Saturday, July 15, 2000
Copyright © Las Vegas Review-Journal
Mesquite Star claims combined
Some claims brought against the closed casino can be heard and given priority by one judge.
By Jan Hogan
lasvegas.com Gaming Wire
District Court Judge Michael Cherry Friday agreed to consolidate financial claims cases brought by Virgin River Casino Corp. and A.F. Construction against the Mesquite Star.
Friday's hearing was scheduled to decide if claims brought by the two companies could be heard by one judge and also to decide which side's claim had payment priority should the now-closed hotel-casino be sold.
"I will grant the consolidation but I'm going to put this down as a status check," Cherry said, meaning he would wait to see if there were any developments.
The property has issues that have to be heard in both bankruptcy and civil courts, plus the state Supreme Court has a decision pending in the case. Cherry said he is precluded from making any judgments until the high court lifts a stay on that case.
Cherry said it would be about three weeks before he would hear the case again.
Doug Gerrard, lawyer for Virgin River, said he filed a motion earlier this week to postpone the construction company's foreclosure sale, which had been slated for later this month.
"I brought the motion because my client has a first deed of trust with priority over A.F. Construction," Gerrard said. "We're looking to recover the balance due on the original $5 million note."
Besides Virgin River's suit, there are three other large claims against Mesquite Star.
A.F. Construction, which built the hotel-casino, is seeking about $900,000.
More than 100 employees allege their health benefit payments were diverted and want relief from the nearly $750,000 they face in denied medical claims.
There is a second mortgage held by investors Richard Kelley and the estate of Richard Tam totalling about $10.5 million.
There are also smaller claims against the 210-room property.
Mesquite Star, 80 miles north of Las Vegas, opened about two years ago but always struggled to stay afloat. Parent company NevStar Gaming & Entertainment filed for Chapter 11 bankruptcy protection on Dec. 1 listing liabilities of $23 million and assets of $22 million. The court rejected NevStar's reorganization plan and put the property into receivership. It closed in early March.
This story is located at: lvrj.com |
