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Unhappy partners, creditors sue Moulin Rouge developers

People trying to revive the former Moulin Rouge casino hotel near downtown Las Vegas will need to overcome more than a blighted neighborhood and battered credit market to succeed.

They're also facing lawsuits from disgruntled business partners and alleged creditors who say Moulin Rouge Development Corp. owes hundreds of thousands of dollars for old loans and busted deals.


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  • In Clark County alone, there are currently five active lawsuits against the company and its top executives, including one by a man who claims he is a 25 percent partner and expects to share in the proceeds when and if the $500 million redevelopment project gets off the ground.

    "They don't talk to me anymore right now," said Michael Glenn Jr. of Chicago about Moulin Rouge partners Dale Scott and Chauncey Moore.

    Glenn says in 2005 he purchased a 25 percent stake in the project on Bonanza Road. "I think they figure if they ignore me, I am going to go away. It doesn't work that way."

    Moore and Scott did not respond to interview requests made through a spokesperson for the company.

    In an e-mail Scott wrote: "We will not comment on the lawsuits other than to say that they are not valid claims, and that is why they are in court. However, like piranhas, those that smell the potential success of the Moulin Rouge will do anything they can to stop its progress."

    An attorney for the Moulin Rouge said one of the lawsuits, filed by plaintiff John Whisenant, deals with a loan that had an unreasonable interest rate. The attorney, Erika Pike Turner, said the original loan of about $250,000 has ballooned to more than $1 million with interest in less than a year under a contract she said is not legally valid.

    "They don't dispute they owe him the principle amount," she said. "We are hoping we can work out something."

    Whisenant's attorney, Kurt Bonds, defended the deal, which included interest of $2,667 per day.

    "Whatever they negotiated, they negotiated," Bonds said. "My client gave them the money, they used it, they haven't (given) it back."

    In the case by Glenn, a real estate developer, Glenn says he paid $250,000 for a stake in the company.

    He said a third party introduced him to Moore and Scott and that he was happy to invest in their plan to develop a resort on the site of the first racially integrated casino in Las Vegas.

    "I liked pretty much everything about it," Glenn said.

    Although Moore and Scott have presented a number of different proposals for the site, the basic idea has remained the same. The men say they want to revive the spirit of the Moulin Rouge as it was during its brief life in 1955 -- a hip hangout for black and white gamblers, revelers and performers.

    At the time, Las Vegas was segregated and the Moulin Rouge was a place where performers such as Frank Sinatra, Sammy Davis Jr., George Burns and others would mingle, sing, dance, drink and gamble.

    The project appears to have broad support in the community. About 50 residents turned out in support for it at an April 3 meeting of the Las Vegas City Council. The council voted to approve three procedural items the developers needed for the site to be able to host a resort.

    Councilman Ricki Barlow, who represents the area that includes the Moulin Rouge, said support for the project hasn't waned since April.

    "It has a lot of rich history," Barlow said of the project. "It will drive more redevelopment and development efforts in that area."

    Glenn said he thought he was buying a stake in that optimistic vision. But so far that hasn't been the case.

    He said Moore and Scott have avoided contact and didn't include him in a decision to bring in another company to steer the project. The company, Republic Urban Properties, is a real estate development firm that specializes in urban revival and has a $4 billion property portfolio in California, Washington, D.C., and other states.

    "They keep telling me one thing and doing another," Glenn said.

    Michael Van Every of Republic Urban said he had no comment on the lawsuits.

    In another case, Bank of America alleges Moulin Rouge Hotel and Casino owes about $12,000 for banking and financial services. Attorneys for the plaintiff did not return a call for comment.

    Another case by plaintiff Siavelis Construction Management Services says Moulin Rouge officials owe more than $10,000 for services. There is also a lawsuit by plaintiff Kenneth Black who says he loaned the firm more than $10,000.

    Glenn's lawsuit was filed in March 2006, and is the oldest among the five active cases. The most recent is the case by Bank of America, bearing a court filing stamp dated July 1.

    Glenn says his lawsuit is a way to protect his stake in the outcome, which he said he hopes is a prosperous resort.

    "If it is going to be a successful project, I might as well stay in," he said.

    Contact reporter Benjamin Spillman at bspillman@reviewjournal.com or 702-477-3861.

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    Flashy wrote on August 04, 2008 09:35 AM: W. T. F.

    Who agrees to borrow 1/4 million bux with interest pegged at about 1% daily ? Aren't there laws re: usery ? Loan Mobbed-up loan sharks on the streets of major cities traditionally charge 5 for 5 on a weekly basis and that is almost 3% daily.

    Well ... maybe paying a per annum interest rate that is North of 350% is legal in Nevada.

    R O T F L M A O


    Shelly wrote on July 31, 2008 09:58 PM: “Ahhh...its a joy to know that in 2008 the proverbial boot is still on our proverbial necks! So only certain people are allowed to prosper. How much does Harrahs or MGM owe its investors? Obama reacts to the machinations of a conservative spin cycle as “baseless” and “baloney”. I too, see the RJs attempt to smeer the Moulin Rouge project as “baseless” and “baloney” as well. Change is coming folks; swift and smooth. Some people don’t like change. That project stands as a gateway toward further developments in the Northern part of the valley. The race is not to the swift RJ, but to those who can endure to the end. I say that also to those disgruntled investors who might be feelin a slight case of the economic pinch. To be an investor is to be focused and prepared. Be wise and be smart when you want to level criticism or you want to howl your point of view. Didn’t wanna reach out to the project reps…you wanna go to the RJ….consider the source…my gawwd!!


    douglas wrote on July 31, 2008 07:19 PM: interesting spin response from the m.r. lawyer.

    if the stiffed 25% investor thought he had such a piece of the "potentially successful" project, why would he then "try to stop the progress" ? rather it seems that he should be on site daily giving the contractors a hand.

    instead it sounds like those who bought in notice that the titanic is going down again, for the last time and they want to be first in line for the judge's distributions.

    if they proceed, i hope they already have approved by plan review, some interlocking fire, gun emplacements on the perimeter to control the neighborhood "clientele".


    cotton fairbanks jr wrote on July 31, 2008 05:00 PM: so once again a story portrays the unusual suspects of westside development as "non-paying" scoundrels. Ladies & Gentlemen, welcome to a pure american story. People who are "all in" and who are attempting to provide a solution, lets throw gobs of mudballs at them. This happens in every major and minor city...cept usually you have more than one paper giving an opinion...grow up Las Vegas. I believe this story has a great ending...might be a best seller. Remember, one view of one story hath not a novel make...


    Joel Jarvis wrote on July 31, 2008 04:13 PM: Dale Scott and Chauncey Moore have over the years encountered many men who would like to TAKE as much as they can from them on a project that WILL eventually be built with the RIGHT investors who are NOT opportunists.

    Many people see the project as a potentially successful venture and a few seem to think by doing some FAVOR or loaning some money to this project they can OWN IT for themselves, that is just not the way it works.

    Greedy outsiders will never own the Moulin Rouge, only local long term workers/owners/serious investors with a bonafide stake will see the project to completion.

    These suits are a joke. Period.
    Joel Jarvis


    cotton fairbanks jr wrote on July 31, 2008 02:29 PM: So once again a story portrays the main source of uptown development as non-paying scoundrels. Ladies and gentlemen, welcome to the pure american story. Someone wants to do good and is successful doing good but then if it is good, lets throw huge balls of mud on it. Happens in every city in every hamlet...usually you have more than one paper reporting against the opinions of one paper. Time to grow up Las Vegas!! Im sure there are quite a many story to tell on the strip...we'd love to know how all development happens...might even be a best seller. One view of one story hath not a novel make...


    litigator wrote on July 31, 2008 11:16 AM: Sounds like their is more to the story than reads in the press. Sombody obviously did not do their homework. Why would Republic Urban enter as a development partner if Glenn comments are correct. Sounds like sombody did not perform to their responsibility and it certainly was not the moulin rouge members


    Bonds Fan wrote on July 31, 2008 06:30 AM: Kurt Bonds is a basketball god. He has the coolest and loudest nike basketball shoes and the moves to back it up. I don't know what type of lawyer he is, but man can he play some b ball. The world would be a better place if there were more attorneys like Bonds that can not only fend off the attacks of oposing council, but overcome being double and even triple teamed in a pick-up game