Bally’s initially offered a 25% stake in the project to only women and minority investors as part of the company’s bid to win the casino license from the city in 2022. It was part of a broader effort to create wealth among disenfranchised communities that historically don’t reap the benefits of Chicago’s biggest developments.
But shortly after Bally’s filed an initial offering with the US Securities and Exchange Commission in December, Richard Fisher and Phillip Aronoff filed suit, along with the conservative legal group American Alliance for Equal Rights. They claimed the city violated Fisher and Aronoff’s civil rights, arguing they were unable to purchase shares because they were White men.
“We are very happy with the resolution and Bally’s decision not to use race in this investment,” Dan Lennington, an attorney for the men and the AAER, said in a statement. “This case should serve as a warning to other companies that hope to dole out investment opportunities based on race. It is illegal and we’ll fight it wherever we can.”
Lennington declined to comment on whether Fisher and Aronoff had purchased any shares of the offering since it had been opened up to other investors.
Bally’s and the city of Chicago did not immediately respond to requests for comment. The suit also named the Illinois Gaming Board, which was represented through the Illinois Attorney General’s office, neither of which responded to requests for comment.
Diversity, equity and inclusion initiatives have been targeted by President Donald Trump during his second term, threatening to withhold federal funding and filing lawsuits claiming such programs are discriminatory. AAER says it focuses on DEI initiatives and “distinctions made on the basis of race and ethnicity.” The organization was founded by conservative legal activist Edward Blum.
In an April SEC filing, Bally’s said more lawsuits were possible and that they could threaten the project.
“The Host Community Agreement could be modified or terminated, which could adversely affect our ability to operate our casinos and could materially adversely affect our business, financial condition and results of operations,” Bally’s said in the filing.
The case is American Alliance for Equal Rights v. Chicago, 25-cv-01017, US District Court, Northern District of Illinois (Chicago).
