[J-133-2016 and J-134-2016] [MO: Todd] 

IN THE SUPREME COURT OF PENNSYLVANIA 

EASTERN DISTRICT 

SUGARHOUSE HSP GAMING, L.P., : No. 124 EM 2016 

Petitioner 

v. 

PENNSYLVANIA GAMING CONTROL 

BOARD, 

: Appeal from the Supplemental 

: Adjudication of the Pennsylvania 

: Gaming Control Board in the matter of 

: the Applications for the Category 2 Slot 

: Machine License in the City of the First 

: Class, Philadelphia, dated June 23, 

: 2016 

: SUBMITTED: November 7, 2016 

Respondent 

STADIUM CASINO, LLC, 

Intervenor 

MARKET EAST ASSOCIATES, LP, : No. 125 EM 2016 

Petitioner : Appeal from the Supplemental 

: Adjudication of the Pennsylvania 

: Gaming Control Board in the matter of 

v. : the Applications for the Category 2 Slot 

: Machine License in the City of the First 

: Class, Philadelphia, dated June 23, 

PENNSYLVANIA GAMING CONTROL : 2016 

BOARD, 

: SUBMITTED: November 7, 2016 

Respondent 

STADIUM CASINO, LLC, 

Intervenor 

CONCURRING OPINION 

JUSTICE BAER DECIDED: June 20, 2017 
I join the majority opinion in substantial part, but I write separately to distance 

myself from my colleagues' definition of "financial interest" for purposes of Section 1330 

of the Pennsylvania Race Horse Development and Gaming Act ("Gaming Act"), which 

prohibits a "slot machine licensee, its affiliate, intermediary, subsidiary or holding 

company" from "possess[ing] an ownership or financial interest that is greater than 

33.3% of another slot machine licensee" or other related entities. 4 Pa.C.S. § 1330.1 

14 Pa.C.S. § 1330, entitled "Multiple slot machine license prohibition," provides in full: 

No slot machine licensee, its affiliate, intermediary, 

subsidiary or holding company may possess an ownership 

or financial interest that is greater than 33.3% of another slot 

machine licensee or person eligible to apply for a Category 1 license, its affiliate, intermediary, subsidiary or holding 

company. The board shall approve the terms and conditions 

of any divestiture under this section. Under no 

circumstances shall any such divestiture be approved by the 

board if the compensation for the divested interest in a 

person eligible to apply for a Category 1 license exceeds the 

greater of the original cost of the interest, the book value of 

the interest or an independently assessed value of the 

interest one month prior to the effective date of this part and, 

in the case of a person eligible to apply for a Category 1 license, unless the person acquiring the divested interest is 

required to continue conducting live racing at the location 

where live racing is currently being conducted in accordance 

with section 1303 (relating to additional Category 1 slot 

machine license requirements) and be approved for a 

Category 1 slot machine license. No such slot machine 

license applicant shall be issued a slot machine license until 

the applicant has completely divested its ownership or 

financial interest that is in excess of 33.3% in another slot 

machine licensee or person eligible to apply for a Category 1 license, its affiliate, intermediary, subsidiary or holding 

company. 

[J-133-2016 and J-134-2016] [MO: Todd] - 2 
Unlike the Majority Opinion, I view "financial interest" broadly to encompass ownership 

interests. See Maj. Op. at 35 n.31. 

As the Majority and the parties have observed, "financial interest" is not defined 

in Section 1330. The term, however, is defined in Sections 1201 and 1512. While I agree that the definitions in Section 1201 and 1512 are limited to those specific 

sections, I find guidance in the definitions which substantially overlap with each other 

and conform to a common understanding of the term "financial interest." 

Section 1201 provides various restrictions on those who may serve on the 

Gaming Control Board, including limiting a board member's "financial interest" in an 

applicant or licensed facility. It defines "financial interest" as "[a]n ownership, property, 

leasehold or other beneficial interest in an entity." 4 Pa.C.S. § 1201(n).2 It further 

2 4 Pa.C.S. § 1201, entitled "Pennsylvania Gaming Control Board established," 

provides in relevant part: 

(continued...) 

(n) Definitions. - As used in this section, the following words 

and phrases shall have the meanings given to them in this 

subsection: 

"Financial interest." An ownership, property, leasehold or 

other beneficial interest in an entity. The term shall not 

include an interest which is held or deemed to be held in any 

of the following: 

(1) Securities that are held in a pension plan, profit-sharing 

plan, individual retirement account, tax-sheltered annuity, a 

plan established pursuant to section 457 of the Internal 

Revenue Code of 1986 (Public Law 99-514, 26 U.S.C. § 1 et 

seq.), or any successor provision, deferred compensation 

plan whether qualified or not qualified under the Internal 

Revenue Code of 1986, or any successor provision, or other 

retirement plan that: 

(i) is not self -directed by the individual; and 

[J-133-2016 and J-134-2016] [MO: Todd] - 3 
explains that an "ownership interest," for purposes of the term's inclusion in financial 

interest, encompasses "[o]wning or holding, or being deemed to hold, debt or equity 

securities or other ownership interest or profit interest." Id. The subsection additionally 

excludes from the term "financial interest" three categories of passive holdings, 

including pension plans and individual retirement accounts, Section 529 tuition plans, 

and mutual funds which are not self -directed. Notably, the Board adopted this definition 

nearly verbatim in its regulation relevant to the Board's operations and organization. 58 

Pa. Code § 403a.1. 

Similarly, Section 1512 limits certain government -affiliated individuals from 

having a financial interest in licensees or certain related entities. The section defines 

"financial interest" in very similar terms to Section 1201's definition.3 As in Section 

(... continued) 

(ii) is advised by an independent investment adviser who has 

sole authority to make investment decisions with respect to 

contributions made by the individual to these plans. 

(2) A tuition account plan organized and operated pursuant 

to section 529 of the Internal Revenue Code of 1986 (Public 

Law 99-514, 26 U.S.C. § 529) that is not self -directed by the 

individual. 

(3) A mutual fund where the interest owned by the mutual 

fund in a licensed entity does not constitute a controlling 

interest as defined in this part. 

"Ownership interest." Owning or holding, or being deemed to 

hold, debt or equity securities or other ownership interest or 

profit interest. 

3 4 Pa.C.S. § 1512(b), entitled "Financial and employment interests," defines "financial 

interest" for purposes of the section as follows: 

"Financial interest." Owning or holding, or being deemed to 

hold, debt or equity securities or other ownership interest or 

(continued...) 

[J-133-2016 and J-134-2016] [MO: Todd] - 4 
1201, financial interest for purposes of Section 1512 includes "[o]wning or holding, or 

being deemed to hold, debt or equity securities or other ownership interest or profits 

(... continued) 

profits interest. A financial interest shall not include any debt 

or equity security, or other ownership interest or profits 

interest, which is held or deemed to be held in any of the 

following: 

(1) A blind trust over which the executive -level public 

employee, public official, party officer or immediate family 

member thereof may not exercise any managerial control or 

receive income during the tenure of office and the period 

under subsection (a). The provisions of this paragraph shall 

apply only to blind trusts established prior to the effective 

date of this paragraph. 

(2) Securities that are held in a pension plan, profit-sharing 

plan, individual retirement account, tax-sheltered annuity, a 

plan established pursuant to section 457 of the Internal 

Revenue Code of 1986 (Public Law 99-514, 26 U.S.C. § 1 et 

seq.) or any successor provision deferred compensation 

plan whether qualified or not qualified under the Internal 

Revenue Code of 1986 or any successor provision or other 

retirement plan that: 

(i) is not self -directed by the individual; and 

(ii) is advised by an independent investment adviser who has 

sole authority to make investment decisions with respect to 

contributions made by the individual to these plans. 

(3) A tuition account plan organized and operated pursuant 

to section 529 of the Internal Revenue Code of 1986 (Public 

Law 99-514, 26 U.S.C. § 529) that is not self -directed by the 

individual. 

(4) A mutual fund where the interest owned by the mutual 

fund in a licensed entity does not constitute a controlling 

interest as defined in this part. 

[J-133-2016 and J-134-2016] [MO: Todd] - 5 
interest," and excludes the same three categories of passive holdings. In addition to the 

exclusions allowed for Board Members, Section 1512 provides that the various 

government -affiliated individuals may also hold interest in assets held in a blind trust. 

The definition of financial interest in Section 1512 does not specifically include Section 

1201's incorporation of "property, leasehold or other beneficial interest in an entity." 4 

Pa.C.S. § 1512 "Financial Interest" (1). Therefore, Section 1201's definition of "financial 

interest" is arguably broader than Section 1512. Understandably, the Gaming Act is 

more restrictive in regard to the financial holdings of Gaming Control Board members 

under Section 1201 than the broader category of governmental -affiliated individuals 

governed by Section 1512. 

While the General Assembly did not specifically apply either of these definitions 

to Section 1330's prohibition against a licensee or related entity holding a financial 

interest greater than 33.3% in another slot machine licensee or related entity, I nonetheless find the definitions useful in considering the term's meaning in regard to 

Section 1330, particularly because the definitions conform to the "common and 

approved usage" of the term "financial interest" as required by our rules of statutory 

construction. 1 Pa.C.S. § 1903(a). Under both definitions, "financial interest" includes 

ownership interest, which is defined to encompass the holding of debt or equity 

securities and a profit interest. Likewise, the definitions exclude various passive 

holdings that are not subject to the direction of the individual. 

To the extent that the definitions of financial interest in Sections 1201 and 1512 

differ, I would adopt the more expansive definition for purposes of Section 1330 to 

satisfy the stated legislative intent "to prevent possible monopolization by establishing 

reasonable restrictions on the control of multiple licensed gaming facilities in this 

Commonwealth." 4 Pa.C.S. § 1102(5). Thus, while specified government -affiliated 

[J-133-2016 and J-134-2016] [MO: Todd] - 6 
individuals may hold interest in licensees in a blind trust under Section 1512, blind trusts 

should not be excluded from the term "financial interest" for a licensee or other entity 

governed by Section 1330 as is the case with Gaming Control Board members under 

Section 1201. Additionally, the term under Section 1330 should also include "property, 

leasehold or other beneficial interest in an entity" as included in Section 1201, but not 

specifically stated in Section 1512. 

I respectfully reject the suggestion that "financial interest" does not include 

ownership interest. It is beyond cavil that an owner of a casino has a financial interest 

in the casino, regardless of how a dictionary defines "financial." Moreover, the General 

Assembly has repeatedly defined financial interest in the Gaming Act to include 

ownership interest. In my view, the use of the disjunctive "or" in the phrase "ownership 

or financial interest" should not be read to require careful delineation of interests as 

either ownership or financial, which presents the possibility that an "interest" might not 

fall neatly into either category. Instead, the phrase "ownership or financial interest" 

should be viewed as a complete phrase, which includes ownership as one form of the 

broader category of financial interests in order to implement the legislative intent to 

prevent monopolization. Additionally, I agree with the Board that the ownership or 

financial interest must be quantifiable in order for the Board to determine if the 33.3 

percent statutory threshold is reached. 

Viewing the term "ownership or financial interest" broadly, I concur with the 

Majority Opinion that the term includes loans, which, based upon their structure or 

significance, may provide the lender with an interest in or claim upon the borrower 

relevant to the General Assembly's intent to "prevent possible monopolization." 4 

Pa.C.S. § 1102. However, I question the Majority's reliance on the term "debt or equity 

securities" as used in 4 Pa.C.S. § 1311, as well as Sections 1201 and 1512, to 

[J-133-2016 and J-134-2016] [MO: Todd] - 7 
encompass loans within the phrase "financial interest" when the term "debt securities" is 

commonly used to reference bonds rather than loans generally. Additionally, I emphasize Market East's observation that the inclusion of loans in Section 1330's 

"ownership or financial interest" would not generally relate to large commercial lenders 

so long as they are not a "slot machine licensee, its affiliate, intermediary, subsidiary or 

holding company." 4 Pa.C.S. § 1330. 

While I differ in my view of "ownership or financial interest," I nevertheless join 

the Majority Opinion's remand for reconsideration of Mr. Manoukian's interest in 

Stadium Casino L.L.C., including his interest in Sterling Investors Trust. 

[J-133-2016 and J-134-2016] [MO: Todd] - 8