Judge Denies HG Vora’s Bid to Expedite Lawsuit Against Penn Entertainment
U.S. District Court Judge Mary Wells rejected HG Vora Capital Management’s request to expedite its lawsuit against Penn Entertainment, ruling that the hedge fund failed to demonstrate immediate harm warranting a faster trial. The decision, issued in the Eastern District of Pennsylvania, also partially granted Penn’s motion to stay proceedings, pausing one claim for 30 days while a special litigation committee (SLC) investigates fiduciary duty allegations.
Court’s Ruling and Case Status
Judge Wells denied HG Vora’s motion for an expedited trial and early case management conference, finding insufficient evidence of urgent harm.
She partially approved Penn’s stay request, halting only Point V of the lawsuit, alleging the board’s breach of fiduciary duties, for 30 days until August 1, 2025, to allow the SLC to complete its internal probe and submit a status update.
The court canceled a planned July 10 oral hearing, while the remaining claims, including accusations of misleading proxy statements, will proceed as scheduled.
HG Vora, holding an 18.5% stake in Penn, seeks to void the company’s board reduction plan, demand corrected disclosures, and secure board seats for its nominees.
HG Vora’s Allegations Against Penn
HG Vora’s lawsuit, filed in May 2025, accuses Penn Entertainment of restructuring its board to block shareholder-nominated candidates and providing misleading proxy statements, violating federal securities laws and Pennsylvania’s Business Corporation Law.
The fund claims Penn’s actions distorted board election outcomes, undermined shareholder voting rights, and caused $11 billion in investor losses over four years.
HG Vora also criticized Penn’s focus on digital operations, media acquisitions, and CEO compensation. The fund demands the inclusion of its three candidates, two of whom, Johnny Hartnett and Carlos Ruisanchez, were elected in June 2025 with 55% proxy support, on Penn’s board, alongside damages and legal costs.
Penn countered that fiduciary duties are owed to the company, not individual shareholders, and Pennsylvania law empowers an SLC to control such claims.
After the June 2025 shareholder meeting, Penn welcomed the elected HG Vora nominees and pledged ongoing shareholder engagement. Despite the partial stay, the lawsuit’s core issues, board governance and transparency, remain active.
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