Stockton/Showboat Update…

But Judge Julio Mendez on Monday also gave KK Ventures and its president Glenn Straub time to show cause as to why the university should be held to its agreement to sell the site to Straub.

Stockton acting president Harvey Kesselman issued a statement called the order excellent news for Stockton.

“We can now move forward with a sale of the Showboat,” he said. “This will be in the best interest of the University and our students.”

Straub also said the ruling was a victory because it still gives him time to make his case and allows him to take action if Stockton does try to sell the site.

“They didn’t get what they wanted,” he said by phone Monday evening.

Stockton’s April 3 agreement to sell Showboat to Straub’s company for $26 million expired on July 2. Straub filed a complaint against Stockton July 1 claiming that the university had not done all it could to deal with deed restrictions on the site that both require it be used as a casino, and prohibit it from being used as a casino.

Straub asked the court to either make the original contract void, or extend it to allow more time for courts to deal with the title issue. Stockton, which bought the Showboat from Caesars Entertainment in December for $18 million, has filed a lawsuit against Caesars in bankruptcy court over the deed restrictions.

Stockton attorneys on Friday filed a complaint for relief against KK Ventures. Mendez held a hearing Monday on the issue.

Stockton is asking the judge to rule that the sales agreement with Straub be terminated on July 1, that Stockton holds title to the property unencumbered by any interest of KK Ventures, that Stockton is free to market the property without restriction, that KK Ventures cannot file any action to interfere with Stockton’s title or right to sell the property, and that Stockton be awarded attorneys fees and costs in accordance with the April 3 agreement.

The Order to Show Cause and Temporary Restraining Order filed Monday by Mendez prohibits KK Ventures from interfering with the University’s title to or right to convey the Showboat property. However if Stockton enters into an agreement for a sale, the university must provide notice to KK Ventures so that KK Ventures may move to dissolve the restraints.

Straub said he is still interested in the site and doesn’t just want his money back. The $26 million has been in escrow since April 3.

“There are a lot of things you can do with that property,” he said. “I’m trying to bring jobs and money into Atlantic City.”

The parties are scheduled to appear in court again Aug. 7.