MGC “Parsing Words” Regarding Live Entertainment Gaming Statute

Massachusetts theaters have complained that Encore Boston Harbor is violating Massachusetts gaming laws related to live concerts. In response, the legal council of the Massachusetts Gaming Commission (MGC) reviewed the law, interpreting it in favor of the casino.

Encore is about to resume live concerts and entertainment for the first time since the onset of the pandemic.

What the gaming statute says about live entertainment at MA casinos

When gaming laws were put into place for Massachusetts casinos, lawmakers kept the little guys in mind. They wanted a safeguard in place for theaters that can’t compete with massive live concert halls at casinos.

Casinos give entertainers a massive payday to perform at their venues. Any losses incurred by the hefty performing fee are reclaimed when concert-goers become patrons on the casino floor.

According to the 2014 statute regarding applications for Massachusetts gaming licenses:

“A gaming licensee shall only be permitted to build a live entertainment venue that has less than 1,000 seats or more than 3,500 seats.”

How Encore allegedly violated the live entertainment statue

While Encore hasn’t built any live entertainment venues in the statute’s specified size, they’ve found a loophole in the law. The casino uses its Picasso Ballroom to host music and entertainment events with seating capacity in the taboo range.

Theaters surrounding the casino, including the Chevalier Theatre and the Hanover Theatre, have submitted official written testimonies to the MGC.

Testimonies allege that the following shows were held in the casino’s ballroom and sold between 1,000 and 3,500 seats:

• The B-52s, October 2019
• Straight No Chaser, December 2019
• Wayne Brady, January 2020
• Dropkick Murphys, March 2020

The complaining theaters have called for the MGC to issue fines and stop the casino’s practices.

MGC legal council says statute hasn’t technically been violated

The MGC appointed their legal counsel, Todd Grossman, to investigate and rule on the complaints against Encore Boston Harbor. Grossman provided his interpretation earlier this month and found no fault in the casino’s actions.

Grossman zeroed in on the word “build” when interpreting the Massachusetts gambling law. He suggested that since the casino didn’t build an actual live entertainment venue, they aren’t in violation of the law.

He further claims that the law doesn’t prohibit Massachusetts casinos from converting a meeting room or lounge into a space where tickets can be sold in numbers higher than 1,000.

“The hotel ballroom may be used for events that include live entertainment,” said Grossman. “There is no restriction in the agreement as to the size of any such event, either seats or patrons, the frequency of events, or any other such restrictions, though there could have been if it had been included in the agreement.”

Dan Rabinovitz is an attorney at Murphy & King. This is the law firm tasked in representing the booking agent for the Chevalier Theater and the city of Medford.

Rabinovitz argued that the casino did, in fact, “build” the ballroom in question. In light of this, he said, the casino shouldn’t be allowed to use the space for shows with the seat range in question.

Agreement may be damning for Encore Boston Harbor

Grossman calls to attention a separate agreement between Encore Boston Harbor and the Massachusetts Performing Arts Coalition. This agreement stands mandatory for the casino to get an operating license in the state.

He says the additional agreement further supports his interpretation in favor of the casino. The agreement states that all spaces in the casino are usable for events that “include live entertainment.”

Troy Siebels, CEO of Hanover Theater and Conservatory for the Performing Arts in Worcester, says Grossman gives a misleading summary of the additional agreement. Siebels negotiated the agreement with Encore.

“You have to read the whole thing,” he said.

Siebels also provided the full verbiage of the agreement in question. The agreement between the casino and the Coalition clearly prohibits a “temporary live entertainment venue.”

Siebels also addressed the portion of the agreement Grossman pointed out that allowed events to “include live entertainment.”

He says that portion of the agreement was intended for an event’s accompanying entertainment. It was not intended for an event selling thousands of tickets in the ballroom for the entertainment itself.

“It’s parsing words,” Siebels said. “And it’s clearly contrary to the spirit of the gaming statute.”

The MGC has not commented on this matter. Moreover, they indicate no intention of revisiting it after Grossman’s provided interpretation. It’s unlikely, however, that nearby theaters will give up the fight any time soon.