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Nov. 01, 2008
Copyright © Las Vegas Review-Journal

CRAZY HORSE TOO: Strip club granted more time

Court filing submitted by U.S. Marshals Service accepted

By ALAN CHOATE
REVIEW-JOURNAL

There might yet be hope for the shuttered Crazy Horse Too topless club.

The U.S. Marshals Service, which seized the club as part of a criminal case against its former owner, received more time Friday to pursue several options, including selling the club or applying for alcohol and exotic dancing permits from the city of Las Vegas.

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    • It's not clear from court filings whether the Marshals Service would actually operate a topless club or whether the permits would simply serve to enhance the value of the property, which has seen its price tag drop from $48 million to as low as $4.6 million now.

    They asked for more time after Security Pacific Bank, which has an interest in the property, asked a federal judge for permission to foreclose on it. The bank said the club's lack of permits and Southern Nevada's real estate slump means it needs to take the property now.

    "Security Pacific should not have to wait on the sideline while its secured asset wastes away," the bank's filing says.

    "At its present value the United States will not recover any of the forfeiture judgment ... [and] as a result of the precipitous decline in the Crazy Horse's value, Security Pacific may not even recover the value of the indebtedness."

    The federal government, meanwhile, disputes the bank's appraisal of the property and will argue that the city of Las Vegas should never have taken away the alcohol and dance permits.

    Former club owner Rick Rizzolo pleaded guilty to tax evasion in 2006.

    The club was supposed to be sold to pay millions of dollars in judgments and fines, but was not, and in August 2007 the federal government seized the club to satisfy a $4.2 million cash forfeiture order.

    One buyer originally was going to pay $48 million, and other subsequent offers ranged from $30 million to $33 million. None of them closed.

    In June, the Las Vegas City Council refused to extend a June 30 deadline for the relevant permits.

    City officials said that because those uses had been "grandfathered" in before current zoning codes, it would be very hard to reopen the club as an exotic dance establishment.

    "The already declining value of the property plummeted," the bank's filing states.

    It hasn't gone down as much as the bank says, according to the U.S. Marshals Service. Recent appraisals put the value of the property at $7 million without a tavern license and $11 million with one.

    There's plenty of people in line for the proceeds of any sale. Security Pacific holds a $5.9 million note.

    A man who was paralyzed in a fight at the club is owed $9 million of a $10 million judgment.

    The Internal Revenue Service has a $1.7 million stake, and Las Vegas has a $2.2 million lien on the property.

    The Marshals Service has also hired a land use attorney to argue that the Crazy Horse Too is, in fact, a "conforming use" that was not subject to the June 30 deadline.

    If the feds do operate the club as an adult business, something Las Vegas Mayor Oscar Goodman has encouraged, it won't be without precedent.

    The IRS became entangled with the Mustang Ranch brothel in the 1980s and at one point tried to have a bankruptcy trustee operate it when taxes continued to go unpaid. It didn't work out, and the property eventually was auctioned off.

    Contact reporter Alan Choate at achoate@reviewjournal.com or 702-229-6435.

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    Da Good Old Days wrote on November 03, 2008 09:31 AM: No Matta What, Dat place will nevah be da same. There use ta be a dried up old bar rag dat use to perform da oral out behind the Dumpsta behind Buffalo Jim's joint. It got kinda stinky out dere because of the bodies Mo use to trow out onto da tracks after he snapped dere necks for not payin for Mikki's services. Her Phat Husband Artie could nevah figure out how to get em to pay in advance. Geez I miss dat joint. i think Mikki was actually a man. Poor Artie. Phat Bastad.


    ..temujin ... khan of the yakka mongols ... wrote on November 01, 2008 09:50 PM:

    ...Yo Judge....Hire Vinny and Michael
    Boston Bob, Daren and all the people that ran it before..They will get it up to a valuable price again.. I patronized it for more than a decade..

    ...I had a disco and restaurant for eight years in the seventies and its a "on your toes business" out there folks..

    ...With the volume of business they had you can expect a troublemaker on occasion from time to time. Several times I warned personnel, in there, to watch certain people before they started an incident..Believe me it was a well run club and these stories of brutality and open sex are simply exaggerations told by people who probably were never in the club..

    ...Local press stories killed the reputation of the club that once employed hundreds of girls a week..

    ...I haven't had six drinks elsewhere in town at the new "gentleman's clubs"
    since "The Horse closed, and miss the camaradary of the Staff, Dancers and locals that called the "Horse", home..


    Michael Ray Thompson wrote on November 01, 2008 06:50 PM: Wow, only in Las Vegas. However, knowing about the Las Vegas way of doing things, I can't imagine that some force wouldn't have tried to get the Crazy Horse management in line just to keep the business open. Beyond that, adult businesses don't have a whole lot of respect for their patrons.


    The Vegas Way wrote on November 01, 2008 08:20 AM: As Vegas continues as the rip off capital of the world, casinos and business owners continue to cry over slumping profits.

    Why would people want to come here?
    To get ripped off by the unscrupulous that now have control of this city/state?

    Our legislators write laws that are grey and unenforceable. One must ask, Is that by design?

    There comes a point and time that you run out of people to scam. Either from personal experience or word of mouth it gets around.

    Come to Vegas... Get hepatitis from your colonoscopy, meet the medical mafia, end up in staged/rigged litigation, get your neck broke at the local strip club, have your HOA hijacked.....

    Get your picture taken with our mobbed up mayor.

    The Vegas Way!


    ET wrote on November 01, 2008 07:46 AM: Burn it to the ground,it's has a nasty,history,We agree with, Waste of taxpaper money.


    Waste of taxpayer money wrote on November 01, 2008 07:29 AM: Why are the feds wasting so much time on this. Complete the terms of the plea agreement or lock them up. Look for personal assets that will satisfy the debt.


    Topless wrote on November 01, 2008 06:55 AM: what ever happen to the bouncer who broke that poor guys neck from Kansas which left him paralyzed?


    Vegas Vic wrote on November 01, 2008 02:54 AM: With the seeming lack of "enthusiasm" in attempts to sell the property, it's no wonder that interest there has waned to the point of no one giving a damn what happens to it...with the possibility of “Buffalo” Jim Barrier's relatives due to his former repair shop being at the north end of the building complex. No one was able to close a deal on the building when it still had its licenses so now it's worth nothing more than any industrial building in the area. With the current economic situation there's little to no chance for anyone to be closing any deals on this property whether its licenses are reinstated or not. Maybe it's time to just bulldoze the building, much like the fate of the old Crazy Horse many years ago.