Magic Palace Casino Owners File $220 Million Lawsuit Against Kahnawake Council Over Shutdown

The co-owners of the closed Magic Palace casino in Montreal have initiated a $220 million lawsuit against the Mohawk Council of Kahnawake (MCK), claiming the tribal regulator wrongfully ended their gaming activities and violated their constitutional rights to due process. 

Central to the conflict is the council's choice to withdraw Magic Palace’s license in March 2024. This came after media reports claiming that the Royal Canadian Mounted Police (RCMP) was probing one of the casino’s foreign investors. 

In October 2023, La Presse stated that Luftar Hysa, originally from Albania, “launders money from Mexican traffickers and … utilizes a casino in Kahnawake for this purpose.” 

Hysa is under investigation in three nations for connections to Mexico’s Sinaloa cartel, which is among the most formidable and brutal drug-trafficking groups globally, according to court documents referenced by La Presse. 

The casino cut off connections with its main investor the following day, a decision that received accolades from MCK in a press statement. 

‘Unfounded, Militarized’ 

Casino operators Stanley Myiow and Barry Alfred assert in their lawsuit that the accusations were unfounded and used as a tool to rationalize an effort to tear down their business without proper hearing or substantial proof. 

The plaintiffs assert they were never given the opportunity to address the accusations. The lawsuit states that the casino's shutdown led to substantial monetary loss, including the cancellation of an intended expansion initiative. 

The total damages requested — $220.57 million — in a newly revised complaint comprises $155 million for the expansion and would constitute a significant part of the council’s most recent reported net financial assets. 

The plaintiffs claim that by revoking the license and swiftly terminating the royalty agreement, the MCK established a scenario that would prevent the Kahnawake Gaming Commission (KGC) from conducting a hearing. 

The lawsuit states that the termination essentially prevented the business from defending itself because the KGC needs an active royalty agreement to evaluate a case. 

This placed the plaintiffs in a “regulatory Catch-22” situation, as they were not allowed their “fundamental right to be heard,” according to the complaint. 

Claim of Conflict of Interest 

The lawsuit additionally asserts a conflict of interest regarding an active council member who did not withdraw from discussions or decisions related to Magic Palace, despite having connections to a rival gaming business, Playground Poker. 

“New evidence, including crucial admissions, now confirms what we had long known: that the MCK’s actions were based on false claims and a clear disregard for due process,” the plaintiffs asserted, as reported by The Eastern Door. “These revelations speak for themselves, are thoroughly detailed in public proceedings, and expose a pattern of abuse.”