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Tuesday, October 21, 2014         

NEW YORK TIMES


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In Florida, gambling debate entangles Disney

By LIZETTE ALVAREZ and MICHAEL SNYDER

New York Times

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HALLANDALE BEACH, Fla. >> Just around the corner from the poker room and within shouting distance of the greyhound track here at the Mardi Gras Casino, the Amazing Spider-Man slot machine beckons gamblers with its spinning masked superhero and his nemesis the Green Goblin.

At the touch of a button, this Spider-Man can pay out fortunes or, more typically, deplete wallets.
But in the recently renewed battle over casino gambling in Florida this year, the popular Spider-Man slot machine delivers a different sort of jolt altogether. Spider-Man is one of a stable of Marvel superheroes that the Walt Disney Co. acquired for $4 billion in 2009 and that continue to appear on slot machines, Internet slot machines and state lottery tickets. The lottery tickets have featured Iron Man and the Avengers.

Disney, a powerhouse in Florida because of its financial might and its sway over the tourism industry, has long led the fight against the expansion of casinos in the state, arguing successfully that gambling tarnishes Florida’s coveted family-friendly brand.

This year is no exception. For the second time in two years, state lawmakers are preparing to decide whether Las Vegas-style resort casinos should be allowed to open in Florida, a move that Disney hopes to thwart again. The company is so opposed to gambling that not even Disney cruise ships offer casinos, a mainstay of major cruise liners.

But in a nation increasingly awash in various forms of gambling, Disney is finding that keeping a constantly growing entertainment conglomerate completely removed from gambling is far more challenging than it used to be.

Asked whether Disney’s ties to the gambling industry, through Marvel, undercut its position on casino gambling, a Marvel spokeswoman said last week that the company planned to shed its connection to slot machines when the various licensing agreements expire. On Saturday, the spokeswoman added that Marvel had signed its last slot machine deal two years ago.

Spider-Man, Iron Man, the Incredible Hulk and others will begin to disappear from casinos and Internet gambling sites over the next “few years,” the spokeswoman said.

“Marvel discontinued plans to initiate or renew slot machine licensing arrangements as part of its integration with Disney,” the spokeswoman said. “The handful of remaining license agreements have expiration dates within the next few years.”

The spokeswoman also said late Saturday that Marvel has no active lottery deals and does not plan to sign any new one.

Disney also faces a similar issue with its $4 billion acquisition of Lucasfilm last year. “Star Wars” characters, which have been featured in Disney parks for years, are also widely used in slot machines.

On Thursday, a Disney spokeswoman said the decision not to renew Lucasfilm and Marvel licensing agreements once they expired had been made recently. It had not previously been made public.

In the years since Disney’s acquisition of Marvel, gambling opponents and the company’s critics, including those seeking to open Vegas-style casinos in Florida, have accused Disney of being disingenuous in its campaign against casinos as new slot machines rolled out. Its competitors argue that Disney fears competition more than gambling.

“Disney’s internecine warfare against integrated resorts in Florida under this pretense demeans them significantly,” said Michael A. Leven, president and chief operating officer of the Las Vegas Sands Corp., which seeks to open a casino in South Florida.

A spokeswoman for Walt Disney World, Andrea M. Finger, said it could take several years for policies to align after two corporations merged, always a complex endeavor. But she said Disney’s commitment to keeping Vegas-style resorts out of the state was unwavering.

“We oppose the legalization of so-called destination resort casinos because this major expansion of gambling is inconsistent with Florida’s reputation as a family-friendly destination,” Finger said.

The decision that Disney, through Marvel and Lucasfilm, will phase out its slot machine licensing agreements comes at a pivotal time for Disney and its biggest allies, the influential Florida Chamber of Commerce and No Casinos, a nonprofit organization dedicated to keeping more casinos out of Florida. The groups are engaged in the latest chapter of a battle over the expansion of large casinos in Florida, an issue awash in lobbyists and money.

Gambling is commonplace in Florida. The Seminole Tribe, which owns the Hard Rock brand, has seven large and small casinos in Florida with some table games but no roulette or craps.

Thoroughbred and greyhound racetracks, and jai alai frontons, all feature poker rooms, and in Miami-Dade and Broward counties, the racinos, like Mardi Gras, also offer slot machines.

The racinos also oppose Vegas-style casino gambling expansion.

Despite a decision last year to waylay a bill on expansion after fierce lobbying by Disney and others, the Legislature is now poised to take up the issue again. The decision stems in large part from the fact that the state’s five-year agreement with the Seminole Tribe expires in 2015. The agreement gives the tribe exclusive rights to table games like blackjack in their casinos. (Slot machines are covered under a separate agreement.) In exchange, the tribe pays the state $1 billion over five years.

The state and the tribe will soon have to negotiate a new agreement. Competition from full-scale private casinos in the state could scramble the deal and drain the state of $233 million a year, from the tribe, with no guarantee that tax money from expanded private casinos would offset the loss.
For Disney, the debate over casinos has grown more difficult in the past year as its relationship with Marvel becomes more obvious to theme park visitors and other Disney customers.

“Hypocrisy is in the eye of the beholder,” said Robert Jarvis, a law professor at Nova Southeastern University’s Law Center and an expert on gambling law. “If they were honest, they would just come out and say, it’s Business 101. We’re trying to protect our turf, and we’ve always attempted to do that.”

Marvel merchandise has been sold in Disney stores and gift shops since shortly after the Marvel acquisition. Now Marvel’s superheroes, including Iron Man and Thor, will soon be featured alongside Disney princesses and Mickey Mouse in some Disney parks. In November, Thor will become the first Marvel character to greet visitors at Disneyland in California. Captain America is expected on cruise ships soon.

Because of an agreement with Universal Studios, Disney World in Orlando cannot feature live Marvel characters or create Marvel rides. But merchandise is available.

The fact that Marvel characters crop up around the country in lottery tickets further complicates the issue for Disney. In Colorado this spring, shoppers could buy scratch-off lottery tickets featuring Iron Man. And in Idaho and Texas, the Avengers were featured on scratch-off tickets.

While some consider lottery tickets a benign form of gambling, Keith Whyte, executive director of the National Council on Problem Gambling, said scratch-off tickets are a “gateway” to more serious gambling. Some tickets are even sold in vending machines, making them easily accessible to children, Whyte said.

For John Sowinski, the president of No Casinos, Disney critics are using the slot machine issue simply to distract.

“They want to change the subject,” he said of the large-casino interests. “They don’t want to have a discussion about the merits of the issue. If Disney wanted to be in the gambling business, they would be, on their cruise ships and elsewhere.”






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