Bingo Adversaries Settle for $2.66 Million : Barona Indians, Former Game Operator Also Agree to Drop Lawsuits

Both sides in a dispute that closed the Barona Indian bingo palace for two years have agreed to drop all lawsuits against each other as part of a $2.66-million settlement approved Wednesday in federal Bankruptcy Court.

Under the agreement negotiated over the past month and a half, the Barona Tribal Council has agreed to pay $1.6 million to American Management and Amusement over 15 years in compensation for the bingo hall, which is north of Lakeside and is described as the “Taj Mahal of bingo.” Over the 15-year payment schedule, interest would bring the settlement to $2,658,000.

At Odds for Years

The two sides have been at legal loggerheads for several years over allegedly rigged bingo games and profit-skimming in the big-money bingo games.

But, because of the settlement, the $3-million Barona bingo palace, which seats 2,300 players, will open for the first time in more than two years at 6:30 p.m. Friday, offering a special Big 8 prize of $100,000 for any player who has eight of the first 20 numbers called in any of the games.

Indian reservations are federal lands and not subject to state laws, so bingo operators may disregard the $250 per game prize limit that state-licensed bingo operators must observe.

Art Bunce, lawyer for the Indians in litigation that has closed the hall since April, 1986, said the settlement is fair to both sides.

He said the alleged skimming scam and other improprieties led to a string of lawsuits between the Indian tribal council and AMA Inc. operators. One suit is now on appeal to the U.S. Supreme Court.

Stewart Siegel, a former AMA employee and general manager of the Barona bingo operations during its heyday, pleaded guilty in April, 1986, to rigging four bingo games with prizes totaling $94,500. He was sentenced to serve a year in County Jail and fined $500, but he has not yet served any time.

Both sides agreed to drop all lawsuits against the other as part of the settlement approved Wednesday by Bankruptcy Judge Louise de Carl Malugen and U.S. District Judge Howard B. Turrentine.

Monty McIntyre, attorney for the bankrupt AMA management company, called the settlement “historic” because it is the first time any Indian tribe has agreed to pay a bingo operator money to settle a case concerning the validity of a bingo contract under a federal law requiring approval of such contracts by the federal government. In other such disputes, he said, no such payments have been made.

‘Happy With Settlement’

“We are happy with the settlement,” McIntyre said, speaking for AMA officials, “but, of course we would have liked to have obtained the entire amount of our losses,” which he estimated at about $3.6 million.

Bunce said the settlement is fair “because both sides got what they needed.” AMA will recover funds to pay off its debtors, and the Barona Indians will get the chance to resume its larger bingo operation, he explained.

“I think that both sides would agree that both sides were victims of Mr. Siegel,” Bunce said.

Settlement of the lawsuits will mean at least 70 jobs for Barona Indian Reservation residents, Bunce said, “and I consider that one of the most important benefits.”

He said unemployment among the 300 or so Barona residents runs about 70%. The Indians have been conducting bingo games in a smaller building, attracting crowds of about 400, since December but need the larger hall to make the games profitable.

Bunce said that, in the first 30 months after the bingo palace opened in April, 1983, the games grossed $30,236,832--more than $1 million a month. The Tribal Council received only $565,678 of that amount, about 2% of the total take, “which seemed to us that something was amiss” under a contract that gave the Indians a 55% cut of the profits.

He said tribal leaders want to pay off the management company quicker than the 15-year schedule of payments to cut the interest.

“If the bingo games are as successful as we think they will be, we’ll be able pay it off early,” he said.

Don Thomason, general manager, and Medford Park, operations manager, were selected by the Barona leaders to run the operations. Both have been conducting the smaller bingo games at the reservation since December.

Park said Wednesday that the larger operation, which opens Friday, will employ about 150 people in full- and part-time jobs, with hiring preference given to reservation residents.

The new management, Bingo Enterprises, also has announced that it is resuming free bus service to the hall on routes serving about 2 million county residents, Park said.

Park said bingo will run seven days a week, with 800 to 1,000 players expected weekdays and 1,400 to 1,500 weekend nights.

McIntyre said the “lever” that allowed the two groups to reach agreement was the bingo palace, which remained closed under court order. The hall, he said, “is a necessary part of a successful bingo operation at Barona.”