Former Louisiana casino regulators receive state settlement

The state paid the settlement Friday to the former board members of the Louisiana Economic Development and Gaming Corp., which once regulated the casino project.

The settlement ends an effort to pry open records of the governor's transition office to determine if gambling interests paid any of his expenses between his November 1995 election and January 1996 inauguration.

State attorneys had opposed the request, saying the records had nothing to do with the LEDGC shutdown.

The attorney general's office and the governor's son, attorney Murphy J. Foster III, closed the LEDGC office in December 1995, a few weeks after Harrah's Jazz Co. shut down its temporary casino and filed for federal bankruptcy protection.

The board members' pay was cut off shortly afterwards and their benefits terminated, according to the suit.

Board members Max Chastain, James Vilas, Gilbert Lainez, Sallie Paige, Jack Frank and Fred Cassibry later filed a federal suit and two related state court actions, claiming that Murphy Foster and Assistant Attorney Generals Jack Yelverton and Jenifer Schaye acted in their official capacities to deny them their civil rights.

Cassibry died in 1996, but his estate continued pursuing the claim.

Schaye, who once headed the attorney general's gambling division, resigned from the attorney general's office on Jan. 21 after she was accused of giving misleading testimony in a video poker case and demoted.

Hillary Crain, chairman of the Louisiana Gaming Control Board, also was named as a defendant after he authorized partial payments to some, but not all board members.

Attorney Tom Barbera, who represented the LEDGC members, said all suits will be dismissed as a result of the settlement.

"This ends all litigation between these board members and any defendants associated with the case," said Barbera, who once served as assistant administrative officer of LEDGC.

The money was provided by the Legislature. In June, the governor's executive counsel, Cheney Joseph, told the Senate Finance Committee that "this is not something we like to do, but it is fiscally responsible."

Joseph said a trial would likely cost the state as much or more.

The suit had asked that the governor be forced to reveal financial records of his transition office to determine if gambling interests paid any of his expenses.

The governor initially promised to make public the donations for his transition activities, but later backed off, saying attorneys had advised the transition that donors who did not wish to be identified could sue for invasion of privacy.

Under the settlement, Chastain, who served as board chairman, will receive $97,500; Cassibry's estate will receive $159,500; Paige, Lainez and Vilas, $78,000 each; and Frank, $30,250. The settlement includes back pay, the value of benefits, and in Cassibry's case, a life insurance payment.

When Murphy Foster told the board members that their agency was being shut down, he said he was acting on behalf of his father, who had been elected but had not yet taken office.

At the time, Murphy Foster said the bankruptcy of the New Orleans casino left the agency with no operating funds. State law mandated that LEDGC's expenses be paid by a portion of casino operating funds.

Defense pleadings filed in the case said Murphy Foster, through the approval of his father and with the consent of Gov. Edwin Edwards, was "acting as a representative of the state."

A similar suit filed by LEDC's former chief administrative officer, Joseph Boucree Sr., is set for trial Sept. 21 in New Orleans federal court.

Boucree's attorney, Jack Sileo, said attempts to settle Boucree's claim failed. Schaye, Murphy Foster III and Yelverton also are defendants in that suit.

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