Bally’s Chicago Casino Settles Anti-Diversity Federal Lawsuit

Chicago’s casino partner has cleared one lawsuit, but it faces a long road to opening day.

Bally’s Corporation and the City of Chicago settled a federal lawsuit brought by two white men and a conservative legal group over Bally’s offer of early ownership stakes in its $1.7 billion casino project exclusively to women and minority investors, Bloomberg reported.

Filed in January by plaintiffs Richard Fisher and Phillip Aronoff, along with the American Alliance for Equal Rights, the suit argued the city and developer discriminated on the basis of race and gender.

The parties reached a confidential settlement Friday, two months after Bally’s, under pressure from the Securities and Exchange Commission, revised the terms of its offering and opened up the equity sale to a broader pool of investors.

The initial share-sale plan, part of Bally’s 2022 bid to win the casino license, included a 25 percent set-aside for women- and minority-owned investors meant to align with Chicago’s goals for more equitable economic development. But following scrutiny from the Trump administration, which has targeted diversity-based funding programs, Bally’s dropped the demographic emphasis in April, opting instead to prioritize Illinois residents regardless of background.

Bally’s attorney declined to comment on whether the plaintiffs have since bought shares.

Bally’s Chicago casino project is navigating a turbulent rollout. In May, the Illinois Gaming Board lifted a stop-work order that had paused construction due to the use of an undisclosed contractor with alleged mob ties. Bally’s has since corrected the vendor oversight but remains under regulatory scrutiny.

After returning deposits earlier this year, Bally’s restructured its initial public offering, saying it would self-fund if necessary. Chairman Soo Kim said the company would still try to honor the spirit of the city’s equity goals but without “offending federal sensibilities.”

The future of Bally’s largest project is uncertain, plagued by credit downgrades and lower than expected revenue at the company’s temporary River North casino. The new casino is being built on the former site of the Chicago Tribune printing plant and is projected to open next year.

— Judah Duke