seems obvious, then, that 21 the mere mention of Anthony F. Giraldi in a 22 limited sampling of surveillance reports is 23 insignificant to demonstrate that he's actively 24 involved in LCN activities. 25 Without credible corroborating evidence, 119 ITEM NO. 13 1 such a conclusion based solely on the 2 surveillance reports is suspect. 3 Furthermore, the surveillance reports 4 provided by Mr. Kuras do not corroborate the 5 Division's assertions as to Anthony F. 6 Giraldi's alleged LCN organized crime status. 7 In fact, Mr. Kuras' testimony demonstrated that 8 if Anthony F. Giraldi is, in fact, an LCN 9 organized crime figure, his status is known 10 only to the Philadelphia Police Department. 11 Similarly, the Division's insistance 12 that, if adopted, the initial decision will 13 require the Division to provide wiretap 14 conversations in order to meet its burden of 15 prove is disengenuous. Nowhere in the initial 16 decision does it state that the decision to 17 obtain wiretaps was fatal to the Division's 18 position. That's not true. What was fatal to 19 the Division's position was the combined weight 20 of the evidence and Applicants' evidence. 21 Given the hearing examiner's credibility 22 findings, simply producing telephone records or 23 charts of telephone records does not 24 demonstrate an inimical association. 25 Furthermore, Applicant's credibility explained 120 ITEM NO. 13 1 the majority of the phone calls, some of which 2 were nearly 13 years old. If the Division 3 intends to overcome Applicants' credible 4 evidence, it needs to produce more than dated 5 telephone records. 6 Each matter before the Commission is 7 reviewed on a case-by-case basis. In this 8 case, the Division did not prove meet its 9 burden of proof, and no amount of speculation 10 can overcome this failure. 11 Finally, the notion that the Division 12 shifts the standard is unsupportable. My 13 review of the record in this matter leads me to 14 conclude that the governing standard which 15 requires the trier of fact to consider the 16 nature, scope, and quality of any association 17 remains in place. The Division's proofs simply 18 do not provide a basis upon which to reach the 19 conclusion that the Division demands that we 20 reach. 21 Based on the evidence presented in the 22 instant matter, and having reviewed the record 23 and having read the initial decision, I'm 24 comfortable with the hearing examiner's 25 findings of facts and conclusions of law that 121 ITEM NO. 13 1 the Division's allegations were based on mere 2 suspicion and that the Division failed to 3 demonstrate that Applicants had or have 4 inimical associations which would warrant 5 disqualification. 6 Accordingly, I move that we adopt the 7 initial decision and find Joseph N. Merlino and 8 Phyllis A. Merlino qualified and grant a 9 nongaming CSI license to Bayshore Rebar, Inc. 10 CHAIR KASSEKERT: Is there a second? 11 Commissioner Harrington? 12 VICE CHAIR HARRINGTON: Yes. 13 First let me say I have the utmost 14 regard for the Division of Gaming Enforcement 15 and for the role that they play in assuring 16 that gaming in New Jersey is held to the 17 highest standards. I also appreciate that the 18 legislature understood exactly what it was 19 doing when the statute was crafted to have two 20 bodies, the Casino Control Commission and the 21 Division of Gaming Enforcement to provide the 22 necessary checks and balances in 23 decision-making as it applies to the casino 24 industry. 25 This hearing and the decision is based 122 ITEM NO. 13 1 on what was presented. And as I read -- and I 2 mean before the exceptions were filed, I read a 3 pattern of disrespect, disregard and defiance 4 in the process leading up to the August 5 hearing. 6 I and my fellow commissioners understand 7 our responsibility to up hold the high 8 standards and the thresholds of good character, 9 integrity, and honesty as it applies to all 10 associated with the casino industry in New 11 Jersey. It is my belief we meet the test of 12 assuring all licensees meet that standard. 13 One particular focus of the Division's 14 investigation was phone calls and phone 15 records. Mr. Rogacki made reference to a 16 matter we considered earlier today in which I 17 appreciated the diagram to help understand an 18 issue. And he indicated that the Division also 19 provided diagrams in describing phone calls, 20 especially as they relate to today's 21 consideration of the initial decision before 22 us. I concur with the decision's conclusion 23 that those records provide only speculation and 24 do not demonstrate inimical associations that 25 threaten Atlantic City's gaming operations. 123 ITEM NO. 13 1 Furthermore, the challenge that going 2 forward that a wiretap would be the only way to 3 affirm relationships, as Commissioner Epps 4 noted, that is not necessarily the case, and no 5 new standard is being set here. I note, in 6 fact, that in this case, the record is clear 7 that there were attempts to have a wiretap 8 authorized, but repeatedly those wiretap 9 requests were not justified and were denied. 10 It seems if they were found to be justified, 11 the Division would have been happy with that 12 decision. 13 Every other week, we make decisions on 14 licensees, we did earlier today, who have been 15 rehabilitated or who have changed their 16 behavior. I am persuaded that today's decision 17 is evidence of an application for licensure 18 which is very different than the two previous 19 attempts and which clearly demonstrates an 20 Applicant who has made such changes. 21 As such, I am voting to support this 22 decision and will second this motion. 23 CHAIR KASSEKERT: Thank you. 24 I accept the motion to adopt and the 25 second. 124 ITEM NO. 13 1 Before we vote on the motion, I feel 2 compelled to make the following comments: As 3 the initial decision made clear, the Division 4 failed to meet its burden of proof in this 5 matter. And, after reviewing the evidence and 6 reading the initial decision, I was shocked to 7 see the Division's exceptions. The Division 8 has taken the unprecedented step of attacking 9 not just the findings and facts and conclusions 10 of law, but the character and integrity of 11 nearly everyone who appeared to reject the 12 Division's posturing. 13 The Division's personal attack on the 14 hearing examiner, Commissioner Sommeling, who 15 served this Commission honorably for ten years 16 and prior to joining the Commission enjoyed a 17 lengthy and distinguished career in law 18 enforcement was unwarranted and extremely 19 unprofessional. 20 The Division has characterized itself as 21 a helpless victim, but my review of the record 22 reveals nothing can be further from the truth. 23 And while the Division asserts that the intial 24 decision is replete with distortions of 25 testimony and proven facts and selective 125 ITEM NO. 13 1 omissions of critical facts and testimony, my 2 review of the record and the decision reveals 3 otherwise. 4 Applicants are required to demonstrate 5 their qualifications, including their good 6 character, honesty, and integrity by clear and 7 convincing evidence. But the Division has the 8 burden of demonstrating by a preponderance of 9 the evidence that the applicants are 10 disqualified from nongaming CSI licensure. 11 The Division claimed Applicants are 12 disqualified due to an inimical association. 13 The Division attempted to demonstrate that the 14 Applicants had an inimical association with LCN 15 organized crime figures and, in particular, 16 with Anthony F. Giraldi. In order for the 17 association to be inimical, either Applicants 18 or someone they interacted with would need to 19 be involved with the LCN organized crime. 20 Furthermore, the relationship between 21 Applicants and any person involved with LCN 22 organized crime must be adverse to the public 23 confidence and trust in the credibility, 24 integrity, and stability of casino gaming 25 operations. 126 ITEM NO. 13 1 As Applicants are clearly not personally 2 involved with LCN organized crime activities, 3 the Division had to prove by a preponderance of 4 the evidence that someone Applicants interacted 5 with was involved with such activity. And to 6 justify a finding of inimicability, the 7 Division would also have to prove by a 8 preponderance of the evidence that any 9 interaction was of such a nature that it would 10 threaten the public confidence and the trust 11 and the credibility and integrity and stability 12 of casino gaming operations. 13 In attempting to demonstrate an inimical 14 association, the Division presented two primary 15 sources of evidence. The first was a 16 surveillance report, the second was the 17 telephone records. The surveillance reports 18 place either Applicants or Anthony F. Giraldi 19 in the presence of LCN organized crime figures. 20 The Division argues the reports themselves are 21 demonstrative of an inimical association. But 22 the last credible report that placed Applicants 23 in the presence of LCN organized crime figures 24 was from July of 1999. By no means should the 25 hearing officer ignore the significance of this 127 ITEM NO. 13 1 report. However, he also could not ignore the 2 fact that more than ten years had passed since 3 Applicants physically interacted with these 4 figures. 5 Curiously for all the Division's 6 insistance that Anthony F. Giraldi is a active 7 and well-known figure in the Philadelphia LCN 8 organized crime figure, the last surveillance 9 that placed him in the presence of other known 10 LCN organized crime figures was in early 2004. 11 Prior to that, the most recent surveillance 12 placing Anthony F. Giraldi in the presence of 13 Philadelphia LCN organized crime figures was in 14 October of 2000. Applicants were not seen 15 during either surveillance because they were 16 not there. 17 Furthermore, the Division's own witness, 18 Sgt. McCullough, testified that the 19 surveillance reports that are utilized to 20 record who was -- testified the surveillance 21 reports are utilized to record who was there 22 and when they were there. He also testified 23 that the mere mentioning of someone's name in 24 such a report, even on multiple occasions, does 25 not automatically render that person an 128 ITEM NO. 13 1 associate of organized crime and confirmed that 2 despite his status as a supervisor of his unit, 3 he had never heard of Anthony F. Giraldi and 4 had no knowledge as to whether Anthony F. 5 Giraldi had certain status within the 6 Philadelphia organized crime family, the LCN, 7 even after having more than a year to 8 investigate the claim after the Division 9 contacted his unit. 10 Similarly, as the hearing officer 11 discussed, the most recent surveillance of 12 Anthony F. Giraldi's mother's viewing does not 13 aid in determining whether he has status within 14 LCN organized crime, especially in the light of 15 the designate as Joseph N. as an associate, an 16 associate even the Division has acknowledges is 17 improper. 18 From my review of the record, the 19 hearing officer properly discounted the 20 Division's evidence in light of the Applicants' 21 evidence. While the Division refers to 22 Applicants' witnesses as mercenaries and 23 attempts to undermine the import of their 24 testimony, the hearing examiner clearly 25 determined their testimony was credible, 129 ITEM NO. 13 1 relevant, and reliable. And despite the 2 Division's rhetoric otherwise, one's status as 3 a universally satisfactorily recognized LCN 4 organized crime figure is highly relevant to a 5 finding of inimicality. As the Division 6 clearly stated in Staluppi, the nature, 7 quality, and scope of the association must be 8 evaluated to consider such factors as the time 9 of the association, its duration, its purpose, 10 its intensity, its attenuation to third 11 parties, the character of the associate, the 12 associate's reputation, the applicant's 13 knowledge of such reputation or character, the 14 applicant's exercise of reasonable efforts to 15 determine the suitability of its associates, 16 termination of the association, and reasons for 17 termination. 18 Clearly, the hearing examiner, evaluated 19 the nature, quality, and scope of Applicants' 20 associations and found that the length of time 21 since a knowing interaction occurred combined 22 with Applicants' general attempts to sever any 23 known associations were sufficient when viewed 24 in connection with other credible evidence to 25 warrant a finding that Applicants had clearly 130 ITEM NO. 13 1 and convincingly demonstrated their 2 qualifications for licensure. 3 Likewise, I concur that the telephone 4 records do not demonstrate an inimical 5 association. The Division asserts that the 6 hearing examiner sent a message to the world 7 that as long as a telephone conversation is not 8 recorded, disqualification cannot be proved. 9 But the Division's assertion is disingenuous. 10 The hearing examiner did not unjustifibly 11 reject the Division's claims about the import 12 of the telephone records. He rejected them 13 because Applicants were able to clearly and 14 convincingly through credible and persuasive 15 evidence demonstrate the Division's claims as 16 to the importance of the telephone records and 17 what they allegedly proved were based on mere 18 speculation. 19 The Division argued the proof of Anthony 20 F. Giraldi's alleged LCN organized crime status 21 could be found in the results of its 22 investigation which led the Division to 23 conclude that Anthony F. Girardi's father's 24 plumbing business is nothing but a mere front 25 for the LCN organized crime activity. 131 ITEM NO. 13 1 Applicant's credibly demonstrated otherwise. 2 The Division's only response to the hearing 3 examiner's rejection of its claims was to 4 arrogantly claim in its exceptions that anyone 5 with a printer can print out business invoices 6 and business cards and city licenses. But 7 outside the Division's mere posturing, there's 8 nothing in the record that would warrant 9 discounting Applicants' credible evidence in 10 favor of the Division's mere speculation. 11 Credibility was integral to the findings 12 of fact in the instant matter. The record 13 reflects that at nearly every turn Applicants 14 credibly refuted the Division's unsubstantiated 15 claims. When the Division alleged that Anthony 16 F. Giraldi had been to visit Joseph S. "Skinny 17 Joey" Merlino in prison, Applicants conducted a 18 thorough investigation to conclusively 19 demonstrate that this was not true. When the 20 Division's alleged that the plumbing business 21 was nothing but a mere front, Applicants 22 presented concrete evidence convincingly 23 demonstrating otherwise. Adamant that the 24 Division's accusation -- that Joseph N. had 25 spent tens of thousands of dollars at one time 132 ITEM NO. 13 1 of slot play in the Atlantic City casinos was 2 inaccurate. Applicants produced printouts of 3 his slot play that clearly showed that the 4 Division's accusations were groundless. When 5 the Division assumed that Applicants were 6 involved in every telephone call, Applicant's 7 presented credible witnesses that testified 8 otherwise. 9 To the extent Applicants once interacted 10 with questionable persons or person -- person 11 or persons who themselves interacted with 12 questionable persons, the hearing officer found 13 that Applicants had divorced themselves from 14 those people. The fact that the Division does 15 not like the time line in which Applicants 16 effecuated this divorce does not warrant a 17 rejection of the initial decision. So sincere 18 are Applicants on demonstrating their 19 qualifications for licensure, that Phyllis 20 severed her relationship with Lauren Belcastro 21 merely because Lauren was tied to Martin 22 "Marty" Angelina. That severance occurred no 23 later than January of 2003. And based solely 24 on the Division's mere speculation in its 25 letter report, which I've already mentioned was 133 ITEM NO. 13 1 in some instances later proven false, Joseph N. 2 severed his relationship with Anthony F. 3 Giraldi. And both Phyllis and Joseph N. have 4 demonstrated their intention to follow through 5 on keeping these relationships severed so as 6 long as there is even an appearance that such 7 relationships could reflect poorly on the 8 Applicants. 9 Similarly, while the Division chides the 10 hearing officer's brief discussion and limited 11 finding of fact to events that happened prior 12 to March of 1997, the record clearly reflects 13 that the Division spent significant time 14 discussing the same events. In fact, just this 15 morning, the Division insisted that if the 16 Commission adopts the initial decision it will 17 "change the baseline standards for all future 18 organized crime" matters without regard to any 19 prior history. This type of disparity ran 20 throughout the hearing with the Division 21 asserting repeatedly that to reject its claims 22 is akin to authorizing the downfall of the 23 Atlantic City casino industry. 24 In its exceptions, the Division asserts 25 that the hearing examiner is incompetent for 134 ITEM NO. 13 1 allegedly failing to recognize in the initial 2 decision that Applicants did not utilize any 3 documents the Division turned over pursuant to 4 the hearing officers discovery orders. 5 Ironically, the Division points no rule, 6 statutes, regulation, or other case law that 7 requires a party to offer during a hearing that 8 all discovery is obtained. Clearly the 9 Division is so focused on attempting to conjure 10 up a demonstration of prejudice against itself 11 that it fails to recognize that its own proofs 12 are woefully lacking. 13 Having reviewed the record in this 14 matter, I conclude with the hearing officer's 15 findings that the Applicants evidence was more 16 persuasive and credible than the Division's. I 17 will reiterate what the hearing officer 18 eloquently wrote in his initial decision. The 19 job of the Commission is to act as the fact 20 finder of the truth, not to punish. It will 21 not be intimidated. Clearly the legislature I 22 intended for applicants previously found 23 disequalified such as Bayshore to have the 24 opportunity to reapply for licensure after the 25 mandatory disqualification period and to 135 ITEM NO. 13 1 receive a fair and objective review of the new 2 application. If it did not, the Act would have 3 required that a disqualified finding be 4 permanent. It would not provide for subsequent 5 applications for proof of rehabilitation. 6 The hearing officer -- the hearing 7 examiner aptly performed the quasi-judicial 8 statutory task assigned to him and 9 appropriately applied the statutory and 10 decisional law to the facts. The Commission 11 is here to ensure the integrity of the Atlantic 12 City casino industry, and I am satisfied that 13 the hearing officer's thoughtful analysis of 14 the record does just that. 15 We have a motion and a second. All 16 those in favor? 17 (Ayes.) 18 CHAIR KASSEKERT: Opposed? 19 (No response.) 20 CHAIR KASSEKERT: Motion carries. 21 Thank you. 22 MR. DONNELLY: Thank you very much. 23 MR. NANCE: In accordance with 24 Resolution No. 09-12-16-20, the next closed 25 session of the Commission shall be held on 136 1 Wednesday, May 19th, 2010, at 9:15 a.m. in the 2 Commission offices. 3 It is now time for the public 4 participation portion of the meeting. 5 CHAIR KASSEKERT: Is there anyone from 6 the public that wishes to be heard? 7 (No response.) 8 CHAIR KASSEKERT: Seeing no one, I'll 9 declare this portion of the meeting closed and 10 entertain a motion to adjourn. 11 COMMISSIONER SOMMELING: Motion to 12 adjourn. 13 CHAIR KASSEKERT: Is there a second? 14 VICE CHAIR HARRINGTON: Second. 15 COMMISSIONER FANELLE: Second. 16 CHAIR KASSEKERT: The motion has been 17 made and seconded. All in favor? 18 (Ayes.) 19 CHAIR KASSEKERT: Opposed? 20 (No response.) 21 CHAIR KASSEKERT: The motion carries. 22 Thank you. 23 (Public Meeting 10-05-05 was adjourned 24 at 3:52 p.m.) 25 137 1 2 C E R T I F I C A T E 3 4 5 I, DARLENE SILLITOE, a Certified Court 6 Reporter and Notary Public of the State of New 7 Jersey, certify that the foregoing is a true 8 and accurate transcript of the proceedings. 9 10 11 I further certify that I am neither 12 attorney, of counsel for, nor related to or 13 employed by any of the parties to the action; 14 further that I am not a relative or employee of 15 any attorney or counsel employed in this case; 16 nor am I financially interested in the action. 17 18 19 DARLENE SILLITOE CCR 20 License No XI01023 21 22 Dated: May 8, 2010 23 My Notary Commission Expires July 22, 2014 24 ID No 2062871 25