The lawsuit filed Monday in U.S. District Court in Albuquerque claims commissioners let the license for La Mesa Racetrack and Casino expire after the project faced a number of delays.
It also accused former commissioner Marty Cope of intentionally blocking the project because she was a friend of a rival.
She "intentionally, willfully and purposefully took action to hinder La Mesa's progress and to sabotage La Mesa's racino project," the lawsuit said.
Specifically, the lawsuit accuses Cope of tabling La Mesa's various requests to amend race dates thereby "running out the clock" on the license.
La Mesa is seeking an unspecified amount of damages for losses.
In an email statement to The Associated Press, New Mexico Racing Commission Chairman Rob Doughty said the commission couldn't comment on the lawsuit. But he pointed out the lawsuit stems from actions by a different body.
"This is a different Racing Commission under a different administration from the one that the lawsuit makes allegations against," Doughty said.
No one answered a phone number listed for Cope in Alto.
The lawsuit came after La Mesa spent millions of dollars on the northern New Mexico project originally set to open in May 2010. The promise of the project created much fanfare in Raton during the 2009 groundbreaking, which attracted the hometown trainer of Kentucky Derby winner "Mine That Bird."
The board eventually revoked the license, saying developers failed to open the casino by the target date and didn't show they had adequate financing to complete the racetrack.
In June, the New Mexico Court of Appeals upheld the commission's 2010 decision to nullify the license for electronic slot machines.
Michael Moldenhauer, a real estate developer in the Toronto area, is behind the project that called for a 1-mile oval track with a casino, lounge and entertainment areas.
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