Alpha Hospitality Corporation Announces Catskill Lawsuit Moves Forward.

Business Editors

NEW YORK--(BUSINESS WIRE)--May 16, 2001

Alpha Hospitality Corporation (NASDAQ - ALHY; BSE - ALH; WARRANTS: OTCBB - ALHYW; BSE - ALHW) ("Alpha") announced today that the United States District Court for the Southern District of New York has issued a decision on the lawsuit brought by Catskill Development, L.L.C. ("Catskill") and others against Park Place Entertainment Corp. ("PPE").

In the decision the Court upheld Catskill's right to proceed with their claim alleging interference with their prospective business relationship with the St. Regis Mohawk Nation.

Although the court dismissed other theories that Catskill had asserted, this ruling sustains Catskill's claim for interference with its prospective business relationship, for which it has alleged damages of $2.1 billion. An Alpha spokesman stated, "We are very pleased with the Court's conclusion that Catskill has properly plead a claim that Park Place did indeed interfere with the business relationship between Catskill and the Tribe. With this ruling we now look forward to conducting pre-trial discovery and bringing our case before a jury soon as possible."

To the extent the content of this press release includes forward-looking statements, they involve risks and uncertainties that are described from time to time in the Company's reports filed with the Securities and Exchange Commission. The Company wishes to caution readers not to place undue reliance on such forward-looking statements, which statements are made pursuant to the Private Securities Litigation Reform Act of 1994, and as such, speak only as of the date made.