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The legalization of sports wagering in New Jersey has triggered a court battle over efforts to open a betting facility at the former Garden State Park racetrack in Cherry Hill.

Garden State Park, where horse racing ended in 2001, is one of five sites in New Jersey, outside Atlantic City, that are permitted to host sports wagering under state law. Plaintiff Cherry Hill Towne Center Partners, the owner of a parcel at Garden State Park that includes the former racetrack oval, seeks to establish an off-track horse wagering facility, sports betting site, or both. But a 1999 restrictive covenant forbids simulcasting, off-track betting or any other wagering run by anyone other than defendant GS Park Racing.

Cherry Hill Towne Center Partners seeks declaratory and injunctive relief against the covenant. It seeks a declaration that the covenant is invalid and unenforceable because it has no end date, fails to protect the legitimate business interests of the defendants, and is void as against public policy. In the alternative, Town Center Partners seeks to have the covenant declared only partly enforceable and to obtain a ruling finding that it does not prohibit newly-permitted sports betting, which could not have been contemplated at the time it was executed.

Towne Center Partners consists of Jack Morris, Sheryl Weingarten and Joseph Marino. Morris is president of Edgewood Properties, which he founded with his wife, Weingarten. Morris and Marino, the president of Century 21 Construction, have built housing and retail stores on the Garden State Park site.

GS Park Racing is owned by Pennwood Racing Inc., Penn National Gaming and Greenwood Limited Jersey, which also own Freehold Raceway, 50 miles north of Garden State Park. Freehold is another of the five tracks around the state that are authorized to establish sports betting operations. The others are at the Meadowlands in East Rutherford, at Monmouth Park in Oceanport and at Atlantic City Race Course in Mays Landing.

The U.S. Supreme Court struck down the law that barred most states from allowing sports betting on May 14.

Morris was quoted in an article published May 14 on website ROI-NJ.com as saying that he was exploring adding sports betting to the Garden State Park site as well as at the new Hard Rock Hotel & Casino in Atlantic City, which is developed in a joint venture. He said, “When we bought the property, we weren't contemplating sports betting, but we are now.”

On June 11, Gov. Phil Murphy signed legislation allowing wagering on professional and college sports.

Garden State Park Racing's attorney, Roberto Rivera-Soto of Ballard Spahr in Cherry Hill, then wrote to the plaintiffs on June 22. He wrote that any party other than Garden State Park Racing is prohibited from conducting “wagering of any sort” at the site, and added that his client “attaches significant importance and value to the rights it holds under the restrictive covenants. Anticipating that you would be interested in discussing this matter with our client, our client will be happy to arrange a meeting at your and our client's mutual convenience.”

Towne Center Partners filed suit in state Superior Court in Camden on July 31 and defendant GS Park Racing removed it to federal court Aug. 16. The suit also names Greenwood New Jersey, which dissolved in 2002, and Greenwood Racing as defendants.

Towne Center Partners said GS Park Racing owns another parcel of land adjacent to Garden State Park, but has shown no interest in developing off-track betting there. In 2010, Penn National Gaming and Penn National Holding Co., as joint venture partners in Greenwood Racing, brought a shareholder action against that company to compel development of the vacant property as an off-track wagering facility. The suit said Greenwood Racing had a fiduciary duty to the joint venture to develop such a facility and that Greenwood Racing had resisted in order to prevent competition with other off-track betting sites that company owns in Pennsylvania.

The restrictive covenant was provided as part of a declaration provided when Freehold Raceway was purchased from Greenwood and as part of the lease of the Garden State Park facility by GS Park Racing, which operated the Cherry Hill facility as a race track until it closed in 2001, the suit said.

U.S. Magistrate Judge Karen Williams of the District of New Jersey has set an initial scheduling conference in the case for Oct. 11.

Rivera-Soto did not return a call about the case; nor did William Tambussi of Brown & Connery in Westmont, who represents Town Center Partners.