Bloomberg reports that bondholders owed $7 billion by Caesars have been denied an immediate ruling as to whether or not the casino giant broke the law, thus giving Caesars several more weeks grace to negotiate with creditors. U.S. District Judge Shira Scheindlin’s decision delay puts a temporary halt on Caesars threat of placing its entire corporation into bankruptcy should the judge not lean their way.

The judge reiterated that Caesars may have violated the federal Trust Indenture Act by attempting to renege on repayment guarantees. The bondholders are charged with proving that Caesars’ change to the original contract was illegal.

During arguments, Scheindlin rejected Caesars’ assertion that the bond contract was not intended to insure payment, citing potential illegality if Caesars provides “no practical ability to receive payment.”

The operating division of Caesars filed Chapter 11 reorganization in January with the intention of converting the unit into a real estate investment trust (REIT) to reduce debt by $10 billion. The bondholders claim that prior to filing bankruptcy the corporation relocated profitable properties out of the operating division.

Barring appeals to Judge Scheindlin’s ruling, the boldholders have until October’s court date to produce proof that Caesars property shuffling make it impossible that the bondholders would ever be repaid.

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