Gecker v. Flynn (In re Emerald Casino, Inc.)

MEMORANDUM OPINION AND ORDER

REBECCA R. PALLMEYER, United States District Judge.

TABLE OF CONTENTS.

BACKGROUND

I. A “big to-do”... 59

A. Emerald Casino, Inc. is created and issued a license to operate a riverboat casino... 60

B. Donald Flynn takes control of Emerald ... 61

C. Emerald lobbies for relocation... 64

D. 1999: Emerald’s golden year... 66

E. An unfortunate association: Emerald relocates in Rosemont... 68

F. The IGB doggedly investigates Emerald ... 70

G. The IGB revokes Emerald’s license ... 72

H. Procedural History.. .74

II. A casino in Rosemont... 75

A. Emerald lays the groundwork to move to Rosemont.. .75

I. Kevin Flynn met with Mayor Donald Stephens in 1997.. .75

2.The alleged agreement between Emerald, the Davis Companies, and Du-chossois Industries... 77

B. Emerald attempts to relocate to Rosemont.. .83

1.Emerald’s construction activities ... 84

a. Construction progress... 84

b. Financing construction.. .87

c.Communication with the IGB...89

i. The pre-approval construction requirement.. .89

ii. The IGB was aware of construction ... 90

2. Emerald failed to disclose preliminary agreements between Emerald and Rosemont to the IGB... 96

3. The IGB found that the final Lease and Development Agreement between Emerald and Rosemont violated IGB rules... 101

III.Defendants’ disclosures to the IGB... 104

A. Emerald’s September 24, 1999 Renewal Application... 104

1. Question 16: public officials... 105

2. Question 21: agreements... 108

3. Question 31: threatened litigation ...109

4. Questions 46 & 47: agreements with municipalities.. .112

B. Construction Agreements... 113

1. Aria Architects... 113

2. Degen & Rosato Construction Company/ Power Construction LLC, Joint Venture (“Joint Venture”).. .114

3. Other agreements... 115

4. Communication with the IGB.. .115

a. September 24, 1999 Renewal Application. . .116

b. September 30, 1999 meeting with the IGB... 116

c. Communications with the IGB after September 30,1999... 117

C. Kevin Flynn... 119

1. Pre-June 23, 1999 involvement in Emerald... 119

a. Pre-1999 meetings & agreements with third parties... 122

i. Lake County Riverboat... 122

*56 ii. Meeting with Mayor Stephens ...124

iii. Davis and Duchossois meetings and alleged agreement.. .124

iv. Meeting with Gary Armentr-out...l26

b. Lobbying.. .127

c. Emerald’s management & Board' meetings... 129

2. Field Street Agreement... 134

IV. Transfer of Emerald shares... 137

A. Amendment to Emerald’s Shareholders’ Agreement.. .137

B. Transfer of shares to Kevin Flynn, Joseph MeQuaid, John McMahon, Kevin Larson, and Walter Hanley, the “Officer Defendants”... 139

1. Emerald’s Restricted Stock Award Plan...140

2. Amended' and Restated Purchase Agreement.. .140

3. The Officer Defendants executed the Amended Shareholders’ Agreement and were issued Emerald shares... 141

C. Transfers of shares to and from Donald Flynn... 143

D. Emerald sells shares to the Statutory Investors... 148

E. Defendants’ communication with the IGB about the transfers of shares... 151

1. Defendants failed to obtain IGB pre-approval for the transfers of shares... 151

2. Defendants disclosed the transfers of shares after the transfers were completed. . .157

V. Procedural History... 161

A. IGB revocation proceedings... 161

B. Bankruptcy proceeding... 163

C. Payton Plaintiffs’ litigation... 165

D. District court... 171

DISCUSSION

I. Standard of Review... 171

II. Count I: Fiduciary Duty.. .172’

A. The Trustee’s fiduciary duty claim is barred by the statute of limitations ...172

1. Adverse domination... 172

2. Pedersen’s arguments against tolling. . .174

3. Flynn Defendants’ arguments against tolling: rebutting the presumption of adverse domination... 175

i. Knowledge... 176

ii. Ability.. .177

iii. Motivation.. .178

III. Count II: Breach of Contract.. .180

A. The Trustee’s breach of contract claim is not barred by res judicata ... 180

1. Final Judgment on the Merits... 181

2. Same claims and same parties... 181

a. The Payton and estate breach of contract claims are the same... 181

b. The parties may be the same... 184

3. Defendants are estopped from asserting res judicata ... 185

B. Merits... 190

1. The Amended Shareholders’ Agreement is a valid and enforceable contract. . .190

a. Defendants are parties to the Amended Shareholders’ Agreement. . .190

b. The “comply provision” of Paragraph Ten of the Amended Shareholders’ Agreement is enforceable... 195

*57 2.Defendants breached their obligations under the Amended Shareholders’ Agreement.. .195

a. The Amended Shareholders’ Agreement imposes strict liability and does not require proof of Defendants’ state of mind.. .195

b. Certain Defendants engaged in conduct that caused the IGB to revoke the license... 197

i. IGB Count I: Rule 140(a)... 197

(a) Failure to disclose Kevin Flynn’s involvement in management and operation of Emerald... 197

(b) Failure to disclose agreements between Emerald and Rose-mont.. .198

(c) Failure to disclose agreements between Emerald and various construction professionals and subcontractors ...198

(d) Rule 140(a) violations for which the Trustee has not established Defendants’ conduct... 198

ii. IGB Count II: Rule 140(b)(3).. .199

(a) Failure to disclose agreements between Emerald and Rose-mont.. .199

(b) Failure to disclose agreements between Emerald and various construction professionals and subcontractors ...199

(c) Rule 140(b)(3) violations for which the Trustee has not established Defendants’ conduct.. .199 in. The Trustee has not established that any Defendants have violated IGB Count III, Rule 140(b)(7).. .199

iv. IGB Count IV: Rule 235(a).. .200

(a)Transfer of shares between Donald Flynn and the Twelve Outsiders without IGB prior approval...200

(b) Transfer of shares between Donald Flynn and the Five Insiders without IGB prior approval.. .200

(c) Transfer of shares between Emerald and the Statutory Investors without IGB prior approval... 201 v. IGB Count V: Rule 110(a).. .201

(a) Failure to fully, truthfully, timely, and accurately disclose information to the IGB.. .201

(b) Failure to disclose Kevin Flynn’s involvement in management and operation of Emerald... 201

(c) Rule 110(a) violations for which the Trustee has not established Defendants’ conduct.. .201

3. Defendants’ breach caused the loss of the license.. .202

a. Cause in fact... 202

b. Legal cause.. .204

4. The court denies Defendants’ motion for leave to file third-party complaint against Eugene Heytow.. .206

IV. Count TV: Equitable Subordination. . .206

V. Damages.. .206

A. Defendants are severally liable... 208

B. The value of Emerald’s license. . .211

1. Testimony of Steven M. Ritt-. vo...212

a. Daubert challenge remains pending. . .212

b. Daubert standards.. .213

c. Mr. Rittvo is qualified.. .213

d. Mr. Rittvo’s testimony is relevant. . .215

e. Mr. Rittvo’s testimony is not sufficiently reliable. . .215

*58 i. Flaws in base-year revenue calculations. . .216

(a) Use of the gravity model to predict attendance data.. .216

(1) Mr. Rittvo did not specify his methods for calculating the propensity and frequency factors.. .218

(2) Mr. Rittvo’s method for calibrating the model is sufficiently reliable ...219

(3) The “Rittvo Effect” is not sufficiently reliable. . .219

(b) The win-per-visit amount is not sufficiently reliable... 220

(c) The proprietary model for operating expenses is not sufficiently reliable. . .221

ii. Mr. Rittvo did not account for specific risks that existed as of February 2001, which would have reduced the value of Emerald’s license at that time.. .221

iii. Other alleged flaws in Mr. Ritt-vo’s calculations.. .222

(a) Improper factual underpinnings. . .223

(b) Improper inclusion of prejudgment interest.. .223

2. New business rule... 224

3. Evidence showing the market value of Emerald’s license.. .228

a. Rosemont valuations... 231

i. August 1999 EVI valuation. . .231

ii. 2000 valuation for the Davis litigation. . .232

iii. 2001 MGM Mirage offer... 232

iv. 2004 Rothschild auction and Isle of Capri bid... 233

b. Non-Rosemont bid from Midwest Gaming in 2008.. .233

4. The Trustee proved damages with a reasonable degree of certainty.. .234

5.The principles of equity do not support a reduction of damages.. .235

CONCLUSION .. .237

APPENDICES

Appendix A: Procedural History Chart

Appendix B: Selected IGB Rules

Appendix C: Contract Liability Chart

A licensé to operate a casino in Illinois should have great value. In 1999, Emerald Casino, Inc. (“Emerald”) held such a license, permitting it to operate a riverboat, but its East Dubuque location was not profitable. When the Illinois General Assembly passed legislation authorizing a land-based casino, it appeared Emerald’s problems were in the past. But on January 30, 2001, the Illinois Gaming Board (“IGB”) revoked the license after an unprecedented and aggressive investigation of Emerald and its officers, directors, and shareholders. The IGB’s primary concern appears to have been that “organized crime” was somehow involved in Emerald’s proposed new location — Rosemont, Illinois. Emerald was less than forthcoming in its communications with the IGB, which heightened . regulators’ suspicions. Ultimately, the IGB concluded that Emerald had violated several IGB rules and, for the first time in the IGB’s history, revoked a gaming license as a sanction. Emerald appealed the revocation order, but the Illinois Appellate Court affirmed. The license was Emerald’s only significant asset, and when Emerald was stripped of it, this bankruptcy proceeding swiftly followed.

Plaintiff in this case, Frances Gecker, is the Trustee appointed by the Bankruptcy Court on behalf of Emerald. Defendants are the former officers, directors, and shareholders of Emerald. The Trustee alleges that the individual Defendants were responsible for Emerald’s loss of its license. The Trustee claims that Defen *59 dants’ actions breached (1) their fiduciary duty to Emerald (Count I) and (2) Emerald’s Amended Shareholders’ Agreement (Count II), in which each Defendant had promised “to comply with the [Riverboat Gambling] Act, Rules, and orders of the IGB.” In addition, the Trustee seeks equitable subordination of Defendants’ claims against Emerald’s estate (Count IV), and to recharacterize certain loans made by Donald Flynn and Peer Pedersen to Emerald as equity (Count V). Finally, the Trustee seeks to disallow claims that Defendants made against Emerald’s estate; she argues that 11 U.S.C. § 502 (d) bars recovery (Count III), and that a settlement agreement (under which Defendants claim ■ an interest in Emerald) never became effective (Count VI). After a lengthy bench trial — initially before Judge Eugene Wed-off in the Bankruptcy Court, followed by additional days of testimony before this court — the court sets forth its findings of fact and conclusions of law on Counts I, II and IV. The court reserves judgment on Counts III, V, and VI.

As explained below, the court concludes that the Trustee’s breach of fiduciary duty claim is barred by the statute of limitations. She has established her claim of breach of contract, however, and the court finds Defendants Kevin Flynn, Dbnald Flynn, Joseph McQuaid, John McMahon, Kevin Larson, and Walter Hanley severally liable for breach of Emerald’s Amended Shareholders’ Agreement. The court awards the Trustee $272,000,000.00, and finds the Defendants severally liable for that amount, in equal proportions. Claims against Defendant Peer Pedersen are dismissed.

In addition, three motions remain pending: Donald Flynn’s motion to dismiss the Trustee’s claims for joint liability and punitive damages [64]; Defendants’ motion to dismiss Count II (breach of contract) as duplicative of Count I (breach of fiduciary duty) [113]; and Certain Defendants’ motion for judgment as a matter of law on Counts I and II as barred by the statute of limitations and res judicata, respectively [246]. Because the court has dismissed the breach of fiduciary duty claim and has declined to impose joint liability on the breach of contract claim, Donald Flynn’s motion [64] is denied as moot, and Defendants’ motion to dismiss the breach of contract claim [113] is denied. Certain Defendants’ motion to dismiss on the basis of the statute of limitations and res judica-ta [246] is granted in part and denied in part. Finally, Defendants urge this court to reconsider their motion [72] for leave to file a third-party complaint against Eugene Heytow. Heytow’s involvement was, however, similar to that of Peer Pedersen. As the court has dismissed claims against Peer Pedersen and has not imposed joint liability under the Amended Shareholders’ Agreement, the request for reconsideration is also moot.

BACKGROUND

I. A “big to-do” 1

Defendants are former officers, directors, and shareholders of an Illinois corporation, now named Emerald Casino, Inc., which was created in 1991 to operate a riverboat casino. Until January 30, 2001, Emerald held one of the ten licenses issued by the Illinois Gaming Board (“IGB”). On January 30, 2001, the IGB voted to revoke Emerald’s license, on find *60 ings that Emerald had repeatedly misled or misinformed the IGB about its activities and had violated several IGB rules. Emerald was forced into bankruptcy proceedings by its creditors on June 13, 2002. Plaintiff Francis Gecker is the Trustee on behalf of Emerald, appointed by the Bankruptcy Court. Ms. Gecker’s central claims in this case are that Defendants (1) violated their fiduciary duty to Emerald and (2) breached a contract — the Amended Shareholders’ Agreement — which obligated Defendants to comply with IGB rules, resulting in the loss of a license worth more than $500 million.

A. Emerald Casino, Inc. is created and issued a license to operate a riverboat casino

On December 17, 1991, Emerald Casino, Inc. 2 (“Emerald”) was incorporated as an Illinois corporation to operate a riverboat casino. (Trustee’s Proposed Findings of Fact & Conclusions of Law, Gecker v. Flynn, No. 08-ap-00972 [765], hereinafter “Trustee’s SOF,” ¶ 1; Certain Defs.’ Proposed Findings of Fact & Conclusions of Law at 1[252], hereinafter “C. Defs.’ SOF,” ¶ 63.) Emerald initially owned a 50% interest in the Jo Daviess Riverboat Joint Venture; the Jo Daviess Corporation owned the remaining 50% interest. (Trustee’s SOF ¶ 89; C. Defs.’ SOF ¶ 64.) On July 9, 1992, the IGB issued one of ten gaming licenses then available in Illinois to the Joint Venture. (Trustee’s SOF ¶ 89; C. Defs.’ SOF ¶ 40.) The license authorized the Joint Venture to operate a casino on the Mississippi River, within Jo Daviess County, Illinois, for a period of three years. (Trustee’s SOF ¶ 89; C. Defs.’ SOF ¶ 64.) Beginning in 1992, the Joint Venture used that license to operate the Silver Eagle Casino Cruise (“Silver Eagle”) riverboat on a waterway off the Mississippi River near East Dubuque, Illinois. (Trustee’s SOF ¶ 90; C. Defs.’ SOF ¶ 66.) On April 19, 1994, Emerald, with the approval of the IGB, purchased the Jo Da-viess Corporation and became the sole owner of the license. (Trustee’s SOF ¶ 91; C. Defs.’ SOF ¶ 64.)

Emerald, then known as HP, Inc., was founded by Eugene Heytow and Peer Ped-ersen, both of whom served on the original Board of Directors. (Trustee’s SOF ¶ 7; C. Defs.’ SOF ¶ 63.) Peer Pedersen was the corporation’s President and Gene Hey-tow was its Vice President. (PX1316 at 1.) 3 Heytow and Pedersen each brought in a group of original investors in addition to investing themselves. (Trustee’s SOF ¶ 7; C. Defs.’ SOF ¶ 63.) Defendant Donald Flynn was among the original investors in Peer Pedersen’s group. (Trustee’s SOF ¶ 13; C. Defs. SOF ¶ 63.) Shortly after Emerald was formed, on December 31, 1999, Defendants Pedersen and Donald Flynn, along with the other investors, entered into a Shareholders’ Agreement. (Trustee’s SOF ¶ 63; C. Defs.’ SOF ¶ 239.) The Agreement included a provision that required compliance with IGB rules:

Each shareholder shall cooperate with the Corporation and the Venture to provide any disclosure information to the IGB and take any actions necessary to secure the preliminary approval and license to operate the business of the Venture. Upon issuance of said license, each Shareholder further agrees to com *61 ply with the [Riverboat Gambling] Act and all rules and orders of the IGB and shall not commit any acts which would jeopardize the license or a renewal thereof.

(PX1008 at 120, ¶ 10.) At least initially, life on the Mississippi appeared to be profitable. In 1993, Emerald's first full year of operation, the company generated $32 million in gross receipts. (Trustee’s SOF ¶ 90.)

By 1994, however, problems emerged. First, Emerald received a Disciplinary Complaint from the IGB on December 1, 1994 for failure to obtain IGB approval before changing the corporation’s equity and debt capitalization. (PX332; Trustee’s SOF ¶ 94.) Specifically, Emerald sought to restructure the debt it had acquired when it purchased the Jo Daviess Corporation (PX332; Trustee’s SOF ¶ 94.) Emerald entered into two new loan agreements to provide funds to pay off the corporation’s outstanding debts. (PX332 at 2, ¶¶ 8-10.) Emerald did not seek or obtain the required IGB approval for the new loan agreements, however, and also failed to notify the IGB of the source of the funds. (PX332 at 2, ¶ 11.) In its Disciplinary Complaint, the IGB found that Emerald had violated two IGB rules. (PX332 at 3.) IGB also fined Emerald $30,000 for the violations. (PX332 at 3.) It was Defendant Joseph McQuaid, who later became a principal of Emerald but was at the time working for the IGB, who signed the Disciplinary Complaint on the agency’s behalf. (PX332 at 3; Trustee’s SOF ¶ 94.)

A second source of concern for the corporation was competition: The Iowa riverboat casinos and a dog track opened in Dubuque, Iowa. (C. Defs.’ SOF ¶ 69.) The Silver Eagle remained subject to Illinois’ cruise protocol, which required that a riverboat leave the dock and be floating in the Mississippi River before any gaming operations could take place. (Id. at ¶ 70.) But in 1994, Iowa lifted its cruise protocol and began to allow dockside gambling, so that patrons could come and go freely, making Iowa casinos more attractive to potential patrons. (Id.) Furthermore, the dog track in Iowa provided patrons with access to slot machines, creating still more competition. (Id.)

On February 1, 1995, in response to these financial challenges, Emerald hired Joseph McQuaid, who had previously been employed at the IGB, to manage development and compliance. (C. Defs.’ SOF ¶ 6.) Emerald operated the Silver Eagle through Aerie Hotels & Resorts Management, which was owned by Pedersen. (Trustee’s SOF ¶ 92.) McQuaid initially worked for Emerald through Aerie. (Trustee’s SOF ¶ 55.) Tasked with addressing Emerald’s deteriorating market position, McQuaid quickly concluded that the only remedy was to relocate the casino. (C. Defs.’ SOF ¶ 118.) In 1995, McQuaid, on behalf of Emerald, petitioned the IGB to relocate the license to the Vermillion River at Danville, a market less vulnerable to competition from Iowa.' (PX338 at 2; C. Defs.’ SOF ¶ 118.) The IGB renewed Emerald’s license in July of 1995 (Trustee’s SOF ¶ 96), but determined that it lacked authority to authorize a relocation of the license. (Tr. at 508.) In September, in response to an inquiry from Senator James “Pate” Phillip, the Illinois Attorney General issued an opinion seconding the IGB’s conclusion that it lacked authority to relocate Emerald’s license. (PX338.) By December of 1995, confined to its East Dubuque location, the Silver Eagle’s business languished and the company shut down its gaming operations. (Trustee’s SOF ¶ 96.)

B. Donald Flynn takes control of Emerald

In 1996, while the Silver Eagle was still shuttered, Donald Flynn took on a much *62 more active role in Emerald and invested in a second of Pedersen’s casino projects: HP of Indiana, Inc., an Indiana corporation. At the time, HP of Indiana was not operating a casino, but Donald Flynn’s team eventually opened one, the Blue Chip, in Michigan City, Indiana. (See C. Defs.’ SOF ¶¶ 73, 108.) Donald Flynn made significant investments in HP of Indiana to get the Blue Chip Casino up and running. (See id.)

According to Defendants, Donald Flynn was primarily interested in investing in HP of Indiana, but Peer Pedersen required that he invest in Emerald as well. (C. Defs.’ SOF ¶ 73.) Donald Flynn, therefore, also entered into a series of agreements to provide capital to Emerald in exchange for Emerald stock or stock options. (Trustee’s SOF ¶¶ 19-21; see also C. Defs.’ SOF ¶ 73) (“in the summer of 1996, Donald Flynn increased his investment in HP”). Buoyed by the infusion of capital to Emerald, the Silver Eagle reopened in May or June of 1996. (Trustee’s SOF ¶ 96; C. Defs.’ SOF ¶71.) Donald Flynn’s stock purchases increased his ownership to 40%. (Trustee’s SOF ¶ 20.) In exchange for this investment in Emerald, Pedersen granted Donald Flynn control over Emerald’s Board and discretion over the officers. (PX899 at 17, 19; Peer Ped-ersen Estate’s Proposed Findings of Fact & Conclusions of Law [241], hereinafter “Pedersen’s SOF,” ¶¶3-4.) The Stock Purchase Agreement executed by Emerald and Donald Flynn specifically stated that so long as Donald Flynn was the largest shareholder, “the Company shall take all actions within its control to cause a majority of the Company’s board of directors to be designees” of Donald Flynn. (PX899 at 17.) Furthermore, Emerald promised to deliver “the written resignations of the directors of the Company and the written resignations of such officers of the Company as may be requested by” Donald Flynn. (Id. at 19.) Donald Flynn did in fact proceed to replace Emerald’s management team with his own. On June 7, 1996, Pedersen wrote a letter assuring Donald Flynn that Flynn would receive control of Emerald’s management at the “earliest possible date.” (PX528.) Later that month, on June 23, 1996, Pedersen resigned his position as President. (PX1316 at 69.) Donald Flynn also terminated Emerald’s contract with Aerie Hotels & Resorts Management, which was Pedersen’s company, and had been running the casino until then. (Trustee’s SOF ¶ 101; C. Defs.’ SOF ¶¶ 596-97.) After obtaining control of both Emerald and HP of Indiana, Donald Flynn installed essentially the same management team to run both corporations. (See C. Defs.’ SOF ¶ 109.)

Although Pedersen had transferred management control to Donald Flynn, Pedersen did retain his own shares in the company and his position on the Board of Directors.. (Trustee’s SOF ¶¶ 9, 12.) On September 9, 1996, as part of the leadership transition, Donald Flynn also became a member of the Board of Directors, consisting at that time of Eugene Heytow, Peer Pedersen, and Donald Flynn. (Trustee’s SOF ¶ 102; C. Defs.’ ¶ 74.)

The management team at Emerald overlapped substantially with the team at Blue Chip. (See C. Defs.’ SOF ¶109) (“Each of the Officer Defendants was a member of Blue Chip’s management team.”) Defendant Kevin Larson was appointed President of both casinos and the Chief Operating Officer of Blue Chip Casino. (Trustee’s SOF ¶¶ 42-43; C. Defs.’ SOF ¶¶ 16, 21.) Joseph McQuaid, who was the Vice President of Development and Compliance at Blue Chip, became Vice President of Emerald (PX676 at 3; PX1316 at 67; Trustee’s SOF ¶¶ 57, 102), and was tasked with development and compliance. (C. Defs.’ SOF ¶ 6.) In 1996, *63 Defendant John McMahon joined Emerald as Director of Finance and worked for Blue Chip as the Chief Financial Officer and Senior Vice President. ' (C. Defs.’ SOF ¶¶ 1, 3.) 4 Donald Flynn stepped into the roles of Secretary, Treasurer, and Vice President of Emerald. (PX1316 at 67; Trustee’s SOF ¶ 102.) The management staff for the two casinos also began sharing office space. (Trustee’s SOF ¶ 28; C. Defs.’ SOF ¶ 111.)

In 1996, Defendant Kevin Flynn, Donald Flynn’s son, was named Blue Chip’s Chief Executive Officer and the Chairman of the Board. (C. Defs.’ SOF ¶29.) Emerald had no named CEO at this time. (PX1316 at 1) (listing original officers.) According to the Trustee, Kevin Flynn was actively managing Emerald’s day-to-day operations and routinely acting on behalf of Emerald in negotiations, although he was not officially employed by Emerald. (Trustee’s SOF ¶ 29.) Defendants acknowledge Kevin Flynn’s presence and participation at several important meetings, but they maintain that he was simply attending on behalf of his father, Donald Flynn, who had entered partial retirement and was frequently traveling on his boat. (C. Defs.’ SOF ¶ 77.) In a later investigation, the IGB concluded that Kevin Flynn had acted as Emerald’s primary spokesperson in negotiations and entered into agreements on behalf of Emerald as early as 1997, and that Kevin Flynn’s statements minimizing that activity constituted “dissembling].” (PX162 at 16,17.)

Finally, Defendant Walter Hanley worked for Blue Chip as Senior Vice-President, General Counsel, and Secretary. (Trustee’s SOF ¶ 49; C. Defs.’ SOF ¶ 109.) The Trustee asserts that Hanley, who attended all but one of Emerald’s board meetings, was also a de facto manager of Emerald. (Trustee’s SOF ¶52.) Defendants insist, however, that Hanley’s only function at these meetings was to compile minutes. (C. Defs.’ SOF ¶ 117.)

Shortly after Donald Flynn took control of Emerald, the IGB issued a second Disciplinary Complaint on July 24, 1996. (PX125; Trustee’s SOF ¶ 103; C. Defs. SOF ¶ 99.) This Complaint charged Emerald with (1) failing to disclose or seek IGB approval for a stock option that Donald Flynn had received in exchange for his providing loans and capital to Emerald and (2) failing to disclose or seek IGB approval for loans from Pedersen and Heytow to Emerald. (PX125 at 2-3; Trustee’s SOF ¶¶ 103-04; C. Defs. SOF ¶ 99.) On June 14, 1996, the IGB discovered «Donald Flynn’s receipt of this stock option, and on July 19, 1996, the IGB learned about the loans from Heytow and Pedersen, both as a result of Emerald’s letters to the IGB disclosing those transactions. (PX125 at 2-3; Trustee’s SOF ¶ 103.) The IGB concluded that Emerald had violated IGB Rule 230(d)(3), 86 III. Admin. Code § 3000.230(d), which requires licensees to immediately inform the IGB of and obtain approval for a change in equity or capitalization. 5 (PX125 at 3.) The IGB fined Emerald $10,000 (PX125 at 3-4), which *64 Emerald paid without contesting the Disciplinary complaint. (Trustee’s SOF ¶ 105.) Because the infusion of capital had shored up the company’s finances, however, the IGB agreed in July 1996 to renew Emerald’s license for a period of one year beginning August 1, 1996. (PX 906; Trustee’s SOF ¶ 108; C. Defs.’ SOF ¶88.) In a Financial Obligation and Licensure Agreement with the IGB, Emerald agreed, among other conditions for the one-year renewal, to secure at least $3 million in credit, to pay its other debt obligations. (Trustee’s SOF ¶ 108.) After the license was renewed, Larson, acting as President of Emerald, executed a $3 million Credit Agreement with Donald Flynn, Eugene Heytow, and Peer Pedersen as lenders. (Trustee’s SOF ¶ 112.)

Unfortunately, the $3 million credit line was not enough to meet the needs of the Silver Eagle. By February 20, 1997, Kevin Larson sought IGB approval from Administrator Michael Belletire for two more loans from the shareholders to Emerald totaling $2.5 million dollars. (PX924; PX933; Trustee’s SOF ¶¶ 116-17; C. Defs.’ SOF ¶ 91.) Administrator Belletire . approved Emerald’s request for the loans on February 21, 1997 and April 22, 1997. (PX925; PX938; Trustee’s SOF ¶¶ 116-17; C. Defs.’ SOF ¶ 91.)

Also in the spring of 1997, Emerald sought to renew its license for an additional year, submitting a Renewal Application on April 10, 1997. (PX363 at 1; Trustee’s SOF ¶ 121; C. Defs,’ SOF ¶ 94.) The IGB initially cited deficiencies in the Renewal Application and requested additional information (PX363; Trustee’s SOF ¶ 121); then on June 24,1997, the IGB unanimously voted to deny Emerald’s Renewal Application. (PX129; Trustee’s SOF ¶ 122; C. Defs.’ SOF ¶ 94.) In a letter from Administrator Belletire, the IGB cited six standards that Emerald had failed to meet: Emerald “[1] Submitted a non-responsive application. [2] Maintains an inadequate gaming operation. [3] Lacks financial viability. [4] Exhibits significant compliance shortcomings. [5] Does not provide for positive economic development and impact. [6] Does not adhere to the overall requirements of the Act.” (PX129 at 2.) The IGB focused primarily on the Silver Eagle’s financial difficulties, but also asserted that Emerald' had violated IGB Rule 236(b)(5), 86 III. Admin. Code § 3000.236(b)(5).' (PX129 at 6.) One of the shortcomings was that Emerald “was subject to discipline during the past year for failing to disclose and obtain approval for certain financial transactions,” a reference to the second Disciplinary Complaint. (PX129 at 6.) Following the notice of denial, Emerald ceased operations at the Silver Eagle on July 29, 1997; the casino never opened again. (Trustee’s SOF ¶ 124; C. Defs.’ SOF ¶ 101.)

In August of 1997, Emerald requested an administrative hearing to review the IGB’s decision to deny the Renewal Application. (Trustee’s SOF ¶ 126.) Emerald retained the license during the pendency of the appeal (Trustee’s SOF ¶ 123; C. Defs.’ SOF ¶ 104), but had no plan to reopen the Silver Eagle in East Dubuque. Instead, Emerald’s stated goal in pursuing the appeal was to delay the loss of the license long enough to obtain legislative approval for relocation of the license. (C. Defs.’ SOF ¶ 104.)

C. Emerald lobbies for relocation

Over the course of the next few years, until 1999, while the administrative hearings were ongoing, various members of Emerald’s management team spent time lobbying the Illinois General Assembly to revise the Illinois Riverboat Gambling Act in order to allow Emerald to relocate its license. (See C. Defs.’ SOf' ¶ 119.) Don- *65 aid Flynn provided funding for the lobbying activities. (Id. at ¶ 120.) Kevin Flynn, although not technically employed by Emerald, reported back to Donald Flynn, keeping him up to date on the lobbying activities and how the -money had been spent. (C. Defs.’ SOF ¶ 120.) Kevin Flynn also attended several meetings with lobbyists during this time. (Tr. 2660:17-20; Trustee’s SOF ¶ 299.) Joseph McQuaid oversaw the lobbying efforts and traveled to Springfield to meet with the lobbyists Emerald had hired. (C. Defs.’ SOF ¶ 122.)

Starting in November 1998, during the lobbying efforts, %ere were a handful of meetings between Kevin Flynn, Joseph McQuaid, Donald Stephens, the Mayor of the Village of Rosemont, and representatives of two other organizations, the Davis Companies and Duchossois Industries. (Trustee’s SOF ¶260, 272, 274-75, 277-78; 285; 289; C. Defs.’ SOF ¶ 138, 135, 495-96, 499-500, 504, 515.) Marvin Davis, a principal and owner of the Davis Companies, was an entrepreneur involved in real estate development and other businesses. (C. Defs.’ SOF ¶ 488.) Richard Duchossois was the owner of Duchossois Industries, a company which owned Arlington International Racecourse, a horse racing track in Arlington Heights, Illinois. (C. Defs.’ SOF ¶ 133.) The Trustee alleges that the Davis Companies and Duchossois Industries were interested in investing in a relocated casino, and that at these meetings, McQuaid and Kevin Flynn, agreed, on behalf of Emerald, to move the license to Rosemont and that Kevin Flynn agreed to sell ownership interests in Emerald to Davis, Duchossois, and to the Mayor of Rosemont upon relocation of the casino. (Trustee’s SOF ¶¶ 257, 330.) The Trustee also asserts that after the joint ownership deal was reached, in December of 1998, Davis and Duchossois worked with Kevin Flynn and other principals of Emerald on a joint lobbying strategy to obtain legislation that would permit relocation of Emerald’s license. (Trustee’s SOF ¶ 294.) The IGB, in its later investigation, found that although Emerald planned to move to Rosemont as early . as 1998, Emerald’s principals did not disclose that plan to the IGB until July 1999. (PX162 at 10.) The IGB found, further, that Kevin Flynn and McQuaid did enter into agreements to sell ownership interests, and further that Emerald did not inform the IGB of these agreements. (PX162 at 7-8.) Defendants maintain that no agreement to sell ownership interests ever existed and that the joint lobbying activities were no more than an effort to secure mutually beneficial legislation. (C. Defs.’ SOF ¶¶ 506,. 520.)

After several failed attempts in previous legislative sessions, in 1999 the lobbying activities bore fruit. On May 25, 1999, the Illinois General Assembly passed Public Act 91-40 which amended the Riverboat Gambling Act to allow relocation of Emerald’s license. (Trustee’s SOF ¶ 129; C. Defs.’ SOF ¶¶ 141-42.) Governor Ryan signed the bill into law on June 25, 1999. (Trustee’s SOF ¶ 129; C. Defs.’ SOF ¶ 142.) The new legislation added Section 11.2 to the Act. In language directly beneficial to Emerald, Section 11.2 provided:

(a) A licensee that was not conducting riverboat gambling on January 1, 1998 may apply to the Board for renewal and approval of relocation to a new home dock location authorized under Section 3(c) and the Board shall grant the application and approval upon receipt by the licensee of approval from the new municipality or county as the ease may be, in which the licensee wishes to relocate pursuant to Section 7(j).

230 ILCS 10/11.2 (emphasis added). Emerald, the only licensee that was not conducting riverboat gambling on January 1, *66 1998, was the only entity who could take advantage of Section 11.2. (C. Defs.’ SOF ¶ 144.) The legislation also imposed a requirement that the relocated licensee provide investment opportunities for minority and female investors:

(b) Any licensee that relocates its home , dock pursuant to this Section shall attain a level of at least 20% minority person and female ownership at least 16% and 4% respectively, within a time period prescribed by the Board, but not to exceed 12 months from the date the licensee begins conducting gambling at the new home dock location. The 12-month period shall be extended by the amount of time necessary to conduct a background investigation pursuant to Section 6. For purposes' of this Section, the terms “female” and “minority person” have the meanings provided in Section 2 of the Business Enterprise for Minorities, Females, and Persons with Disabilities Act.

230 ILCS 10/11.2. Just weeks before the legislation passed, on May 5, 1999, an Administrative Law Judge had upheld the IGB’s decision to deny Emerald’s 1997 Renewal Application. (Trustee’s SOF ¶ 128; C. Defs.’ SOF ¶ 139.) The IGB later determined that the new legislation rendered the ALJ’s decision moot and instead began developing a new renewal application form to conform with the new statutory language; (Trustee’s SOF ¶¶ 134-35.)

D. 1999: Emerald’s golden year

Just after passage of the legislation allowing Emerald to relocate, Emerald underwent several changes in leadership, at least on paper. On June 23, 1999, the Board of Directors approved a new management structure for Emerald. (PX1316 at 125-26.) Donald Flynn stepped down from his positions as Secretary, Treasurer, and Vice-President. (Trustee’s SOF ¶ 22.) John McMahon, Kevin Larson, and Joseph McQuaid essentially retained their previous functions, but were awarded new titles: McMahon was named a Senior Vice President, the Chief Financial Officer, and Treasurer (PX1316 at 126), after serving as director of finance from 1996. (C. Defs.’ SOF ¶ 1.) McQuaid was named Senior Vice President of Development and Compliance (PX1316 at 126) after being hired for development in compliance in 1995 and serving as Vice President starting in 1996. (PX1316at67; C. Defs.’SOF ¶ 6.) Larson maintained his position as President but was also named Chief Operating Officer of Emerald. (PX1316 at 126; Trustee’s SOF ¶46; C. Defs.’ SOF ¶ 151.) Larson and McQuaid were also elected to the Board of Directors. (PX1316 at 124.)

The Board of Directors officially named Kevin Flynn and Walter Hanley officers of Emerald. Hanley was named Senior Vice President, Secretary, and General Counsel. (PX1316 at 126.) Kevin Flynn was named Chairman of the Board and was appointed to the new position of Chief Executive Officer. (PX1316 at 126; C. Defs.’ SOF ¶ 151.) The addition of Kevin Flynn and Walter Hanley was a mere formality, according to the Trustee. She alleges that both Flynn and Hanley had been acting on behalf of Emerald in practice since 1996 when they started working for Blue Chip and sharing offices with Emerald. (Trustee’s SOF ¶ 29.) According to the Trustee, Larson served primarily as a figurehead; Kevin Flynn had been managing the operations of Emerald since 1996. (Trustee’s SOF ¶ 102.) The IGB itself later found in its Final Board Order that Kevin Flynn had been acting on behalf of Emerald pri- or to his appointment as CEO in 1999 and that he had misled the IGB about the extent of his involvement with Emerald. (PX162 at 18.) The IGB did not make any *67 findings with respect to Walter Hanley. (See PX162.)

Also at the June 23, 1999 Board meeting, the Board of Directors approved a Restricted Stock Award Plan (PX1316 at 130), and several agreements to sell restricted stock under the Plan. (PX521; PX1316 at 113.) The Restricted Stock Award Plan was intended to provide “grants of awards of Restricted stock” to “key officers and employees” as part of their compensation. (PX521 at 2.) By its terms, the Plan would “become effective on June 23, 1999 (subject to approval, to the extent required, by the Illinois Gaming Board or its Administrator).” (PX521 at 2.) In a letter dated June 30, 1999, McQuaid notified the IGB of the Restricted Stock Award Plan and asked for prompt consideration of the Plan. (PX304 at 1.) McQuaid’s letter also included a document titled “Proposed Awards on June 23, 1999,” listing the amounts of shares issued to Emerald employees under the Restricted Stock Plan. (Id. at 14.)

Emerald did not, however, wait for IGB approval before executing the Stock Agreements with its “key officers and employees.” John McMahon, Kevin Larson, Joseph McQuaid, Kevin Flynn, and Walter Hanley (“Officer Defendants”) each signed a Restricted Stock Agreement on June 23, 1999, under which each was awarded Emerald stock subject to the terms of the Restricted Stock Award Plan. (PX521 at 14, 22, 26, 30, 34; Trustee’s SOF ¶ 76; C. Defs.’ SOF ¶ 155.) On July 26, 1999, after Emerald had issued the stock certificates, the IGB responded to McQuaid’s letter. (PX521 at .43.) The IGB explained that Emerald did not need approval to adopt the Restricted Stock Award Plan, but did need to obtain IGB approval prior to transferring any ownership interests. (PX521 at 43.) IGB Rule 235(a) only permits the transfers of ownership interests in a gaming license “with leave of the Board.” 86 III. Admin. Code § 3000.235(a). Furthermore, any individual shareholder of a company with a gaming license must submit an application, called a Personal Disclosure Form 1 (“PDF 1”) so that the IGB can investigate and determine the “suitability” of the prospective shareholder. 86 III. Admin. Code § 3000.235(a)(1). The IGB recommended that the stock be put in escrow until the IGB had approved the shareholders. (PX521 at 43.) The IGB never approved the Defendants as shareholders. (C. Defs.’ SOF ¶ 251.)

Instead of waiting for IGB approval, Emerald began treating Officer Defendants as all other existing shareholders. They were each issued certificates for their stock. (PX521 át 14, 22, 26, 30, 34; Trustee’s SOF ¶ 76.) Defendants assert that the shares were held in escrow, but admit that they were not held by a neutral third party; instead, they were held in Hanley’s own office. (C. Defs.’ SOF ¶ 251; see also Bankr.Tr. 2745:19-2746:24 (Han-ley testifying that the “corporation held the shares”).) Practically speaking, Han-ley was therefore holding his own shares in “escrow.” Hanley testified at the bankruptcy trial that he does not believe that “escrow” means third-party escrow. (Bankruptcy Tr. 2744:13-47:11; C.. Defs.’ SOF ¶ 319.) Officer Defendants were also allowed to attend shareholder meetings and vote their shares. (Trustee’s SOF ¶ 81; C. Defs.’ SOF ¶ 160 (acknowledging that Restricted Stock Plan participants would be allowed to vote their shares).) They also entered into the same Amended Shareholders’ Agreement on August 6, 1999 that existing shareholders, including Donald Flynn and Peer Pedersen, had signed. (PX1008 at 36, 39-41, 43.) The parties do not dispute that Donald Flynn and Peer Pedersen are Emerald shareholders. (See PX880 ¶ 406; Donald F. *68 Flynn Estate’s Proposed Findings of Fact & Conclusions of Law [247], hereinafter “D. Flynn’s SOF,” ¶¶ 275-79.) In all material respects, McMahon, Larson, McQuaid, Kevin Flynn and Hanley were treated as shareholders, as well, despite lacking IGB approval.

The Amended Shareholders Agreement, signed by all Defendants, updated the provision in the original Shareholders’ Agreement that required shareholders to comply with IGB Rules:

Each Shareholder shall cooperate with the Corporation to provide any disclosure information to the IGB and take any actions necessary to secure the renewal of the Corporation’s gaming license. Each Shareholder further agrees to comply with the Act and all rules and orders of the IGB and shall not commit any acts which would jeopardize the license or a renewal thereof.

(PX1008 at 33 ¶ 10.) Prior to finalizing the Amendments, Emerald’s General Counsel, Walter Hanley consulted outside counsel from two law firms for advice on making amendments to the original Shareholders’ Agreement. (C. Defs.’ SOF ¶¶ 240-42.) One, of these attorneys, Thomas Brett, testified that “it was important to include paragraph 10 because the operations of Emerald are going to be regulated by the IGB.” (Bankr.Tr. '2435:12-21.) Officer Defendants nevertheless now assert that they are not bound by the Shareholders’ Agreement because, absent IGB approval, they never became shareholders under the Agreement. (C. Defs.’ SOF ¶¶ 249-53.). The Trustee contends that Defendants were indeed bound; they consistently represented themselves as shareholders after signing the Amended Shareholders’ Agreement, and Emerald consistently treated Defendants as shareholders. (Trustee’s SOF ¶¶ 81-88.)

E. An unfortunate association: Emerald relocates in Rosemont

The new team installed by Donald Flynn in June of 1999 began to take significant steps towards building a casino in Rose-mont almost immediately after Section 11.2 became law. On June 30, only five days after the Governor signed Public Act 91^40 into law, Joseph McQuaid sent , a letter to the Village of Rosemont, requesting approval to relocate Emerald. (PX307 at 3; Trustee’s SOF ¶ 131.) Mayor Donald Stephens replied the same day, stating that Rosemont would be pleased to welcome Emerald. (PX307 at 4; Trustee’s SOF ¶ 133; C. Defs.’ SOF ¶ 174.) On July 7, 1999, the Village of Rosemont officially approved the relocation of the casino. (PX307 at 6-10; Trustee’s SOF ¶ 133; C. Defs.’ SOF ¶ 174.)

Defendants proceeded promptly to negotiate with Rosemont and initiate construction. As they read the language of Section 11.2 of the Riverboat Gambling Act, the use of the word “shall” in that provision meant that the IGB was required to grant the renewal application for the new location immediately once Emerald acquired approval from the new municipality. (C. Defs.’ SOF ¶ 148.) Defendants also took note of Section 7(e) of the Riverboat Gambling Act, which provides: “the Board may revoke the owners’ license of a licensee which fails to begin conducting gambling within 15 months of receipt of the Board’s approval of the application if the Board determines that license revocation is in the best interests of the State.” 230 ILCS 10/7(e). Although the statutory language implies that the 15-month clock starts upon IGB approval, Defendants, reading these two provisions together, assert that they believed the 15-month period would begin to run as soon as Emerald submitted its application to the IGB for renewal and relocation. (C. Defs.’ SOF ¶¶ 162-64.) *69 Larson also believed, based on his prior experience with the IGB, that the IGB would want Emerald to start making progress on the casino project as soon as possible in order to generate jobs and tax revenues. (C. Defs.’ SOF ¶ 168.)

The IGB spent several months revising the renewal application form after the passage of Section 11.2 in order to ensure the new form complied with the statute. (C. Defs.’ SOF ¶¶ 225-26.) On September 22, 1999, the IGB sent a copy of the newly-revised renewal application form to Emerald, specifically to Joseph McQuaid in his capacity as Vice President of Emerald. (PX544; Trustee’s SOF ¶ 136; C. Defs.’ SOF ¶ 285.) McQuaid prepared the second Renewal Application, with the assistance of Hanley, Larson, and McMahon. (C. Defs.’ SOF ¶ 287.) On September 24, 1999, Emerald submitted a completed application for renewal of its license and for permission to move to Rosemont. (Trustee’s SOF ¶ 138; C. Defs.’ SOF ¶287.)

Even before Emerald had submitted its Renewal Application, Defendants had been making arrangements with the Village of Rosemont to lease from Rosemont the land on which Emerald wanted to build the casino. (Trustee’s SOF ¶ 362.) From July to December of 1999, Emerald and Rosemont executed several documents, in the form of letters, that memorialized the terms of the lease agreement and allowed Emerald to start construction prior to finalizing that agreement. (PX192; PX365; PX367; PX377; PX380.) Emerald did not disclose these documents, created between July and December 1999, to the IGB until December 5, 2000. (PX1106; Trustee’s SOF ¶ 403.) Defendants contend Emerald was not obligated to disclose them earlier because these documents were not binding or final agreements. (C. Defs.’ SOF ¶ 305.) The IGB, however, ultimately concluded that Emerald had violated regulations by failing to disclose the draft agreements. (PX162 at 13-14.) Emerald and Rosemont executed a final Lease and Development Agreement on February 10, 2000 and did send a copy of that final agreement to the IGB, but did not ever obtain IGB prior approval. (PX188; Trustee’s SOF ¶¶ 392, 394; C. Defs.’ SOF ¶ 568.)

Emerald and Rosemont quickly began construction activities at the Rosemont site. Site clearing started in July and August 1999 (C. Defs.’ SOF ¶ 227), and actual construction activities began in October of 1999. (Trustee’s SOF ¶ 477; C. Defs.’ SOF ¶¶ 383, 385) (citing DX782-84, DX786, DX788-89, DX791, photographs taken of the construction site at this time.) In order to complete this construction work, Emerald reached out to and entered into contracts with various construction companies, architects, and contractors. Some meetings occurred even before the legislation was passed. (Trustee’s SOF ¶ 421.) After its passage, from June 1999 through January 2000, several of the Defendants, including Kevin Flynn, John McMahon, Joseph McQuaid, Kevin Larson, and Walter Hanley attended meetings with various companies and authorized contracts to perform construction, engineering, and architectural services. (Trustee’s SOF ¶¶ 421-440.)

The Trustee alleges that Emerald failed to disclose these construction agreements to the IGB, despite the fact, that McQuaid, Hanley, and McMahon attended several meetings with IGB staff and received several requests for disclosures of construction agreements between September 30, 1999 and January 25, 2000. (Trustee’s SOF ¶ 441.) Defendants claim that they disclosed the construction agreements when they submitted the Renewal Application on September 24, 1999. (C. Defs.’ SOF ¶ 304.) The Renewal Application dis *70 closed that Emerald had “engaged” several contractors, but McQuaid, who submitted it, did not include (1) an existing letter of intent that Emerald had executed with Aria Construction, (PX222 at 3; PX224 at 1), or (2) any documents that showed that two other contractors had performed services and that Emerald had incurred costs. (PX245 at 8; PX402.) The IGB found that merely disclosing that Emerald had “engaged” these contractors was insufficient and concluded that Emerald violated IGB rules by failing to disclose the actual agreements. (PX162 at 31-32; PX418 at 54.) On January 31, 2000, after several rounds of requests from the IGB and unsatisfying disclosures by Hanley and McQuaid, the IGB sent Emerald a broadly-worded request for “all written and/or oral contracts, arrangements, work orders, change orders, engagements, hires, commissions of work, requests for performance, exchanges of mutual promises, letters of intent, etc. entered into since July 1, 1999 by Emerald Casino, Inc.,” and specifically draft agreements. (PX72 at 1.) Hanley, with the assistance of McQuaid, responded in a letter dated February 14, 2000, enclosing a list of “completed written agreements,” “agreements not yet fully executed,” and “other agreements.” (PX405 at 10-11; Trustee’s SOF ¶ 444; C. Defs.’ SOF ¶ 423.) Even in this communication, however, Hanley and McQuaid failed to disclose' arrangements with several subcontractors. (PX405 at 10-11.)

To provide financing for the expenses associated with constructing the casino, Emerald began to sell more shares. (C. Defs.’ SOF ¶ 257.) In August and September 1999, Emerald sold stock to female and minority shareholders as called for by Section 11.2(b) (the “Statutory Investors”) with unanimous Board approval. (Trustee’s SOF ¶¶ 603, 610; C. Defs.’ SOF ¶ 257.) Joseph McQuaid was responsible for identifying the proposed Statutory Investors. (C. Defs.’ SOF ¶ 260.) The Trustee contends that Pedersen was involved in preparing the documents necessary to effectuate the sales, (Trustee’s SOF ¶ 607), and that Kevin Flynn also met with some of the Statutory Investors. (Trustee’s SOF ¶ 609.) Defendants deny Kevin Flynn’s involvement. (C. Defs.’ SOF ¶ 271.) Pedersen’s involvement appears to be limited to directing one of the attorneys working at his law firm, Thomas Brett, to draft the stock purchase agreements. (Trustee’s SOF ¶ 607; Pedersen’s SOF ¶ 34.) Although the agreements called for Emerald to return the Statutory Investor’s purchase price if the IGB did not approve the investor, Emerald immediately spent the funds it received from the sales of shares, using those funds to pay for the design and construction of the Casino. (Trustee’s SOF ¶603; C. Defs.’ SOF ¶¶259, 265.) Defendants maintain that this plan to spend the funds immediately was properly disclosed to the IGB on several occasions, including in the Statutory Investors’ applications to the IGB; in letters from Emerald to the IGB in August and early September 1999; in the September 24, 1999 Renewal Application; and at meetings with the IGB between July and October 1999. (C. Defs.’ SOF ¶¶ 266-68.) Although the Statutory Investors began submitting applications to the IGB in August and September 1999, the IGB never approved any of Statutory Investors. (C. Defs.’ SOF ¶ 269.) There is evidence that the IGB never even began their investigations of the Statutory Investors. (C. Defs.’ SOF ¶ 284.)

F. The IGB doggedly investigates Emerald

After receiving the Renewal Application from Emerald on September 24, 1999, the IGB conducted an investigation of Emerald that continued for the next 16 or 17 *71 months. (Trustee’s SOF ¶ 139; C. Defs.’ SOF ¶284.) The IGB’s Administrator, Sergio Acosta, who began that position in July 1999, oversaw the investigation. (Trustee’s SOF ¶ 140.) Prior to serving as the IGB Administrator, Acosta had been an Assistant United States Attorney in Chicago, working in the Organized Crime Division, from July 1990 to July 1999. (C. Defs.’ SOF ¶ 217.) Acosta returned to the United States Attorney’s Office in September 2001. (Bankr.Tr. 309:18-22.) In early 2000, the IGB underwent additional changes in leadership. Gregory Jones, also a former Assistant United States Attorney, became the IGB Chairman. (C. Defs.’ SOF ¶ 448.) James Wagner, a 30-year veteran of the FBI, and former head of the FBI’s Organized Crime Section in Chicago, became the IGB’s new Deputy Administrator of Investigations. (C. Defs.’ SOF ¶ 450.) The new administration had serious concerns about Emerald’s intention to relocate to Rosemont because of Acosta’s belief that Rosemont officials had connections to organized crime. (C. Defs.’ SOF ¶ 645-50.)

During its investigation, the IGB focused on the extent of the construction in Rosemont. On February 22, 2000, the IGB adopted a resolution requiring Emerald to submit to the IGB Administrator a memorandum explaining “a) the reasons the company has failed to comply with the requirements set forth under the River-, boat Gambling Act and Board Rules; and b) the reasons the company should not be required to immediately cease and desist construction in Rosemont.” (PX858 at 755-56; C. Defs.’SOF ¶ 461.) On February 24, 2000 Emerald’s Board unanimously decided to suspend construction activities in Rosemont until Emerald received IGB approval of its application for renewal and relocation. (C. Defs.’ SOF ¶ 466.)

After an extensive investigation of Em- . erald, its directors, officers, and other key persons, on January 30, 2001, IGB voted (1) to deny Emerald’s Renewal Application and (2) to revoke Emerald’s license. (PX135 at 35-37; Trustee’s SOF ¶ 141: C. Defs.’ SOF ¶ 706.) On March 6, 2001, the IGB issued its formal notice of nonrenewal and filed a five-count Complaint for Disciplinary Action against Emerald to revoke Emerald’s license. (PX151; Trustee’s SOF ¶ 144; C. Defs. SOF ¶ 714.) Emerald answered the Disciplinary Complaint on March 26, 20.01, denying any IGB rule violations. (PX41; Trustee’s SOF ¶ 145; C. Defs.’ SOF ¶ 715.) The administrative hearing on the Disciplinary Complaint began on May 29, 2002 (Trustee’s SOF ¶ 148; C. Defs.’ SOF ¶ 744), but was swiftly brought to a halt on June 13, 2002, when certain of Emerald’s creditors filed an involuntary Chapter 7 bankruptcy proceeding. (Trustee’s SOF ¶ 148; C. Defs.’ SOF ¶ 802.)

Shortly after the bankruptcy proceedings began, on August 26, 2002, Emerald’s Board voted to “terminate[ ]” several Defendants from their positions as officers and employees of Emerald including Kevin Flynn, Kevin Larson, Walter Hanley, and Joe McQuaid. 6 (PX1316 at 214.) At that point, and for the bulk of the bankruptcy proceeding, John McMahon was Emerald’s only employee and officer. 7 (Trustee’s SOF ¶ 3; see also PX1316 at 214 (McMahon is appointed as the registered agent.).) Donald Flynn was elected Chairman of the Board. (PX1316 at 214; Trustee’s SOF ¶22.) The decision to terminate Emer- *72 aid’s remaining officers and employees may have been a function of an attempted settlement agreement with the IGB. (See PX1316 at 214) (Board vote to terminate officers occurred after discussion of Emerald’s “obligations under the settlement agreement ... to develop a plan for operations going forward.”)

Both before and during the administrative hearings and bankruptcy proceeding, Emerald attempted to challenge the IGB’s action in state court. 8 On May 21, 2001 Emerald filed suit challenging the IGB’s authority to deny its Renewal Application on the ground that Section 11.2 used mandatory language. See Emerald Casino, Inc. v. Ill. Gaming Bd., 346 Ill.App.3d 18 , 281 Ill.Dec. 293 , 803 N.E.2d 914 (Ill.App.Ct. 1st Dist.2003). While the administrative hearings were paused and bankruptcy proceedings were pending, the Illinois Appellate Court ruled in favor of Emerald on that issue. On December 30, 2003, the First District Appellate Court concluded that the word “shall’^ in Section 11.2 required the IGB to grant Emerald’s Renewal and Relocation Application. Emerald Casino, 346 Ill.App.3d at 32 , 281 Ill.Dec. 293 , 803 N.E.2d 914, 926-28 . The Illinois Appellate Court held, however, that the IQB retained the authority and discretion to pursue revocation proceedings. Id. On May 25, 2005, after Emerald and the IGB failed to reach a settlement, the revocation proceedings resumed with the Honorable Abner Mikva serving as the Administrative Law Judge. (Trustee’s SOF ¶ 149; C. Defs.’ SOF ¶ 769.) Om November 15, 2005, Judge Mikva issued his determination, recommending that the IGB revoke Emerald’s license, based on his findings that Defendants had dissembled about plans to move to Rosemont; had improper connections to organized crime; had failed to disclose: (1) Kevin Flynn’s role in managing Emerald, (2) various agreements to sell shares of stock, and (3) agreements with Rosemont and construction professionals; and finally, that the “operation of gaming by Emerald in Rosemont would greatly undermine ‘public trust and confidence in that credibility and integrity of the gambling operations and of regulatory process’ in Illinois,” (PX1231 at 38-39; Trustee’s SOF ¶ 150; C. Defs.’ SOF ¶ 770.) On December 20, 2005, the IGB issued a final administrative order revoking the license, largely adopting Judge Mikva’s findings. (Trustee’s SOF ¶ 151; C. Defs.’ SOF ¶ 770.)

G. The IGB revokes Emerald’s license

The IGB’s Final Board Order listed five Counts against Emerald. (PX162 at 32-37.) The conduct that IGB took issue with falls generally into three categories: (1) Emerald’s attempted relocation of the casino to Rosemont; (2) Emerald’s failure to seek IGB approval or keep the IGB informed of key decisions; and (3) Emerald’s failure to obtain pre-approval for transfers of Emerald shares.

• Emerald’s attempted relocation of the casino to Rosemont

The IGB found that Emerald violated several IGB Rules in its efforts to relocate to Rosemont. Specifically: (a) Emerald failed to disclose agreements between Emerald and Rosemont, which were purportedly entered into prior to the passage vof Section 11.2 (PX162 at 33); (b) Emerald failed to disclose construction agreements between Rosemont and Emerald entered into after the passage of Section 11.2 (Id.); (c) the terms of the final Lease.and Development Agreement between Emerald and Rosemont violated IGB rules by allowing *73 Rosemont to “waive” certain IGB requirements and by committing Emerald to fund a parking garage when it did not have sufficient financing (Id. at 34); and (d) Emerald allowed a construction company with known ties to organized crime to work on the site and allowed individuals with associations to organized crime to purchase stock in Emerald. (Id. at 36.)

• Emerald’s failure to seek IGB approval or keep the IGB informed of key decisions

The IGB concluded that Emerald failed to inform the IGB about Kevin Flynn’s involvement in management prior to his appointment as CEO in 1999. (PX162 at 33, 36.) Emerald also failed to inform IGB of construction agreements or keep the IGB informed of the status of construction activities in Rosemont. (PX162 at 33, 36.)

• Emerald’s failure to obtain IGB pre-approval for transfers of shares of Emerald

The IGB identified several transactions for which Emerald did not obtain IGB pre-approval, including transfers to Emerald insiders, to minority and female investors (“Statutory Investors”), and to outside non-statutory investors. (PX162 at 33-36.) The IGB also cited Emerald for unauthorized transfers of stock to public officials. (PX162 at 11) (identifying one shareholder as a relative of State Representative Ralph Caparelli and “two other public officials.”) The other two public officials appear to be Susan Leonis, who was Vice Chairman of the Board of the Chicago Transit Authority (Trustee’s SOF ¶¶ 645-16), and Robert Martwiek who was the Norwood Park Township Democratic Committeeman and whose son, Robert Martwiek, Jr. was the Trustee for the Village of Norridge. (Trustee’s SOF ¶¶ 651-52.)'

The IGB Final Board Order found that Emerald violated five IGB rules:

• 110(a): A holder of any license shall be subject to imposition of fines, suspension or revocation or restriction of such license, or other disciplinary action for any act or failure to act by himself or by his agents or employees that is injurious to the public health, safety, morals, good order and general welfare of the people of the State of Illinois, or that would discredit or tend to discredit the Illinois Gaming industry or the State of Illinois. Without limiting the foregoing, the following acts or omissions may be grounds for such discipline ....

(5) Associating with, either socially or in business affairs, or employing persons of notorious or unsavory reputa-' tion or who have extensive .police records, or who have failed to cooperate with any officially constituted investigatory or administrative body and would adversely affect public confidence and trust in Gaming.

• 140(a) Board licensees and applicants for licenses issued by the Board shall have' a continuing duty to disclose promptly any material changes in information provided to the Board. The duty to disclose changes in information shall continue throughout any period of licensure granted by the Board. Board licensees or applicants for licenses must maintain current release of information forms as originally submitted to the Board.

• 140(b): In addition to and without limiting disclosure of changes of information required under subsection (a), licensees and applicants for licen-sure shall periodically disclose changes in or new agreements, whether oral or written, relating to:

(3) Construction contracts....

(7) Agreements to sell, grant, gift pledge, hypothecate or otherwise *74 transfer or share an ownership interest or interests in a holder of an Owner’s License.

• 235(a): An ownership interest in an entity with a finding of preliminary suitability or a holder of an Owner’s license may only be transferred with leave of the Board. An ownership interest in a business entity, other than a publicly traded corporation, which has an interest in an entity with a finding of preliminary suitability or in a holder of an Owner’s license, may only be transferred with leave of the Board.

But the IGB concluded that violation of any one of the rules would have been sufficient to support the revocation of the license. (PX162 at 32.)

H. Procedural History

Emerald returned to the Illinois courts, seeking judicial review of the IGB’s Final Board Order in the Illinois Appellate Courts. (Trustee’s SOF ¶ 152.) This time, Emerald’s efforts were less successful. On May 30, 2007, the Illinois Appellate Court affirmed the IGB’s Final Board Order, though it concluded that the findings relating to organized crime were “against the manifest weight of the evidence.” 9 (Emerald Casino, Inc. v. Ill. Gaming Bd., No. 4-06-0051, 105, 372 Ill.App.3d 1106 , 346 Ill.Dec. 310 , 940 N.E.2d 310 (Ill.App.Ct. 4th Dist. May 30, 2007), hereinafter “PX1233.”) Emerald petitioned for leave to appeal, but on November 29, 2007, the Illinois Supreme Court refused to hear the case, making the revocation final. Emerald Casino, Inc. v. Vill. of Rosemont, 226 Ill.2d 582 , 316 Ill.Dec. 542 , 879 N.E.2d 930 (Table) (Ill.2007).

The bankruptcy action commenced on June 13, 2002, when certain creditors filed an involuntary petition. (Involuntary Petition, In re: Emerald Casino Inc., Debtor, No. 02-22977[1].) On September 10, 2002, the action was converted to a Chapter 11 proceeding. (Order Converting Chapter 7 to Chapter 11 and an Order for Relief Under Chapter 11, In re: Emerald Casino Inc., Debtor, No. 02-22977[113].) Years later, on March 19, 2008, the bankruptcy action was converted back to a Chapter 7 (Order Converting Case Under Chapter 11 To Case Under Chapter 7, In re: Emerald Casino Inc., Debtor, No. 02-22977 [1985]), *75 and the Trustee was appointed. (Letter of Appointment, In re: Emerald Casino Inc., Debtor, No. 02-22977 [1984].) Over several weeks in 2010, Judge Wedoff of the Bankruptcy Court heard evidence on the Trustee’s claims against these Defendants, but never issued findings of fact or conclusions of law, and on January 31, 2012 this court withdrew the reference. See In re Emerald Casino, Inc., 467 B.R. 128 (N.D.Ill.2012). This court has now reviewed the record from the bankruptcy proceeding, and heard additional evidence as well.

II. A casino in Rosemont

The IGB found that Emerald violated IGB Rules 140(a), 140(b)(3), and 110(a) by withholding information about its efforts to relocate its license to Rosemont. First, the IGB found that Emerald began making efforts to relocate to Rosemont — including an agreement to split ownership interests in a Rosemont casino with the Mayor of Rosemont and two interested investors — before the legislation allowing relocation had passed. The IGB found the alleged pre-legislation agreement violated IGB rules because Emerald failed to disclose the agreement to the IGB. Second, the IGB further found that once the legislation passed, Emerald repeatedly failed to disclose its decision to move to Rosemont and failed to keep the IGB fully informed of (1) its agreements with the Village of Rosemont and (2) the status of construction on the new site. IGB Rules 140(a) and 140(b)(3) and (7) specifically require gaming licensees to disclose these agreements. Finally, the IGB found that the terms of one of the agreements Emerald executed with the Village of Rosemont violated IGB rules.

A. Emerald lays the groundwork to move to Rosemont

The parties dispute when Emerald decided to relocate the casino to Rosemont and whether any of Defendants made an agreement with the Village of Rosemont to relocate. Defendants maintain that Emerald did not consider Rosemont a viable site until after the legislation passed. (C. Defs.’ SOF ¶ 130.) The Trustee alleges, and the IGB concluded, that Emerald in fact made the decision to relocate to Rose-mont long before the legislation passed and entered into a secret agreement with the Mayor of Rosemont and other interested investors. (Trustee’s SOF ¶ 330.) The IGB inferred the existence of an agreement from several circumstances: (1) Kevin Flynn met in 1997 with Mayor Stephens (PX162 at 7-8); (2) Kevin Flynn and Joseph McQuaid met with representatives of the Davis Companies and Duchossois Industries and, according to the IGB, made deals to sell interests in Emerald (PX162 at 8-9); (3) Emerald, the Davis Companies, and Duchossois Industries engaged in joint lobbying efforts after December 1, 1998 (PX162 at 9); (4) the Davis Companies, Duchossois Industries, certain Defendants, and other Emerald contractors made contributions to Mayor Stephens’ campaign fund in October 1999 (PX162 at 10); and (5) the fact that “[everybody else seemed to know,” even before passage of the legislation, that Emerald’s license was going to Rosemont. (PX162 at 9-10.) From this, the IGB concluded that Kevin Flynn, on behalf of Emerald, had entered into an agreement to relocate to Rosemont and to “divide the pie” without disclosing the agreement to the IGB, in violation of Rules 140(a) and 140(b)(7) which require disclosure and IGB approval of such agreements.

1. Kevin Flynn met with Mayor Donald Stephens in 1997

The Trustee alleges that efforts to relocate to Rosemont began in 1997. Some *76 time in 1997, Isaac Degen, a Mend of Mayor Stephens and principal of Degen & Rosato Construction Company, and Victor Casini, an attorney at Flynn Enterprises, arranged a meeting between Mayor Stephens and Kevin Flynn. (Trustee’s SOF ¶¶ 208, 210-11, 213-14; C. Defs.’ SOF ¶ 614.) The parties dispute what was discussed at the meeting. While the Trustee asserts, and the IGB concluded, that Kevin Flynn and Mayor Stephens “discussed the possibility of moving the Emerald operation to Rosemont,” (Trustee’s SOF ¶ 208; see PX162 at 16), Defendants maintain that Kevin Flynn requested the meeting because he had heard Mayor Stephens was interested in lobbying for legislation that would allow Rosemont to open a new land-based casino (and not one requiring a waterway), and Kevin Flynn wanted an opportunity to manage a land-based Rose-mont casino if Mayor Stephens was successful in that effort. (C. Defs.’ SOF ¶ 614.)

Attorney Casini testified that the purpose of the 1997 meeting was to introduce Kevin Flynn to Mayor Stephens because “Kevin Flynn had just completed developing this world-class casino in Indiana” and “[i]t was common knowledge that the may- or of Rosemont was interested in a casino in Rosemont.” (Bankr.Tr.2088:l-8.) Ca-sini denied that the meeting was intended to obtain Mayor Stephens’ support for Emerald’s relocation. (Bankr.Tr.2088:9-16.) Isaac Degen, who also was present, testified that “the best [he] recall[s],” is that Kevin Flynn and Mayor Stephens discussed “maybe a license from Galena for a casino coming to — possibly one of the locations was the Village of Rosemont.” (Bankr.Tr. 1874:25-1875:3.) Degen did not recall hearing Kevin Flynn discuss the Blue Chip Casino. (Id. 1875:8-12.) Casini testified that he did not recall any specific statements concerning the Blue Chip or-Emerald’s possible relocation to Rosemont. (Bankr.Tr.2073:19-2075:4.)

Both at trial and -in earlier statements to the IGB, Kevin Flynn maintained that he and Mayor Stephens only discussed Blue Chip at the meeting, and not Emerald’s possible relocation of the Silver Eagle operation to Rosemont. (PX1095 at 110 (“The whole notion of Rosemont was not anything that was considered as far as I know until the legislation [allowing relocation] passed.”); PX1222 at 31-33 (IGB Disciplinary Proceeding); Bankr.Tr. 3307:12-3309:3; Tr. 2358:2-21.)

Citing an internal memorandum written by Stephen J. O’Neil, a Bell, Boyd & Lloyd attorney retained by Emerald for. representation in the Davis litigation, described below, the Trustee asserts that Kevin Flynn’s testimony, denying any discussion of relocating the Emerald license to Rose-mont, is not credible. (Trustee’s SOF ¶ 219) (citing PX651 (dated 11/22/99).) The memorandum purports to summarize a November 17, 1999 interview with Kevin Flynn and Joseph McQuaid, and tracks the history of Mayor Stephens’ interest in a Rosemont casino. The parties dispute the accuracy of the mémorandum. The Trustee observes that Defendants had “less ... motive to lie” when talking to their own attorneys. (Trustee’s SOF ¶ 255.) Defendants maintain that the memorandum is unreliable because the attorney was hearing the facts for the first time, from five individuals. (C. Defs.’ SOF ¶ 529.) Furthermore, the memo was written five days after the meeting and according to the attorney who prepared the memo was “likely based on no notes or sketchy notes.” (C. Defs.’ SOF ¶ 529) (quoting Bankr.Tr. 1339:9-11.) The memo observes that: “Stephens was not, however, interested in having Davis obtain a gaming license. He was looking for a municipal license, not a relocation of the' existing *77 license.” (PX651 at 1.) According to the • memo, Stephens was looking for a new license so he could pick the management company himself. As the memo notes: “There was some discussion of a land-based casino but Stephens wanted a major, well-known management company. Stephens wanted ownership of the license in accordance with the following priorities: 1) Rosemont ownership; 2) State ownership; 3) ownership by a Stephens-designated developer.” (Id. at 2.) Kevin Flynn testified that Mayor Stephens was not interested in having “local” management, instead, May- or Stephens told Kevin Flynn, “[t]he only thing that I need to determine is whether it’s MGM or Mirage or Harrah’s.” (Tr. 2358:7-16.)

The IGB concluded that “Kevin Flynn lied” concerning the purpose of his meeting with Mayor Stephens. (PX162 at 16.) The version of events set forth in O’Neil’s memorandum, however, is not inconsistent with Kevin Flynn’s testimony that Mayor Stephens was only interested in a land-based casino (and thus, not interested in Emerald’s license for a casino on a waterway), and that Kevin Flynn was seeking the opportunity to manage a land-based casino for Rosemont in the event that an amendment to the Riverboat Gambling Act allowed it.

The court- concludes that the Trustee has failed to present sufficient evidence to conclude what exactly was discussed at the meeting in 1997. It appeared to be common knowledge that Mayor Stephens was interested in a land-based casino in Rose-mont, and while Kevin Flynn admits that he attended the meeting and that he briefly discussed gaming with Mayor Stephens, he emphasizes that the meeting concerned Blue Chip, and not relocating Emerald’s license. This account is consistent with the account in the O’Neil memorandum, in which Kevin Flynn reportedly told his attorneys at Bell, Boyd & Lloyd that Mayor Stephens was interested only in a land-based casino, and that this was discussed at the 1997 meeting. And, while Degen and Casini admit to arranging the meeting, Casini cannot recall what' was discussed (Bankr.Tr.2073:19-2075:4), and Degen (the only witness to testify that relocation was discussed) appears to. be uncertain of the accuracy of his own testimony. (Bankr.Tr. 1874:25-1875:3.) There is insufficient evidence to conclude that Kevin Flynn was acting on behalf of Emerald at the. 1997 meeting with Mayor Stephens or that he attempted to sell an interest in Emerald or make a deal to relocate to Rosemont.

2. The alleged agreement between Emerald, the Davis Companies, and Duchossois Industries

The IGB Final Board Order found that during Emerald’s efforts to relocate, prior, to the legislation passing, Emerald officials made oral agreements to sell ownership interests in a Rosemont casino to Mayor Stephens, and two companies (Davis Companies and Duchossois Industries) but failed to disclose the agreements to the IGB. (PX162 at 8-9,17-19.)

The first meeting between any of the Defendants and the Davis Companies took place in 1997, when Kevin Flynn and Michael Colleran, the Chief Financial Officer for the Davis Companies, met at Presidential Towers in Chicago. (Trustee’s SOF ¶ 249; C. Defs.’ SOF ¶490.) There is conflicting testimony about what was said at the meeting and whether or not Kevin Flynn attempted to sell Emerald’s license. (Trustee’s SOF ¶¶ 253-55; C. Defs.’ SOF ¶¶ 490-92.) But the IGB Final Board Order neither refers to this 1997 meeting nor relies on it in its revocation order, instead finding that the undisclosed agreement was reached in late 1998. (PX162 at 8.) The details of the Presidential Towers meeting are therefore not relevant to de *78 termine whether an agreement between Davis, Duchossois, and Emerald existed.

During the fall of 1998, there were several meetings between certain Defendants and representatives of the Davis'Companies and Duchossois Industries. The parties present significantly different accounts of what happened at these various meetings. The dispute over these meetings has also been the subject of separate litigation between the Davis Companies and Emerald. See Davis Companies, Inc. v. Emerald Casino, Inc., No. 99-C-6822, 2003 WL 22113414 (N.D.Ill. Sept. 11, 2003) (granting Defendants’ motion for summary judgment on breach of contract and civil conspiracy claims and denying Defendants’ motion with respect to fraudulent misrepresentation claim). The Trustee alleges that Kevin Flynn, acting on behalf of Emerald, entered into an agreement with the Davis Companies and Duchossois Industries to sell ownership interests to those companies. (Trustee’s SOF ¶ 257.)

Precisely what Davis and Duchossois purportedly promised in return for the ownership interests in Emerald is not clear. The Trustee seems to adopt the IGB’s suggestion that Davis and Duchos-sois agreed to support Emerald’s lobbying efforts to amend the Riverboat Gambling Act to allow relocation in exchange for an ownership interest in a relocated casino. (PX162 at 8; PX1231 at 7-8; Trustee’s SOF ¶¶ 257-63.) Defendants’ theory is that the ownership interests were instead part of Davis and Duchossois’s proposal to “remedy [Emeraldj’s licensure situation.” (Tr. 559:5-6; C. Defs.’ SOF ¶¶ 496-96.) Specifically, Defendants suggest, Michael Colleran, on behalf of Duchossois Industries, requested that Emerald give up its appeal of the IGB’s revocation order and simply surrender the license, so that the license could be re-issued to Rosemont and the Davis Companies could manage the casino. (Tr. 653:5-16; G: Defs.’ SOF ¶ 497.) In exchange for giving up the license, Emerald would receive a percentage ownership in the new casino. (Tr. 563:14-20; C. Defs.’ SOF ¶497.) Kevin Flynn and Defendants ardently maintain that they did not agree to that proposal or reach any other agreement with Davis and Duchossois. ,(C. Defs.’ SOF ¶¶506, 518-520.)

The parties do agree on a few basic facts. First, on October 28, 1998, Kevin Flynn, Donald Flynn, and Joseph McQuaid met with Richard Duchossois, the owner of Duchossois Industries and Arlington International Race Course. (Trustee’s SOF ¶ 260; C. Defs.’ SOF ¶ 133.) Also present at the meeting was David Filkin, the Executive Vice President and General Counsel at Arlington Park (Trustee’s SOF ¶ 261; C. Defs.’ SOF ¶ 133), and Scott Mordell, President of Arlington Park. (Trustee’s SOF ¶ 262; C. Defs.’ SOF ¶ 133.) At this meeting, the Emerald representatives expressed Emerald’s desire to move its license to a more profitable market. (Trustee’s SOF ¶ 267; C. Defs.’ SOF ¶ 493.) Kevin Flynn expressed that Rosemont would be a great location for a casino, specifically referring to such a move as a “no-brainer.” (Trustee’s SOF ¶ 268; C. Defs.’ SOF ¶ 493.) Defendants also sought to enlist Duchossois in their relocation lobbying efforts and discussed common legislative goals shared by the gaming and horse racing industries. (Trustee’s SOF ¶ 267; C. Defs.’ SOF ¶493.) After the October 28, 1998 meeting, McQuaid met with Duchossois lobbyist, Jim Fletcher, to discuss the specifics of coordinating lobbying efforts. (Trustee’s SOF ¶ 272; C. Defs.’ SOF ¶ 135.)

The parties also agree that on November 20,1998, Michael Colleran and Richard Duchossois met to discuss Duchossois’ potential involvement in a Rosemont casino *79 and a “potential percentage interest.” (Trustee’s SOF ¶ 274; C. Defs.’ SOF ¶ 495.) Furthermore, on November 24, 1998, McQuaid met with Davis lobbyist Gene Reineke and Michael Colleran at the Ritz Carlton Hotel. (Bankr.Tr. 2250:21-2251:2; C. Defs.’ SOF- ¶ 496.) Colleran testified that the meeting was at Mayor Stephen’s suggestion. (Bankr.Tr. 2251:5.) At the meeting, Colleran presented a proposal to share ownership interests in a Rosemont casino between the Davis Companies, Rosemont, and “the Flynn family.” (Tr. 563:14-564:3; Trustee’s SOF ¶275.) Everyone agrees that the meeting did not go well. (Trustee’s SOF ¶276. C. Defs.’ SOF ¶ 498.) Defendants explain that the meeting did not end amicably because Col-leran proposed that Emerald surrender its license, so that the IGB could re-assign it to the Village of Rosemont. (Tr. 562:25-564:7; C. Defs.’ SOF ¶ 497.) Colleran proposed that Rosemont would then enlist Davis to run the casino and “the Flynns” could have a 10% interest. (Bankr.Tr. 3422:2-14; C. Defs.’SOF ¶ 497.) McQuaid thought this proposal was “ludicrous” because the IGB “doesn’t award a license to a municipality. The municipality doesn’t pick the operator.” (Tr. 564:6-11.) Furthermore, Emerald would be left with the $30 million in debt it had at that time and, without the license, would have no way to recover the lost amount. (Tr. 564:12-16.)

The next day, November 25, 1998, McQuaid, Colleran, and Mayor Stephens met at a coffee shop in Rosemont. (Trustee’s SOF ¶¶ 277-278; C. Defs.’ SOF ¶ 499-500.) This is where the parties’ accounts radically diverge. Colleran testified that State Representative Ralph Capparelli, whose district included the Rosemont area, was also at the meeting for part of the time. (Bankr.Tr. 2253:6-10, 2255:2-6.) The Trustee asserts, based on Colleran’s account, that Mayor Stephens successfully brokered a deal between McQuaid and Colleran regarding joint ownership of a Rosemont casino. (Bankr.Tr. 2254:7-18; Trustee’s SOF ¶ 280-81.) As Colleran reported, he and McQuaid reached an agreement about specific percentage splits in ownership. (Bankr.Tr. 2254:10-18.) Emerald and Davis would each receive a 37.5% interest, with 20% reserved for Duchossois, and 5% for local investors. (Bankr.Tr. 2254:14-15; Trustee’s SOF ¶¶ 280-81.) Colleran believed that the Mayor would designate the local investors who would receive the 5%. (Bankr.Tr. 2255:10-12.) The IGB, on the other hand, in its Final Board Order, based on the recommendations of ALJ Mikva, concluded that the five percent interest was for the Mayor personally. (PX162 at 18.) The IGB interviewed Mayor Stephens in September 2000 — as part of its extensive investigation of Emerald before it denied Emerald’s Renewal Application. In that sworn interview, Stephens claimed the five percent for local investors “was for me.” (PX162 at 18.)

Defendants, relying primarily on the accounts of McQuaid and Kevin Flynn, insist that no agreement was ever reached. McQuaid testified that, although he knew the Mayor and Emerald wanted different things, he met with Mayor Stephens on November 25, 1998 to ensure that Mayor Stephens would not block Emerald’s efforts to seek legislation allowing relocation. (Tr. 567:19-568:22; C. Defs.’ SOF ¶¶ 501-503.) According to McQuaid, Colleran repeated the proposal he had made the night before, but increased the percentage he offered to the Flynns slightly. (Tr. 573:8-16.) McQuaid testified that Colleran asked McQuaid to present the proposal to Donald Flynn (Tr. 573:17-21), and McQuaid admitted that he agreed to do so. (Tr. 574:1-2.) According to McQuaid, the discussion then shifted towards Emerald’s *80 legislative goals, and he and the Mayor quickly realized they had different goals. (Tr. 575:14-17.) The Mayor wanted a land-based casino, while Emerald was. still focused on relocating the riverboat casino. (Tr. 576:4-10.) According to McQuaid, the meeting ended shortly thereafter. (Tr. 576:17-19.) McQuaid was satisfied that he had explained Emerald’s position and had managed to ensure that Mayor Stephens would not block Emerald’s lobbying efforts. (Tr. 577:1-10.)

The parties agree that McQuaid sent Colleran to speak with Kevin Flynn, but disagree about the reason. The Trustee alleges, citing Colleran’s testimony, that McQuaid claimed Kevin Flynn was the only one with authority to enter into a joint ownership deal and McQuaid, therefore, suggested that Colleran meet with Kevin Flynn. (Bankr.Tr. 2254:19-2255:1; Trustee’s SÓF ¶ 282.) Defendants maintain that McQuaid sent Colleran to Kevin Flynn because Donald Flynn was not interested in speaking to Colleran. (Tr. 580:5-15.) McQuaid apparently acted as the go-between for Colleran and Donald Flynn: First, McQuaid called Donald Flynn to report on his meeting with Mayor Stephens and convey Colleran’s proposal about surrendering the license. (Tr. 577:11-578:15.) Donald Flynn was not interested. (Tr. 578:17-19.) When McQuaid called Colleran to let him know that Donald Flynn was not interested in a joint ownership deal, Colleran asked if he might discuss non-gaming interests with Donald Flynn. (Tr. 579:9-16.) McQuaid conveyed that request to Donald Flynn, but Donald Flynn suggested that Colleran speak with Kevin Flynn instead. (Tr. 580:5-15.)

Kevin Flynn and Colleran did meet privately on December 1, 1998. (Trustee’s SOF ¶ 285; C. Defs.’SOF ¶ 504.) Based again on Colleran’s account, the Trustee alleges that this is the meeting at which an agreement to sell ownership interests in Emerald was ultimately reached. (Trustee’s SOF ¶285.) Colleran testified that he and Kevin Flynn discussed the same percentage split he had discussed with McQuaid: 37.5% each for Davis and the Flynns, 20% for Duchossois and 5% for local investors. (Bankr.Tr. 2258:2-5.) Colleran testified that he and Kevin Flynn ended the conversation agreeing, at. Kevin Flynn’s suggestion, to keep the deal confidential. (Bankr.Tr: 2258:8-13, 2259:7.)

Defendants deny that the agreement was reached. (C. Defs.’ SOF ¶¶ 506, 518-520.) By Kevin Flynn’s account, McQuaid had filled him in on Colleran’s proposals before the December 1, 1998 meeting. (Bankr.Tr. 3295:12-13.) At that meeting, Kevin Flynn testified, Colleran did propose a deal in which Emerald would give up its license, the Village of Rosemont would acquire it, and then Davis would take a majority interest, and “the Flynns” would take a minority interest. (Tr. 2641:21-25.) ' Kevin Flynn admitted that Colleran also spoke about a different deal, one in which the Davis Companies and the Flynns would have equal shares and Du-chossois would have a 20% share. (Tr. 2644:14-19.) Kevin Flynn recalled that Colleran also discussed the tax structure of the proposed entity and stated that “the Flynns” could run the day-to-day operations. (Tr. 2646:1-8.) Kevin Flynn testified that he “stopped [Colleran] and said the casino in Rosemont is illegal,” (see Bankr.Tr. 3298:19-20), presumably referencing the ban on gaming in Cook County. In response to Kevin Flynn’s concerns, Colleran said he had already talked to Duchossois about getting a legislative change. (Bankr.Tr. 3298:21-25.) Specifically, Colleran asserted that Duchossois could get it “taken care of, and for that Davis was going to give Duchossois 20 percent of the casino and the Flynns and *81 Marvin [Davis] would have the rest of it to share equally.” (Bankr.Tr. 3298:21-25.) . Kevin Flynn responded that he did not think Emerald would lose its license, but “if for some reason that did happen, that he [Colleran] should call us then.” (Bankr. Tr. 3299:19-22.) But Kevin Flynn testified that he did not make any deal or agreement with Colleran. (Bankr.Tr. 3299:25.)

Immediately after his conversation with Colleran, Kevin Flynn ran into Richard Duchossois and David Filkin, Duchossois’s lawyer, on Michigan Avenue. (Bankr.Tr. 916:1-4; Tr. 2646:9-13.) Kevin Flynn had arranged to meet with the two or them at a nearby restaurant, but was running late. (Bankr.Tr. 952:10-19; Tr. 2464:13-15.) When he saw them on the street, Duchos-sois and Filkin informed Kevin Flynn that they knew- he had just met with Colleran and that they themselves planned to meet Colleran later that day. (Bankr.Tr. 954:3-10; Tr. 2647:9-15.) Kevin Flynn testified that there was no agreement made during this conversation, either. (Bankr.Tr. 3303:9-11; Tr. 2649:5-13.) Later that day, Duchossois, Filkin, and Colleran met at the Ritz Carlton without Kevin Flynn. (Trustee’s SOF ¶ 289; C. Defs.’ SOF ¶ 515.) In his notes from this meeting, Filkin stated that the three men discussed a proposal where Davis and the Flynns would each have a 37.5% interest, Duchos-sois would have a 20%, a 5% interest would be reserved for local investors. (PX55.)

After the meetings in 1998, some of the Defendants began joint lobbying efforts with Duchossois. The Trustee alleges, and the IGB agreed, that these efforts are evidence that a joint ownership agreement was reached in late 1998. (Trustee’s SOF ¶ 294.) The court notes, however, that Joseph McQuaid, who oversaw Emerald’s lobbying activities, attended lobbyist meetings with other representatives from the horse racing and riverboat gambling industries, as well. (Trustee’s SOF ¶ 296; C. Defs.’ SOF ¶¶ 122, 520.) In March or April of 1999, Kevin Flynn, Richard Du-chossois, and Jim Fletcher, one of Duchos-sois’s lobbyists, flew in Duchossois’s helicopter to Springfield, where Kevin Flynn and Duchossois met with representatives from the horseracing and gaming industries. (Tr. 2658:15-17, 2660:17-20; Trustee’s SOF ¶ 299.) Thus, as Defendants assert, gaming and horseracing interests acted as political allies in a joint effort to get legislation passed. (C. Defs.’ SOF ¶ 520.) And, although Duchossois and representatives from Emerald worked together on lobbying, it does not appear that the Davis Companies had a large role. The only evidence the Trustee presents on the Davis Companies’ involvement is that Kevin Flynn met with Colleran on February 9, 1999 (Trustee’s SOF ¶ 295), but there is no specific evidence of what was discussed at the meeting, (see Bankr.Tr. 965:18-966:3.)

Notably, the Davis Companies filed a breach of contract action to enforce the alleged deal on October 18, 1999. (Trustee’s SOF ¶ 319; C. Defs.’ 'SOF ¶¶321, 524.) Judge Ronald Guzman of this court ultimately granted summary judgment on the-, breach of contract claim in favor of Defendants in that case. See Davis Corporation, Inc. v. Emerald Casino, No. 99-c6822, 2003 WL 2213414 (N.D.Ill. Sept. 11, 2003). 10

This court concludes that there is insufficient evidence that an . agreement be *82 tween Davis, Duehossois, and Emerald was reached on December 1, 1998. Kevin Flynn, McQuaid, and Colleran all acknowledged that various joint ownership arrangements were proposed and discussed. Yet the only evidence that Kevin Flynn actually agreed to the deal is Colleran’s testimony to that effect. The agreement was never reduced to writing, which appears inconsistent with Defendants’ past practice; on November 14, 1997, Emerald and Lake County had Riverboat entered into a written “agreement in principle,” to make reasonable efforts to relocate Emerald’s license to Lake County if an amendment allowing Emerald to relocate its license passed in the 1997 veto session. (Trustee’s SOF ¶226; C. Defs.’ SOF ¶ 625.) Because the legislation did not pass in 1997, that agreement never came to fruition. The Trustee emphasizes that Attorney Filkin prepared contemporaneous notes of the conversation between Du-chossois and Colleran in the evening of 1998, and those notes corroborate the existence of the agreement — but they do not support the assertion that Kevin Flynn agreed to the terms. (PX55; Trustee’s SOF ¶ 290.) The fact that the parties engaged in joint lobbying efforts does not by itself establish the existence of an agreement. The evidence is also consistent with Defendants’ assertion that the horse racing and gaming industries were working together on mutually beneficial legislation.

The Trustee presents several other pieces of evidence to show that Emerald did enter into an agreement with Davis and Duehossois. First, the Trustee points with suspicion at contributions that Emerald, the Davis Companies, and the Duchos-sois Industries all made to Mayor Stephens’ campaign fund in October 1999. (PX162 at 9-10; Trustee’s SOF ¶ 352.) The IGB concluded that “it is reasonable to infer from these contributions, their timing and the lobbying efforts acknowledged by the parties involved, that there was an agreement in 1998-99 to get legislation passed to relocate the Emerald gaming operations to Rosemont and to divide the pie in some kind of secret agreement.” (PX162 at 10.)

This court respectfully disagrees. The contributions were made in October 1999, well after the legislation passed on May 25, 1999, and after the Governor signed it into law on June 25, 1999. By October, Rose-mont had already accepted Emerald’s request to relocate to Rosemont under the terms of the legislation. (Trustee’s SOF ¶ 132; .C. Defs.’ SOF ¶ 174.) Contributions made months after the legislation allowing relocation had passed do not readily support the inference that there was a secret agreement to relocate and divide ownership of a casino in 1998, prior to the legislation’s passage. Furthermore, as the Trustee herself points out, the Davis Companies filed suit in October 1999 arguing that the Flynns, McQuaid, and Emerald had repudiated the alleged agreement. It does not seem likely that Davis, Duehossois, and Emerald would all make contributions to Mayor Stephens’ campaign as part of a secret agreement that Emerald and the Flynns had already repudiated. What is far more likely is that Defendants’ contributions were made in order to encourage Mayor Stephens’ cooperation going forward. The Davis Companies and Duehossois Industries may also have wanted to participate in a casino in Rosemont now that legislation allowed for it, or they may have sought to curry favor with Mayor Stephens for independent reasons. Either way, the court does not infer from these belated campaign contributions the existence of an agreement in 1998.

Next, the Trustee points to a November 22, 1999 internal memo prepared by Stephen O’Neil of Bell, Boyd & Lloyd. The *83 memorandum purports to summarize a November 17, 1999, interview with Kevin Flynn and Joseph McQuaid, and tracks the history of Mayor Stephens’ interest in a Rosemont casino. O’Neil wrote that “[f]rom about October of 1998, the focus had turned to Rosemont. [Emerald’s] proposed legislation was never site-specific, but it was always understood from that time that Rosemont might be available.” (PX651 at 4.) The memo notes that Emerald did pursue other locations, as well, including Gurnee. (Id. at 3.) This memo does establish that Defendants were interested in a Rosemont location; it does not establish that an agreement had been reached.

As the Trustee emphasizes, Rosemont representatives participated in the lobbying efforts to amend the Riverboat Gambling Act. (Trusteed SOF ¶347.) Yet there is reason to believe that Rosemont had its own interests in the legislation, independent of any relationship with Emerald. Casinos were prohibited in Cook County, where Rosemont is located, prior to the legislation. (See Trustee’s SOF ¶ 259; C. Defs.’ SOF ¶ 143.) The new law lifted that restriction. (Trustee’s SOF ¶ 306; C. Defs.’ SOF ¶ 143.) Defendants contend they were in fact opposed to Stephens’s lobbying efforts because those efforts were location-specific and Emerald “fear[ed] that they would lose support from legislators from other municipalities.” (C. Defs.’ SOF ¶¶ 132, 137.) The participation of Rosemont representatives in lobbying efforts is more likely evidence of the Village’s own interest in lifting the Cook County restriction than it is of a secret deal between Davis, Duchossois, and Emerald.

Finally, the Trustee points to evidence that “[ejverybody else seemed to know,” even before passage of the legislation, that Emerald’s license was going to Rosemont. (Trustee’s SOF ¶ 330) (quoting PX162 at 9.) The IGB Final Board Order noted that “[t]he legislative history of the debate during which Section 11.2 of the Act was approved was replete with references to Rosemont as the designated city for the relocation.” (PX162 at 8.) Several legislators made public comments confirming that the license would be relocated to Rosemont even before the legislation passed. (Trustee’s SOF ¶ 350) (citing four different senator’s statements.) Victor Casini testified that “[i]t was common knowledge that the mayor of Rosemont was interested in a casino in Rosemont.” (Bankr.Tr.2088:l-8.) Again, however, these circumstances do not satisfy the court that Defendants had entered a secret agreement to sell ownership interests in a Rosemont casino.

The record reveals that Rosemont was a desirable location for the license, that the Mayor and Defendants were interested in establishing a casino there, and that Defendants discussed the possibility of relocating to Rosemont with Mayor Stephens, the Davis Companies, and Duchossois Industries. But the Trustee has not established by a preponderance of the evidence that there was an agreement to relocate a casino and “divide the pie.” Because the court is unable to find that the agreement existed, the court is unable to conclude that the Defendants violated IGB rules by failing to notify the IGB of an agreement to sell ownership interests in Emerald.

B. Emerald attempts to relocate to Rosemont

Once Emerald decided on Rosemont as a site, Emerald sought official approval from the Village of Rosemont. Within one week after the legislation passed, McQuaid met with the Mayor of Rosemont, Mayor Donald Stephens, to discuss potential locations for the casino within the Village of *84 Rosemont. (C. Defs.’ SOF ¶ 173.) They ultimately settled on a site that Rosemont owned. (Trustee’s SOF ¶ 362; C. Defs.’ SOF ¶ 173-74.) On June 30, 1999, Joe McQuaid sent a letter to the Village of Rosemont, requesting approval to relocate Emerald. (Trustee’s SOF ¶ 131; C. Defs.’ SOF ¶ 174.) Mayor Stephens replied the same day stating that Rosemont would be pleased to welcome Emerald. (Trustee’s SOF ¶ 132; C. Défs.’SOF ¶ 174.) On July 7, 1999, the Village of Rosemont officially approved the relocation of the casino. (Trustee’s SOF ¶ 133; C. Defs.’ SOF ¶ 174.)

On July 1, 1999, McQuaid and Walter Hanley met with IGB staff: then-Administrator Robert Casey, Chief Legal Counsel Mareile Cusack, and Deputy Administrator of Audit and Financial Analysis A1 McDonald. (C. Defs.’ SOF ¶ 192.) McQuaid and Hanley informed the IGB that Emerald had decided on Rosemont as a location and that they expected the Rosemont Village Board to act upon their pending request soon. (C. Defs.’ SOF ¶ 192.) A July 1, 1999 letter from McQuaid to Administrator Casey, summarizing the July 1, 1999 meeting, confirms this account. (PX306 at 1.) McQuaid’s letter stated that at the July 1, 1999 meeting, Emerald had submitted a “proposal to relocate to Rosemont” along with “copies of HP’s correspondence with the Village of Rosemont and a preliminary site plan.” (PX306 at 1.) The minutes from a July 20, 1999 IGB meeting also show that at that meeting Michael Ficaro, Emerald’s outside counsel, gave formal public notice of Emerald’s intention to relocate to Rosemont. (PX858 at 693-94.) The minutes reflect that Emerald provided the IGB with copies of the June 30, 1999 letters between McQuaid and Mayor Stephens, the official approval from the Village of Rosemont, and a diagram of the proposed casino. (PX858 at 693-94.) The court concludes that the IGB was on notice of Emerald’s intentions to relocate to Rosemont no later than July, 1999.

The IGB Final Board Order found that Emerald violated IGB Rules 140(a), 140(b)(3), and 110(a) by (1) failing to keep the IGB informed about the status of construction in Rosemont; (2) failing to disclose the existence of specific agreements between Emerald and the Village of Rose-mont; and (3) including terms in the Lease and Development Agreement with Rose-mont that violated IGB Rules. (PX162 at 32-36.)

1. Emerald’s construction activities

The IGB concluded that Emerald had violated Rules 140(a), 140(b)(3) and 110(a) by failing to disclose or misrepresenting to the IGB the status of construction in Rose-mont, including that Emerald began construction in the summer of 1999. (PX162 at 14, 31-35.) The Illinois Appellate Court affirmed, finding sufficient evidence that the IGB did not have “detailed knowledge of Emerald’s construction activities,” as the IGB requested construction plans on both September 17, 1999 and again on January 31, 2000. (PX1233 at T14.) The court interprets “status of construction” to mean whether Defendants disclosed to the IGB that construction activities were occurring, and not disclosures related to financing.

a. Construction progress

Soon after the legislation allowing relocation passed the Illinois legislature, Emerald’s Board of Directors met on June 23, 1999 and discussed relocation and construction plans. (PX18 at 6.) Emerald’s target date for opening the casino was August 1, 2000. (C. Defs.’ SOF ¶¶ 170, 350.) McMahon testified that in the summer of 1999, Emerald understood the *85 steps 11 that had to be taken before the casino could open, and that, based on his (and other Emerald employees’) experience constructing and opening Blue Chip Casino, Defendants believed that it would take “at least” eight or nine months to complete construction of Emerald — “we thought, by putting out that August number, that we had enough time to get it done in that window.” (Tr. 139:23-140:1, 140:9-141:3,141:11-15.)

In order to meet this deadline, Emerald used a “design-build” approach to construct the casino, which would allow it to begin construction before the casino’s design was complete. (C. Defs.’ SOF ¶ 179.) Under this approach, the architect, Aria Architects, would design an “overall, conceptual schematic,” and then “proceed to design specific components of the structure, so that construction could begin on those components, while design continued on other components of the structure.” (C. Defs.’ SOF ¶ 179.) At the June 23 meeting, the Board “authorized [Emerald’s] officers ... to prepare construction plans and budgets.... ” (PX18 at 6.) John McMahon became Emerald’s “point person” for design, construction, and financing of Emerald’s proposed casino that same .month. (Trustee’s SOF ¶457; C. Defs.’ SOF ¶ 179.) Kevin Flynn “oversaw all of the activities of the company as CEO,” but was not involved in Emerald’s day-to-day operations related to construction. (C. Defs.’ SOF ¶ 395.) McMahon began to meet with construction professionals as early as June 1999 (see PX218 at 2), and.testified that he attended “status meetings” regarding “ongoing projects” at the construction site weekly. (Tr. 202:9-203:6.)

At an Emerald Board meeting on August 12, 1999, McQuaid reported that Emerald had “engaged numerous professionals, including architects and engineers” for design and construction of the casino, and “described ... the timetable for clearing the site-, excavating the foundation and basin, ordering steel, and other key milestones.” (PX20 at 1.) The Board of Directors specifically “discussed the risk[ ] of .expending ... capital prior to obtaining all required approvals (including IGB. approvals)_” (PX20 at 1.) The Board nevertheless unanimously “authorized [Emerald’s] officers to proceed with the Development (and expend resources) in accordance with the timetable reviewed by the [B]oard.” (PX20 at 1.) Joseph McQuaid and Donald Flynn each testified that they believed that they were acting in Emerald’s best interest in voting to proceed with . construction. (Bankr.Tr. 2258:6-18 (Donald Flynn); Tr. 756:8-14 (McQuaid).) The Trustee notes that each of the Defendants attended this meeting. (Trustee’s SOF ¶ 467; see PX20 at 1.)

As the Trustee sees things. Defendants sought to begin construction immediately, regardless of the necessary IGB approvals, in order to begin making money on the casino as soon as possible. Some evidence supports this theory: For example, at his first meeting with Aria Architects, on June 7, 1999, Kevin Flynn “emphasized the importance for speed in this development, since every weeks [sic] delay is potentially missing over $2,000,000.00 dollars worth of *86 revenues.” (Trustee’s SOF ¶ 455) (quoting PX218 at 3.) Terry Graber of Power Construction also testified that at a construction meeting during the summer of 1999, Kevin Flynn and McQuaid indicated that them “plan” for the casino was “to try and get it up and running as quickly as possible.” (Bankr.Tr. 1098:1-20.) And, in a proposal letter dated July 2, 1999 from the Joint Venture (Power Construction/ Degen & Rosato) formed to build the casino to McQuaid, Isaac Degen “propose[d] to perform all the pre-construction and construction services on a fast track basis....” (PX238.) Terry Graber and Isaac Degen both testified that “fast track basis” meant something similar to Emerald’s “design-build” approach — proceeding with construction though designs for parts of the casino remained incomplete. (Bankr.Tr. 1099:5-1100:18,1870:23-1871:6.)

Emerald had other reasons to set a short deadline for completing construction, however. As noted above, Defendants contend that they understood that under the Riverboat Gambling Act they had a finite time period to complete construction or risk losing their license. (C. Defs.’ SOF ¶ 168.) Because Section 7(e) permits the IGB to revoke the license if a licensee “fails to begin conducting gambling within 15 months of receipt of the Board’s approval,” 230 ILCS 10/7(e), and Section 11.2 directed that “the Board shall grant the application and approval upon receipt by the licensee of approval from the new municipality or county” 230 ILCS 10/11.2(a) (emphasis added), Defendants believed, upon the advice of their attorney Michael Ficaro, that the fifteen-month time limit would begin to run as soon as Emerald submitted its application to the IGB for renewal and relocation. (C. Defs.’ SOF ¶¶ 162-64; D. Flynn’s SOF ¶¶ 88-89.) McMahon repeatedly referred to the fifteen-month provision when testifying about Emerald’s construction timeline. (See Tr. 138:20-140:1.) Emerald hoped to have its application for renewal and relocation approved by September 1999. (C. Defs.’ SOF ¶ 222; D. Flynn’s SOF ¶91.) In at least one meeting with Hanley and McMahon on September 30,1999, the IGB, too, appeared to encourage a swift construction timeline, asking whether Emerald could complete construction of the casino “sooner” than the anticipated August 1, 2000 deadline. (PX65 at‘2.)

Beginning in July and August 1999, the Village of Rosemont began to clear the site on which the casino would be built. (C. Defs.’ SOF ¶ 227.) In October 1999, Rose-mont issued Emerald a building permit for construction of a basin foundation for the casino (PX256); the Trustee notes that Emerald failed to disclose this permit to the IGB. (Trustee’s SOF ¶ 485.) Excavation of the basin that would hold the barge on which the casino would sit began in October 1999, and construction crews began to pour the concrete foundation for the basin the following month. (Trustee’s SOF ¶ 477; C. Defs.’ SOF ¶¶383, 385 (citing DX782-84, DX786, DX788-89, DX791, photographs taken of the construction site at this time).) In December 1999, the basin walls were built. (C. Defs.’ SOF ¶ 386) (citing DX793, a photograph taken on December 2, 1999, which shows construction of concrete walls.) At an Emerald Board meeting on December 22, 1999, McQuaid reported on the status of construction, and noted that “[Emerald] has paid or incurred approximately $4 million and the general contractor has made commitments for an additional $26 million of Development costs.” (PX25 at 1.) Again, the Board “discussed various aspects of the Development, including the risks of expending capital ... prior to obtaining all required approvals (including IGB approvals)” but proceeded unanimously to “authorize [Emerald’s] officers to proceed *87 with the Development (and continue to expend resources) in accordance with the construction timetable previously reviewed by the board.” (PX25 at 2.) Each of the Defendants attended this meeting, and no one at the meeting expressed concerns about continuing with construction. (PX25; C. Defs.’ SOF ¶288; D. Flynn’s SOF ¶¶ 107, 111.)

The project proceeded in late December 1999 and early January 2000, when construction crews began to build a land-based structure beside the basin, and the barge structure (the casino itself) that would float in the basin. (C. Defs.’ SOF ¶¶ 391-92) (citing DX795-96, photographs of construction taken on January 6, 2000.) Emerald received another building permit from Rosemont in January 2000 for “structural — bid shell” (PX419 at 17), which again, the Trustee notes, Emerald did not disclose to the IGB. (Trustee’s SOF ¶485.) The design for the land-based structure included “IGB’s on-site office, restaurants and other non-gaming facilities.” (C. Defs.’ SOF ¶ 391.) By early February, construction crews had completed laying the structural steel for the land-based structure. (C. Defs.’ SOF ¶ 429.) Attorney Ficaro advised Emerald to stop construction after the February 22, 2000 IGB Meeting, where the IGB indicated that Emerald needed prior approval to begin construction, and the Emerald Board unanimously voted to stop construction on February 24, 2000. (Trustee’s SOF ¶¶ 491, 494; C. Defs.’ SOF ¶¶465-66.)

• By the time Emerald stopped construction, in February 2000, the concrete foundations for the barge and land-based structure were complete, the barge and structural steel for the land-based structure were nearly complete, and construction crews were beginning to lay the structural steel for the casino facility on the barge. (Trustee’s SOF ¶ 497; C. Defs.’ SOF ¶ 469.) Aria’s design work at the time was nearly complete as well, as the architect had completed drawings and specifications for the entire casino, but needed to perform “contract administration.” (Trustee’s SOF ¶ 498.) Between March and December 2000, Defendants note, “Emerald continued to prepare to open the casino,” by completing the casino design 12 and continuing financing negotiations with LaSalle Bank. (C. Defs.’ SOF ¶ 475.)

b. Financing construction

To finance construction, Emerald used the money that it had received from the female and minority investors who had contracted to purchase Emerald shares (“Statutory Investors”). The IGB noted this in its Final Board Order, observing that Emerald had spent the approximately $30 million it had received from Statutory Investors on construction “because it could not secure financing for construction,” and that Emerald ■ had failed to inform the Statutory Investors that it would use the funds they had provided before the investors were approved as shareholders by the IGB. (PX162 at 13-14.) The IGB did not, however, conclude that Emerald’s use of *88 the proposed shareholders’ payments for construction violated an IGB Rule. 13

After Section 11.2 passed, Emerald prepared a proposed budget for design and construction of the casino, estimating the cost for the casino’s development at $135 million. Emerald also prepared a financing proposal under which Emerald would seek equity from current and proposed shareholders and would obtain senior secured bank financing, as well as subordinated debt. (C. Defs.’ SOF ¶ 176.) John McMahon was responsible for obtaining subordinated and senior secured financing for Emerald. (C. Defs.’ SOF 1Í178.) At a December 22, 1999 Emerald Board Meeting, • Joseph McQuaid reported that Emerald had sold 16.8 percent of stock for approximately $26.7 million, and that Emerald still needed to sell 3.16 percent of stock to minority shareholders in order to satisfy the female and minority shareholder requirement. (Trustee’s SOF ¶ 478.) Emerald increased the price of stock to $2.5 million per one percent interest for the remaining 3.16 percent, and the Board unanimously authorized McQuaid to sell the shares for the maximum price possible. (PX25 at 1.) At the same meeting, the Board also considered and unanimously authorized the Company’s officers to execute a proposal for financing $82 million from LaSalle Bank. (PX25 at 2-3.)

Emerald’s Board unanimously approved thp sale of shares to Statutory Investors on August 12,1999, after discussing Emerald’s “immediate need for equity investments to finance the [Rosemont] Development and facilitate a debt financing.” (PX1316 at 149.) In a letter dated October 20, 1999, McMahon wrote to Terry Graber of the Joint Venture (Power Construction/ Degen & Rosato), and copied Harris Bank, to inform the Joint Venture that “[Emerald] currently has over $25' million of equity capital in the bank, and [Emerald] is currently in negotiations with potential lenders to obtain debt financing, subject to the approval of the [IGB].” (PX254.) The Trustee notes that the “$25 million of equity capital” was a reference to the funds Emerald had obtained for the sale of shares to the Statutory Investors. (Trustee’s SOF ¶ 464.) In the end, Emerald received approximately $30 million from the sale of shares to the Statutory Investors, never obtained additional financing from other sources, and used the funds it received from the Statutory Investors for design and construction of the casino. (Trustee’s SOF ¶¶ 459, 465, 466; C. Defs.’ SOF ¶¶ 224, 257, 259, 365.)

At the same time that Emerald was using the Statutory Investors’ contributions for construction, the Trustee notes, Emerald informed the Statutory Investors 14 and the IGB 15 that it intended to *89 return money received from any Statutory Investors who were not approved by the IGB. (Trustee’s SOF ¶ 459.) Though it appears that Emerald did not have a plan or the funds to refund the payments that it received from the Statutory Investors (see, e.cg. Bankr.Tr. 1336:21-1338:6), if the IGB did not approve them as shareholders, the IGB made no specific finding that this alone violated any IGB Rule.

c. Communication with the IGB

i. The pre-approval construction requirement

Defendants maintain that IGB rules did not require that Emerald obtain IGB approval before beginning construction. (C. Defs.’ SOF ¶ 375;' D. Flynn’s SOF ¶92; Pedersen’s SOF ¶ 103.) At least some history supports that understanding: William Kunkle, the IGB’s first chairman, testified that between 1990 and 1999, the IGB did not require a casino licensee to obtain IQB pre-approval for construction. (Tr. 2511:13-24, 2527:16-19.) He further testified:

I can’t think of a single owner that didn’t do some kind of, whether it was actually physical construction or whether it was contracting for construction, contracting for the building of a riverboat, the remodehng1 of a riverboat, the leasing of a riverboat, the same for the dock, the shore facilities, the security systems.... They needed to make a decision, a business decision .... knowing that if the board didn’t like it, when the time came for a ruling on preliminary suitability, they might have to change it. But they could take that risk. And the board did not require advance notice about what they were doing.

(Tr. 2527:21-2528:20.) Joseph McQuaid, himself a former IGB staffer, said much the same thing. He testified that “[p]re-approval or approval in general [of construction] for the riverboats was not necessary” (Tr. 622:1-15), and that none of the original ten licensees had received pre-approval from the IGB before beginning construction. (Bankr.Tr. 3379:12-16.) McQuaid testified that this was his understanding of the IGB’s position in June 1999. (Tr. 622:16-22.) Though the Defendants did not believe that pre-approval was required, they did understand that the IGB would inspect the casino facilities, and possibly require changes, before Emerald Casino could open. (C. Defs.’ SOF ¶¶ 375-76; D. Flynn’s SOF ¶ 93.)

The IGB gave mixed signals about the pre-approval requirement. The minutes of an IGB meeting on September 7, 1999 state:

Chairman Vickrey stated that several licensees have requested initial consideration for proposed barge construction. The Chairman informed all licensees that prior to approving any such projects; the Board would like each owner licensee to submit expert reports attesting to the soundness of the engineering structure and electrical workings; and the environmental air quality of the facility as well as other matters relating to public health and safety. He stated that the reports must be submitted to staff prior to the Board’s final approval of any project. .

(PX858 at 700) (emphasis added.) Chairman Vickrey and Mareile Cusack, Chief Legal Counsel to the IGB, disagreed publicly, in a January 2000 Chicago Sun-Times article, about the pre-approval requirement. (DX276.) The article quoted Cusack as stating that Rule 230 requires any “prior board approval” for any “capacity or design change,” including barge construction, while Chairman Vickrey stated, “I don’t see it as a violation. What [Emerald is] doing is obviously trying to ready the casino so they can open at the earliest possible date to start generating, patrons *90 and revenue streams as soon as possible. I can understand that, from a business point of view.” (DX276 at 2.)

The language of Rule 230 is open to some interpretation. Rule 230(d) provides that an “owner licensee must immediately inform the Board and ... obtain prior formal Board approval thereof whenever a change is proposed in the following areas: ... G) Riverboat cruising schedules or routes, capacity or design change.” 86 III. AdmiN. Code § 3000.230(d)(1)(G). The Rule does not specifically mention construction of a new facility, and Defendants maintain that they did not believe that this rule applied to such construction. (C. Defs.’ SOF ¶ 380-81.) The IGB itself did not find that Emerald violated Rule 230(d), but it did conclude that because Emerald’s Lease and Development Agreement with Rosemont contained a term that allowed Rosemont to “waive” the pre-approval requirement (discussed below), Emerald violated Rule 110(a), which in broad terms prohibits any activity the IGB determines is a detriment to the gaming industry, the State of Illinois, or the public generally. (PX162 at 14, 34-35; see infra Background II.B.3.) Furthermore, the Illinois Appellate Court expressly rejected Defendants’ argument, reasoning “[cjommon sense would suggest that if Emerald could not change the design of its riverboat without prior formal Board approval, Emerald could not build an altogether new boat and associated structures without prior formal Board approval.” 16 (PX1233 at 113.)

Defendants did not obtain pre-approval for construction. Défendants did, however, inform the IGB that they planned to begin construction as early as August 10, 1999, and updated the IGB on September 30, 1999. {See infra Background II.B.l.c.) And while the IGB never gave express approval for beginning construction, the court concludes that it tacitly approved the construction when it failed to object as Defendants updated them about the status of construction.

ii. The IGB was aware of construction

The parties dispute what knowledge the IGB had about the ongoing construction in Rosemont. Defendants insist that they discussed the status of construction several times with IGB staff and were never directed to stop construction or warned that they were in violation of IGB rules. (C. Defs.’ SOF ¶ 396.) As discussed supra, John McMahon began to meet with construction professionals as early as June 1999 (PX218 at 2), and Emerald’s Board approved a construction timetable on August 12, 1999. (PX20 at 1.) Rosemont began “preliminary site-clearing activities” in July and August 1999 (C. Defs.’ SOF ¶ 227), and excavation of the basin began in October 1999. (Trustee’s SOF ¶ 477; C. Defs.’ SOF ¶¶ 383, 385.) As described below, the record reveals that the IGB was aware that Emerald began construction of the casino as early as October 1999, and it was public knowledge at least as early as Noyember 4,1999.

Defendants assert that the IGB was on notice even earlier. They maintain that on July 1, 1999, McQuaid and Hanley informed the IGB that construction would begin immediately. (C. Defs.’ SOF ¶¶ 192-93) (citing DX602.) The record contains little evidence to support this. Hanley’s handwritten notes, allegedly tak *91 en at the meeting, state “when does construction begin? ASAP w/r/t demolition, Phase 1, engineering studies, etc.” (DX602 at 2.) Throughout the IGB’s investigation, and continuing into this litigation, Defendants maintain that they consistently referred to the July 1, 1999 meeting as the basis on which Emerald began accepting funds from Statutory Investors and using those funds for construction, (C. Defs.’ SOF ¶¶ 189, 197), but they identify no compelling evidence in the record to support this claim. 17 While it is possible that construction was mentioned at the meeting, other evidence in the record demonstrates that the IGB neither approved the start of construction at that time nor was so much as put on notice that Emerald planned to begin construction. 18 Significantly, the letter from McQuaid to the IGB summarizing the meeting does not mention starting construction. (PX306.) Moreover, Defendants themselves point out that Emerald’s Board did not approve construction activities or expending funds on construction until the Board meeting on August 12,1999. (C. Defs.’SOF ¶ 378.) Nor is there any mention of approval for Emerald’s construction in the minutes from the July 20, 1999 IGB Board meeting. (PX858 at 693-694.) Those minutes state instead that Emerald was still seeking Board approval for the facility. Specifically, Emerald “would be presenting its plan at future Board meeting for its new facility and financing structure for Board consideration and appropriate Board action.” (PX858 at 693.)

Defendants McQuaid and Hanley did inform the IGB as early as August 10, 1999 that site-clearing activities were underway. *92 McQuaid understood site-clearing to constitute construction activities — or 'at least, that advising the IGB of site-clearing constituted notice that Emerald was engaging in preliminary construction activities. McQuaid and Hanley met with Acosta and Casey on August 10, 1999. (C. Defs.’ SOF ¶ 225.) McQuaid testified that he told Acosta at that time that “construction had begun at our site,” noting that “I didn’t differentiate between demolition, utilities being removed and additional utilities bringing in, land clearing. I categorized all that as construction.” (Tr. 655:9-656:17.) Hanley’s testimony corroborates this; he testified that McQuaid “explained the current status of the development project in Rosemont,”- specifically “the clearing of the land to prepare for the construction.” (Tr. 1240:18-1241:3.) Acosta admitted that he did not direct Defendants to put a halt to the site-clearing activities. (Bankr.Tr. 3635:7-22.) Acosta wrote McQuaid a letter dated the following day “to confirm the substance of our conversation yesterday,” in which Acosta stated:

[Djuring our conversation you mentioned some of the steps and expenditures [Emerald] has incurred in conjunction with the development of the Rosemont project. As you acknowledged, these efforts and expenditures are being incurred at the company’s own risk. The Gaming Board has in no way encouraged and is not responsible for any of the costs or risks the company and its principals have chosen to incur at this point.

(PX310 at 2.) Acosta testified that he understood “steps and expenditures” to mean “preliminary site clearing activities that were taking place at the site in Rose-mont,” and “were preliminary to the start of construction.” (Bankr.Tr. 3634:8-25.) Defendants interpret this letter as evidence that the IGB was aware that Emerald had begun started construction efforts, and that the “risk” Acosta referred to was the risk that the IGB would make changes to .the final construction design before granting approval. (C. Defs.’ SOF ¶¶ 229-30; D. Flynn’s SOF ¶ 97.) McQuaid also wrote a “follow-up” letter after the August 10 meeting, telling Acosta, “I want to keep the Board fully informed of our progress. I am concerned that [Emerald] may be portrayed in an undesirable perspective if media attention is directed toward construction . in Rosemont.” (PX311.) McQuaid’s testimony reflects that he and Acosta defined “construction” differently: while McQuaid believed that construction began with site-clearing activities, which he disclosed to the IGB, Acosta did not understand these activities to constitute construction. At a minimum, however, Defendants did put the IGB on notice at the August 10, 1999 meeting that Emerald was preparing to begin construction.

A few weeks later, at another meeting on September 30,1999, Defendants Hanley and McMahon informed the IGB that site-clearing activities had begun. Minutes from that IGB’ meeting show that, in response to Cusack and McDonald’s question whether construction had started, McMahon stated that Rosemont had begun preliminary site-clearing activities, but that these activities have not been “part of [Emerald’s] costs at this point.” 19 (PX65 *93 at 3.). Acosta also asked Defendants Han-ley and McMahon when the casino would be completed, and after Hanley answered that “they were still hopeful for an August 1, 2000 completion date,” “[Acosta] asked if a possibility existed that the completion would occur sooner than August 1.” (PX65 at 2.) The Trustee notes that McMahon and Hanley failed to disclose to the IGB at the September 30, 1999 meeting that they planned to begin construction in mid-October 1999. (Trustee’s SOF ¶ 482.) Emerald in fact began excavation in October 1999, but as McQuaid disclosed to Acosta on August 10, 1999, and as McMahon again disclosed at the September 30, 1999 IGB Meeting, site-clearing activities for the proposed casino had begun months earlier. Thus, at the September 30, 1999 meeting, as at the August 10, 1999 meeting, the IGB was put on notice that Emerald was moving forward with steps toward building the casino. Furthermore, Acosta’s question to Emerald about whether the casino could be completed sooner supports the conclusion that the IGB knew Emerald was proceeding with construction on a tight timeline.

Emerald began excavation of the basin in October 1999 — the first construction activity that occurred after site-clearing. (Trustee’s SOF ¶477; G. Defs.’ SOF ¶¶ 383, 385.) Walter Hanley provided Deputy Administrator McDonald a copy of Emerald’s “unaudited financial statements through September 30, 1999” in a letter dated October 29,1999. (PX319 at 1, 4-7.) The financial statements showed that Emerald had assets identified as “[c]onstruction-in-progress” worth $281,921. (PX319 at 5.) In addition, the financial records revealed that while Emerald had, as of September 30, 1999, $40,465,924 of “paid-in-capital,” it had just $26,256,016 in cash and cash equivalents. (PX319 at 5.) Nicholas Wilke, a financial and auditing consultant for the IGB, reviewed these financial statements for the IGB in the fall of 1999. (C. Defs.’ SOF ¶366; see Tr. 1613:3-24.) Wilke testified that after reviewing the financial statement and speaking with Hanley, he concluded that the “construction in progress” figure showed that • the casino was being constructed; that the “paid-in-capital” figure demonstrated that there had been an “influx of capital from minority investors”; and finally, that because “[t]he financial statement shows $26 million in cash” and “at that fime, there was about $30 million collected from minority investors,” then “some of those funds had to have been used” by Emerald. (Tr. 1615:7-1619:6.)

The IGB knew that construction had started as early as October 1999 — IGB investigators visited the construction site, and Acosta communicated with Joseph McQuaid about Emerald’s construction activities during this time. Based on the IGB’s physical presence at the site, and its communications with McQuaid, Defendants McMahon and McQuaid believed that Emerald’s earlier statements had effectively communicated to the IGB that construction had begun. McMahon testified that sometime between October 1, 1999 and early January 2000, he learned from the project manager that IGB investigators had visited the site and had taken photographs. (Tr. 224:18-229:2; 'see also Tr. 693:2-16.) In addition, McQuaid testified that Acosta called him in October 1999 and asked McQuaid to schedule a tour of the *94 construction site for Chairman Vickrey. (Tr. 693:17-694:5; see also PX1094 at 247-48 (293-94).) McQuaid agreed, and offered to meet with Vickrey at the site, but the IGB called McQuaid back later that day to say that McQuaid did not need to accompany Vickrey to the site. (Tr. 694:6-12.)

For his part, Acosta testified that he learned about Emerald’s construction activity in “approximately December of 1999 ... either through media accounts or a statement made to me by IGB staff.” (Bankr.Tr. 374:2-8.) But, in an IGB interview of McQuaid that he conducted on September 26, 2000, Acosta admitted to calling McQuaid about Vickrey’s plan to visit the construction site. When McQuaid testified that he received that call in October or November 1999, Acosta stated, “[yles, I do recall there was a conversation.” (PX1094 at 247-48 (293-94).) And in a preliminary report to the- IGB concerning Emerald’s Renewal Application, Acosta noted that IGB agents frequently visited the construction site after Emerald submitted its Renewal Application on September 24, 1999. (DX662 at 38.) Acosta’s testimony that he was unaware of construction activities in the fall of 1999 is not convincing — it demonstrates significant failures of communication within the IGB itself, 20 or a simple memory lapse.

The Trustee argues that Defendants both failed to disclose the status of construction at Rosemont, and affirmatively attempted to keep it “discreet.” (Trustee’s SOF ¶ 451) (quoting Emerald Meeting Minutes of 8/6/99, PX218 at 48.) She notes that Emerald never placed a sign at the construction site identifying it as the future site of Emerald Casino. (Trustee’s SOF ¶ 454.) Defendants explain that the decision not to place a sign on the site was an effort to avoid negative media attention and to be “deferential” to the IGB. (C. Defs.’ SOF ¶ 397.) Thus, at a meeting on August 6, 1999, various construction professionals and McMahon discussed a plan to place a sign “contain[ing] the names of all of the parties involved and a rendering” at the site, but McMahon cautioned that Emerald should “hold before placing the sign on the site until the [IGB] comes back with their approval of the documents” and “any construction on the site needs to be kept discreet as we prepare the site in anticipation of [IGB] approval.” (PX218 at 48.) Terry Graber, who attended this meeting and others like it on behalf of Power Construction, understood “discreet” to mean that McMahon wanted “to keep everything a low profile.” (Bankr.Tr. at 1110:12-1111:1.) McMahon and McQuaid represented Emerald at another meeting with construction professionals on September 24, 1999. Minutes from this meeting, similarly, state that “Emerald Casino noted that signage should not be placed on the site when the excavation starts.” (PX218 at 102, 107.) Notably, however, on January 20, 2000, McQuaid contacted Joe Haughey, the IGB Deputy Administrator and Director for Enforcement, to ask for the IGB’s input on the appropriate location for the IGB regulator’s offices at the proposed casino. (Trustee’s SOF ¶ 486; C. Defs.’ SOF ¶ 409.) McQuaid’s contact with Haughey on this question is inconsistent with any concerted attempt to conceal the status of construction from the IGB.

*95 Whatever Defendants did or did not say, there is substantial evidence that the IGB had knowledge of the construction activities from other sources as early as October 1999. IGB agents visited the site periodically, and reported on the status of construction to the IGB. A preliminary report from Acosta to the IGB concerning the IGB’s investigation of Emerald, dated September 5, 2000, confirms that “after the renewal application was submitted” (on September 24, 1999), “[IGB] Staff randomly inspected the site and observed the construction process.... ” (DX662 at 38.) IGB Agent John Gnutek testified that he visited the site in October 1999 and “saw site clearing,” which “to me was what I believed to be construction at the time.” (Bankr.Tr. 3324:10-20.) He also testified that other IGB agents had visited the site, though he could not recall the precise dates. (Bankr.Tr. 3324:16-20.) Jim Len-cioni, of Aria Architects, testified that he recalled a group from the IGB visiting the construction site, but could not recall when. (Bankr.Tr. 1087:5-17.) IGB financial consultant Nicholas Wilke testified that he learned that construction had begun after IGB Agents Gnutek and Pannier, who had visited the site, reported back to the IGB. (Tr. 1620:8-1621:11.)

Indeed, the construction of the casino was public knowledge. The construction site was visible from Interstate 294. (C. Defs.’ SOF ¶ 390; see Tr. 208:8-209:2; Bankr.Tr. 1154:2-22.) Wilke testified that he could see work being performed when he drove past the construction site. (Tr. 1620:8-23.) And, a Chicago Tribune article published on November 4, 1999 discussed the status of construction at the site, reporting that “Emerald Casino is already working on the Rosemont site between Bryn Mawr and Balmoral Avenues, east of the Tri-State Tollway. The company has excavated the pond that will hold the boat and is set to start pouring the concrete bottom by early next week.” (DX249.) Finally, during public comments at a December 16, 1999 IGB Meeting, a citizen noted “that construction is still going on in Rosemont at the proposed casino site” and asked the IGB whether that violated IGB rules. (PX858 at 735.) No member of the IGB commented in response. (Id.)

The Trustee maintains that McQuaid’s phone call to Haughey on January 20, 2000 21 . “was the first time that the IGB was notified by Emerald that construction was underway at the Project.” (Trustee’s SOF ¶486) (citing PX69, Letter from Acosta to Hanley of 1/25/00, stating “it was somewhat surprising to me to learn that construction of your proposed facility had gotten to the point where office space was being allocated.”) IGB Deputy Administrator McDonald then, requested “additional information as it relates to the construction project” on January 31, 2000. (PX72.) Hanley responded to Acosta’s letter, specifically asserting that IGB personnel knew about the status of construction prior to January 2000:

*96 At several meetings with you or your staff, Emerald has described the nature and status of its construction in Rose-mont. You and your staff have consistently advised Emerald that all construction is at Emerald’s risk. Agents of the Illinois Gaming Board have visited the construction site on multiple occasions and have interviewed construction personnel at the site. We would welcome the opportunity to advise the Board publicly of the status of Emerald’s development.

(DX279 at 1; see also DX300 at 1-2 (March 15, 2000 Letter from Ficaro to Acosta stating “Emerald ... has had numerous contacts with the Board’s staff regarding the subject of construction work in Rosemont. These contacts go back to pri- or to our meeting on August 10, 1999, and have occurred as recently as our meeting on March 9, 2000”).) As Hanley’s letter reflects, the Trustee’s argument that the IGB only learned of construction in January 2000 is belied by the facts that Defendants (McQuaid, Hanley, McMahon) repeatedly informed the IGB in August and September 1999 that the site was being cléared for construction; that Hanley disclosed construction expenditures to the IGB in October 1999; that IGB personnel visited the construction site on several occasions in the fall of 1999. 22 The IGB concluded in its Final Board Order that Emerald failed to disclose “the status ,of construction in Rosemont” (PX162 at 32), but the Trustee has provided insufficient evidence to demonstrate that any of the Defendants here individually concealed or otherwise failed to disclose the progress of construction.

2. Emerald failed to disclose preliminary agreements between Emerald and Rosemont to the IGB

In addition to the concern about IGB knowledge of construction, the IGB’s Final Board Order revoking the license separately relied on Emerald’s failure to disclose specific agreements between Emerald and the Village of Rosemont. (PX162 at 32; see also PX1233 at 112 (stating that the Board appeared more concerned about Emerald’s failure to disclose agreements and plans relating to construction than concerned about commencing construction without approval or notice).) The IGB identified a total of five documents that Emerald failed to disclose related to the agreement between Emerald and the Village of Rosemont to relocate the casino in Rosemont.

• First, on July 21, 1999 (C. Defs.’ SOF ¶ 208), Joe McQuaid and Mayor Stephens executed a Letter of Intent to “memorialize key terms that have been agreed to” of the arrangement for Emerald to use the Rosemont site. (PX192 at 1.) Hanley and McQuaid worked with the. Village of Rosemont’s lawyer Peter Rosenthal on several drafts of the agreement. (See PX192 at 7) (Hanley cc’ed on Letter of Intent).) The Letter outlined key provisions such as rent and term of the lease and payment obligations for various construction ■ costs. (PX192 at 1-5.) The Letter contemplated that the parties would execute a final Lease and Development Agreement. (PX192 at 1; Trustee’s SOF ¶ 365; C. Defs.’ SOF ¶ 208.)

*97 • On August 2, 1999, Defendant McQuaid, on behalf of Emerald, and with the authorization of the Emerald Board, executed a second agree-. ment with Rosemont — the Rosemont Site Access Agreement. (PX365 at 2; Trustee’s SOF ¶ 368.) The main purpose of this agreement was to allow Emerald to begin work on the site prior to approval of a final Lease and Development Agreement. . (PX365 at 1.)

• Between August 26, 1999 and December 1, 1999 Emerald and Rose-mont also entered three Extension Agreements to maintain the terms of the Letter and the Site Agreement until they signed a final Lease and Development Agreement. (PX367; PX377; PX380; Trustee’s SOF ¶¶ 378-379; C. Defs.’ SOF ¶ 209.) McQuaid signed these documents on behalf of Emerald (PX367 at 3; PX377 at 2; PX380 at 2), and Hanley received a copy of each of them. (PX401 at ¶ 729 (August. 26, 1999 agreement), ¶ 737 (September 28, 1999 agreement), ¶ 744 (December 1, 1999 agreement).) Emerald and Rosemont executed the final Lease and Development Agreement on February 10, 2000 and sent a copy of the executed agreement to the IGB. (Trustee’s SOF ¶ 394; C. Defs.’ SOF ¶ 422.)

Emerald did not provide copies of the Letter of Intent, the Site Access Agreement, or the Extension Agreements to the IGB until December 5, 2000. (PX41 at 26; Trustee’s SOF ¶ 403. See also PX1106 at 2.) The parties dispute the reason for Emerald’s failure to disclose these documents earlier. The Trustee maintains that Emerald was purposefully withholding information despite the IGB’s consistent requests that Emerald submit documents and be “over-inclusive” in their submissions. ' (Trustee’s SOF ¶¶ 388 — 90; ¶¶ 395-96.) Defendants contend that McDonald told them that IGB lacked the staffing capacity to review draft agreements and asked Emerald not to send drafts. (C. Defs.’ SOF ¶¶ 348-49.) Emerald, therefore, waited until it executed final agreements to submit documents. (C. Defs.’ SOF ¶ 212-13.) The IGB concluded in its Final Board Order that Emerald was under an obligation to disclose the earlier agreements and that Emerald did not make the required disclosures. (PX162 at 13, 36-37.) The Illinois Appellate Court affirmed this finding. (PX1233 at 114-18.)

The evidence shows that at various times between August 1999 to December 5, 2000, Defendants McQuaid, McMahon, and Hanley had knowledge of the agreements and opportunities to disclose the agreements to the IGB. On August 10, 1999, soon after the Letter of Intent and Site Access Agreement were executed, Hanley and McQuaid met with then newly-appointed IGB Administrator Acosta for the first time. (Trustee’s SOF ¶¶ 371-72; C. Defs.’SOF ¶ 225.) McQuaid and Han-ley attempted to submit a copy of the old Renewal Application to Acosta, but he informed them that the IGB was developing a new version of the application form, in light of Section 11.2. (C. Defs.’ SOF ¶ 226.) ■ Defendants maintain that McQuaid disclosed in that meeting that the Village of Rosemont had begun site-clearing activities. Acosta later admitted that he knew about the preliminary site clearing. (Bankr.Tr. 3634:16-35:6; C. Defs.’ SOF ¶ 227.) It is undisputed, however, that Hanley and McQuaid did not provide copies of the Site Access Agreement or the Letter of Intent at this meeting. (See PX41 at 26 (Emerald’s Verified Answer’ admitting that the documents were not disclosed until December 2000.))

*98 Two days later, on August 12, 1999, McQuaid sent Administrator Acosta a follow-up letter regarding the August 10 meeting. (Trustee’s SOF ¶ 373; C. Defs.’ SOF ¶ 232.) McQuaid’s letter noted Emerald’s concern about “media attention directed toward the construction in Rose-mont” (PX311 at 1; C. Defs.’ SOF ¶ 232), but the letter again did not include information about or copies of the Letter of Intent or the Site Access Agreement. (Trustee’s SOF ¶ 373.) On September 7, 1999, Michael Ficaro represented Emerald at an IGB Board meeting to request consideration of Emerald’s renewal and relocation proposal. (PX858 at 705.) Again, however, Ficaro did not provide the IGB Board with the Letter of Intent, the Site Access Agreement or the existing Extension Agreements. (Trustee’s SOF ¶ 374.) McQuaid and Hanley met one more time with Administrator Acosta on September 17, 2000. (Trustee’s SOF ¶ 375; C. Defs.’ SOF ¶ 270.) Again, the documents were not disclosed. (See PX384) (November 27, 2000 letter from McQuaid to Acosta explaining the failure to provide the Letter of Intent to the IGB.)

On September 24, 1999, McQuaid submitted Emerald’s Renewal Application, using the new form the IGB had developed. (PX418.) McQuaid prepared this second Renewal Application, with the assistance of Hanley, Larson, and McMahon. (C. Defs.’ SOF ¶ 287; see infra Background III.A.) Question 47 of the renewal application form asked Emerald to “Submit any agreements between LICENSEE and mu-nieipality(ies) not elsewhere disclosed in this application, and any other agreements between the municipality(ies) regarding funds, revenues or other benefits to be derived from this license.” (DX213 at 10) (capitalization in original.) Emerald’s Renewal Application disclosed that “[p]relimi-nary discussions have been held with representatives of the Village of Rosemont. These discussions are continuing and will eventually result in a development agreement, but to date no formal agreement has been executed.” (C. Defs.’ SOF ¶¶315-16.) Emerald’s Application also disclosed that it intended to enter into a development agreement with the Village of Rose-mont, but did not submit any of the preliminary letters or agreements with the Renewal Application. (PX418 at 94.) Emerald did identify and submit two agreements with Rosemont: (1) a resolution by the Board of Trustees of the Village of Rosemont approving Emerald’s request to relocate the license to Rosemont, and (2) a tax-revenue sharing agreement with Rose-mont to share the revenue from the casino with dozens of other Cook County communities. (PX418 at 94.) The application did not include the -Letter of Intent, the Site Access Agreement, or the existing Extension Agreements. (PX418.)

On September 30, 1999, Hanley and McMahon met with Administrator Acosta and several other IGB staff. (Trustee’s SOF ¶ 380; C. Defs.’SOF ¶ 341.) According to Defendants, the primary purpose of the meeting was to discuss debt financing. (C. Defs.’ SOF ¶ 341.) The parties also discussed the progress of construction, however. McMahon was aware that site clearing activities were happening at the site pursuant to the Letter of Intent and Site Access Agreement. As he testified at trial, as of late July and early August of 1999, the Village of Rosemont was “clearing those structures, making the site ready for us as part of our lease agreement with them.” (Tr. 159:22-160:1, 160:21-161:15.) At the September 30, 1999 meeting, McMahon stated that the Village of Rose-mont was conducing site-clearing activities and that Rosemont was incurring the costs. (C. Defs.’ SOF IT 346.) McMahon also stated that there was “no lease agreement” yet, but that the parking garage *99 was being negotiated. (C. Defs.’ SOF ¶ 346; PX65 at 3.) McMahon and Hanley did not disclose the existence of or provide copies of the Letter of Intent, the Site Access Agreement, or the Extension Agreements. Defendants admit that Administrator Acosta and the IGB staff requested that Emerald submit copies of contracts to the IGB. (Trustee’s SOF ¶ 383; C. Defs.’ SOF ¶ 348.) Defendants nevertheless assert that the IGB provided mixed signals at this meeting:. Administrator Acosta asked for Defendants to be “over-inclusive” with the documents they sent. (C. Defs.’ SOF ¶ 348; Trustee’s SOF ¶ 383.) But, according to Hanley and McMahon, Deputy Administrator McDonald suggested that it was only necessary to submit executed contracts and not drafts. (Tr. 197:14-23, 1252:9-53:10; C. Defs.’ SOF ¶ 348-49.) McDonald’s testimony. confirmed that Acosta had asked Defendants to be “over-inclusive, that they should just give us more documents than— we’ll tell them when to stop.” (Bankr.Tr. 3347:17-22.) McDonald did not specifically recall telling Defendants that the IGB was not interested in receiving drafts or preliminary agreements (Bankr.Tr. 3347:24-3348:6), but he acknowledged it was “not the practice ... for [the IGB] to request ... [documents that were preliminary to a final agreement” from a licensee. (Bankr.Tr. 3350:4-11.)

On October 19, 1999, McDonald wrote to Hanley, requesting copies of “agreements reached with governmental entities,” (PX318 at 2; Trustee’s SOF ¶ 385), and “all significant contracts or agreements you may have executed since your last submission.” (PX318 at 2; C. Defs.’ SOF ¶ 362.) Emphasizing the use of the word “executed,” Defendants urge that they interpreted this request to mean final agreements (C. Defs.’ SOF ¶ 52); but the IGB Final Board Order concludes that the IGB had a broader scope in mind. Furthermore, although labeled a “Letter of Intent,” the document signed by Emerald and the Village of Rosemont on July 21, 1999 was a contract that bound the Village of Rosemont and Emerald. In fact, the Letter stated that it was intended to “memorialize key terms that have been agreed to.” (PX192 at 1.) The Illinois Appellate Court found that the Letter of Intent, the Site Access Agreement, and three Extension Agreements were contracts. (PX1233 at 104.) Even accepting Defendants’ contention that the IGB wanted only final, not draft agreements, the Letter of Intent, Site Access Agreements and Extension Agreements fell into the category of “executed agreements.”

Hanley responded to the letter on October 29, 1999. (Trustee’s SOF ¶ 386; ' C. Defs.’ SOF ¶ 364.) Hanley included financial statements and information, but again did not include the relevant Rosemont agreements. (PX319.) On January 25, 2000, Administrator Acosta wrote to Han-ley again, warning that the IGB had not yet received any contracts from Emerald. (Trustee’s SOF ¶ 388.) Hanley responded the next day, but still did not include the Letter of Intent, Site Access Agreement, or Extension Agreements, presumably on the understanding that these did not constitute executed contracts.

Then on January 31, 2000, McDonald wrote to Hanley, again requesting the submission of documents, but this time using much broader language; McDonald specifically asked for “letters of intent” and other non-final agreements entered into since July 1, 1999. (Trustee’s SOF ¶ 391; C. Defs.’ SOF ¶ 419.) On February 10, 2000, Emerald executed the final Lease and Development Agreement with the Village of Rosemont. (C. Defs.’ SOF ¶422.) Four days later, on February 14, 2000, Hanley responded to McDonald’s letter with a list of written agreements and not-fully-exe *100 cuted Agreements. (Trustee’s SOF ¶ 395.) But that list did not include the Letter of Intent, the Site Access Agreement, or the three Extension Agreements. (Trustee’s SOF ¶ 296; C. Defs.’SOF ¶ 430.) Defendants assert that Hanley believed there was no need to submit the Letter of Intent and other preliminary agreements, because Emerald had by this time submitted the February 10, 2000 Lease and Development Agreement, which was the final agreement and superseded the earlier versions. (C. Defs.’ SOF ¶ 430.) The Trustee alleges that it was Kevin Flynn who supervised drafting the February 14, 2000 letter. (Trustee’s SOF ¶ 397.) In his testimony, Kevin Flynn equivocates about whether he was directly involved in collecting the documents or merely provided general oversight. (Bankr.Tr. 990:17-93:19.) Without more, the court in unable to conclude that Kevin Flynn withheld documents from the IGB.

Whatever mixed signals or misunderstandings there may have been about whether Emerald was required to submit the docum'ents, the IGB Final Board Order concluded that Emerald was required to send the Letter of Intent, the Site Access Agreement, and the Extension Agreements. (PX162 at 13.) The evidence largely supports the conclusion that Emerald did not in fact submit those materials to the IGB until December 5, 2000. Only McQuaid’s testimony suggests that the documents were submitted by Emerald to the IGB at an earlier date. (See C. Defs.’ SOF ¶ 216.) Before the Bankruptcy Court, McQuaid testified that he submitted the documents to then-Administrator Casey at a meeting in early August 1999. (Bankr.Tr. 3401:7-19, 3436:8-16.) McQuaid admitted that he was unable to find any record of the transmittal, however (Bankr.Tr. 3403:6-9, 3451:22-3452:9), and . that, the documents were not submitted to the IGB on any other occasion. (See Tr.. 990:19-22.) 23

Other contemporaneous evidence supports the conclusion that the documents were not submitted in response to IGB’s requests for contracts before December 5, 2000. On November 27, 2000, McQuaid wrote to Acosta, explaining that the Letter of Intent had not been submitted because he did not believe it was a final executed contract. (PX384 at 1.) In a letter dated December 5, 2000, Hanley apologized to the IGB for not providing the documents earlier and attached copies of the relevant documents with this letter, evidently for the first time. (PX1106 at 2; Trustee’s SOF ¶ 403.) Finally, in its Answer to the IGB’s Disciplinary Complaint for revocation of the license, Emerald asserts that the letters were not submitted because Emerald did not believe they were required to submit them. (PX41 at 26.) McQuaid’s testimony that he submitted the documents to then-Administrator Casey is not credible in light of the weight of this contemporaneous evidence.

In short, although the parties dispute the reasons that Emerald failed to disclose the documents, they do not seriously dispute that Emerald did fail to disclose the documents until December 5, 2000. This failure to disclose violated IGB Rules 140(a) and 140(b)(3). (PX162 at 32-33.) The evidence reveals that Defendants McQuaid, Hanley, and McMahon were responsible for this failure to disclose.

*101 3. The IGB found that the final Lease and Development Agreement between Emerald and Rosemont violated IGB rules

The IGB also found that the final Lease and Development Agreement, which was submitted to the IGB on the day it was executed, contained multiple provisions that violated the IGB’s rules. (PX162 at 14-15, 34-35.) First, the IGB found that the Agreement “allowed the Village of ■Rosemont to waive the requirement that Emerald obtain necessary regulatory approval from the IGB prior to commencing construction of the casino.” (Id. at 14.) Second, the Agreement also “committed Emerald to fund the construction of a parking garage even though Emerald did not have sufficient financing dedicated to do so.” (Id. at 14-15.) Third, according to the IGB, the Agreement “failed to provide Emerald the ability to exercise appropriate control or supervision over the management of the contractor or sub-contractors for the casino and parking garage construction project.” (Id. at 15.) The last finding related to the fact that D & P Construction Company, an organization “controlled by Peter and John DiFronzo,” worked on the construction site. (Id.) According to an FBI memo that the IGB had access to, but which was not produced here, John DiFronzo had been identified “as a known member of the Chicago Outfit” and “Peter DiFronzo was considered to be a member of the Chicago Outfit.” (PX162 at 16.) The Illinois Appellate Court, however, found that the IGB’s findings related to organized crime “against the manifest weight of the evidence” and overturned these findings. (PX1233 at 105.) Therefore, only the first two provisions of the Lease and Development Agreement are at issue here.

The Lease and Development Agreement authorized Emerald to commence construction “subject to [Emerald’s] performance to the satisfaction of, or waiver by, the Village prior to or on the Construction Commencement Date of every covenant required to be performed by [Emerald] prior thereto including the following conditions precedent.” (PX188 at 45, Art. 8.) Among the “conditions precedent’’ the Village was authorized to waive were “Required Construction Approvals” (PX188 at 46, § 8.4), including specifically “the approval of the Gaming Board of the relocation of the home dock for Developer’s Owner’s.License to the Village.” (PX188 at 26, § 1.50.)

The Defendants do not dispute the inclusion of these terms, but do dispute the overall meaning of the contract. Citing Article 7, Defendants maintain that the entire agreement was contingent on IGB approval. (C. Defs.’SOF ¶445.) Specifically, they point out that the Agreement provides “[t]he obligation of the Developer to proceed with the development of the Casino site ... shall be subject to fulfillment to the satisfaction of, or waiver by, [Emerald ... of the following conditions precedent,” including that Emerald “shall have obtained all Required Construction Approvals.” (PX188 at 42.) But this term, cited as evidence that the Agreement was contingent on IGB approval, itself includes the “waiver” language that the IGB took issue with. The only difference between this provision and the provision the IGB took issue with is that Emerald, rather than Rosemont, is the party authorized to waive the condition. The IGB interpreted the contract as providing the Village of Rosemont with the authority to “waive” the requirement for IGB approval before construction could begin. (PX162 at 15.) This court notes that a contractual provision could not give the Village power to “waive” a state regulatory requirement; as the Appellate Court noted in another context, “[w]aiving the Board’s *102 approval would put the contracts in violation of Rule 235(a) and illegal contracts are void.” (PX1233 at 122.) In any event, the Illinois Appellate Court did not overturn the IGB’s finding concerning this provision.

The parties also dispute now whether the IGB even had a rule requiring licensees to obtain approval prior to commencing construction. The Trustee alleges that Emerald was required to obtain prior approval for construction activities and failed to do so in violation for Rule 230(d). (Trustee’s SOF ¶ 448.) Defendants note that Rule 230(d) only requires IGB prior approval “whenever a change is proposed” in the design of a casino. 86 III. Admin. Code § 3000.230(d). The Illinois Appellate Court rejected this interpretation of Rule 230(d): “Common sense would suggest that if Emerald could not change the design of its riverboat without prior formal Board approval, Emerald could not build an altogether new boat and associated structures without prior formal Board approval.” (PX1233 at 113-14.) However the language of Rule 230(d) is interpreted, Defendant contend, it was not the normal practice of the IGB to require advance approval for casino construction. (C. Defs.’ SOF ¶ 372.) To the contrary, all the original licensees commenced physical construction or contracted for construction without obtaining IGB approval. (C. Defs.’ SOF ¶ 375.) The IGB itself gave mixed signals about whether prior approval was necessary, Defendants observe, and Chief Legal Counsel Cusack and Board Chair Vickery themselves publicly disagreed about whether there was such a requirement. (C. Defs.’ SOF ¶¶ 403-06.) Though the pre-approval requirement may have been poorly, if ever, communicated to Defendants, the IGB ultimately decided that prior approval for construction was necessary, and the Illinois Appellate Court agreed. (PX1233 at 113.)

The IGB found, further, that the inclusion of the “waiver” term in the Rosemont agreement, a term that purportedly contemplated a violation of Rule 230(d), violated Rule 110(a). (PX162 at 35.) Emerald itself admitted, in its Verified Answer to the Disciplinary Complaint for revocation of the license, that the Lease and Development Agreement “among other things, allows the Village of Rosemont to waive the requirement that Emerald first obtain the necessary regulatory approval from the Board prior to commencing construction of the casino.” (PX41 at 28.) A contract term could not, of course, authorize the Village of Rosemont to “waive” a state regulatory requirement; as the court understands this contract language, it meant that Rosemont was willing to permit progress on construction of the casino before the IGB itself had approved it. Although Defendants may have genuinely believed that the contract nevertheless remained contingent on IGB approval (C. Defs.’ SOF ¶445), the IGB disagreed and cited that provision as a basis for its revocation order.

The second term in the Lease and Development Agreement that the IGB took issue with was the term outlining the financing to build a parking garage. The IGB found that the Lease and Development Agreement “obligated Emerald to fund the construction of a parking garage even though [it] did not have sufficient financing to do so.” (PX162 at 36.) Defendants assert that Emerald’s obligation to build the Parking Garage was subject to a condition precedent that Emerald first obtain financing. (C. Defs.’ SOF ,¶446.) The Trustee argues there was no condition. Article 12.1 of the contract simply required Emerald, “at its cost and expense, [to] design the Parking Facility Addition.” (Trustee’s SOF ¶411) (quoting PX188 at 57, § 12.1.) As this court reads *103 that language, it imposed a requirement that Emerald design the facility — not construct it. Moreover, the Lease and Development Agreement also contains a specific section entitled “Conditions Precedent to the obligation of the Developer” (PX188 at 42, Art. 7), including, specifically, the condition that Emerald “shall have obtained construction financing commitments from financial institutions ... for construction and completion of the Casino, the Parking Facility Addition and the Common Areas.” (PX188 at 43, § 7.2.) Although Article 7 permitted Emerald to “waive” the conditions precedent (see PX188 at 42), the agreement certainly did not obligate Emerald to fund the parking garage without financing. Thus, although the IGB may have had separate concerns about the specific financing Emerald did ultimately obtain for the parking facility (see, e.g. PX162 at 14), the Trustee has not established that the Lease and Development Agreement included a term that “obligated Emerald to fund the construction of a parking garage even though [it] did not have sufficient financing to do so.” (PX162 at 36.)

The Trustee has established that the Lease and Development Agreement included one term that the IGB determined violated its rules — the term permitting Rosemont to “waive” the requirement of IGB approval. For purposes of this case, in which the Trustee seeks to impose liability on the individual Defendants, the inclusion of an unlawful term in the final Lease and Development Agreement is insufficient. The Trustee must also establish which individual Defendant was responsible for the term. As Defendants note, the Lease and Development Agreement was the product of negotiation between Emerald, Emerald’s outside counsel, the Village of Rosemont, and Rosemont’s attorneys. Several drafts were exchanged and various individuals added and subtracted terms. (C. Defs.’ SOF ¶¶ 433-38, 444.) The Trustee does not specify which terms she believes Defendants were responsible for including (or subtracting).

The Trustee has presented evidence that Walter Hanley was the point person on behalf of Emerald for drafting the Lease and Development Agreement. Defendants admit that Hanley communicated with Rosemont’s attorney and reviewed and edited the various drafts of the Agreement. (C. Defs.’ SOF. ¶¶ 432-40.) Hanley also routinely consulted with outside counsel regarding the drafts. (C. Defs.’ SOF ¶¶ 433, 435-36, 438.) McQuaid, too, was involved in some of the meetings with outside counsel regarding the drafts of the Lease and Development Agreement. (C. Defs.’ SOF ¶ 436.) At an Emerald Board meeting on December 22, 1999, Hanley reviewed the draft of the Lease and Development Agreement and discussed its key elements. (C. Defs.’ SOF ¶ 439.) The Emerald Board,

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