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US top court rejects union appeal over Trump casino bankruptcy

The U.S. Supreme Court on Tuesday rejected a union's appeal of a lower court's ruling that allowed Atlantic City's Trump Taj Mahal casino, founded by Donald Trump but now owned by billionaire investor Carl Icahn, to break its contract with union workers to secure a bankruptcy rescue deal.

The high court's decision not to hear the appeal by Unite Here Local 54 leaves in place a January decision by the Philadelphia-based 3rd U.S. Circuit Court of Appeals that cleared the way for the casino to exit Chapter 11 bankruptcy.

The struggling casino has since emerged from bankruptcy and is now owned by Icahn Enterprises. It was the New Jersey city's largest casino when Trump opened it in 1990 but it later fell on hard times along with other Atlantic City casinos.

The Trump Taj Mahal casino in Atlantic City, New Jersey.
Getty Images
The Trump Taj Mahal casino in Atlantic City, New Jersey.

Trump, the billionaire real estate developer and presumptive Republican U.S. presidential nominee, founded the casino and it bears his name, but he has said he no longer has a stake in it.

In 2014, the casino's owner, Trump Entertainment Resorts, filed for bankruptcy. Last year, it convinced a U.S. bankruptcy judge that it had to impose a new lower-cost contract on unionized workers in order to secure Icahn's rescue deal.

The union appealed, arguing that because the collective bargaining agreement expired before the bankruptcy, the U.S. Bankruptcy Court lacked jurisdiction.

The appeals court sided with Trump Entertainment, saying a bankruptcy judge must be free to evaluate a labor contract that may determine the fate of a business.