Station Casinos Face Legan Action
One of Las Vegas’ longest standing and respected partnerships is under stress. GCR Gaming, an affiliate of the Greenspun Corp., which owns and operates media, land development and gaming companies, filed a motion with bankruptcy court Thursday accusing Station Casinos, which is owned by the Fertitta family, of “wrongdoing” and of “flagrantly and continuously” breaching its “contractual and fiduciary duties” in their joint-venture partnership of the Green Valley Ranch Resort. Station Casinos said the “threatened lawsuit is nothing more than a desperate and improper attempt by the Greenspuns to gain leverage against Station in our ongoing restructuring discussions with Green Valley Ranch’s creditors. We intend to vigorously contest the Greenspuns’ baseless claims.” Kasowitz replied with, “This motion was filed not to gain leverage in any restructuring discussions or any bankruptcy proceeding. That has nothing to do with why the motion was filed. The motion was filed because of these really egregious breaches of the operating agreement and of the fiduciary obligations that Station has engaged in. Their conduct left GCR with no choice but to file the motion, and we fully expect that we’ll be able to obtain the remedies that we’re seeking.”
The controversy continues when looking at the timing. The law suit was filed immediately following the GV Ranch Station decision to file for Chapter 11 bankruptcy protection. GCR Gaming contends in the filing that its partner “improperly attempted to forestall the consequences of its wrongdoing through the bad-faith filing of its Chapter 11 petition.” In the filing, Greenspun said the Feb. 4 meeting was to give Fertitta a chance to explain Station Casinos’ actions before Greenspun began legal action to remove the gaming company as the resort’s manager. According to Greenspun, Fertitta denied the company had engaged in any misconduct and promised to fully disclose details about its actions.”However, over the course of the following week, Mr. Fertitta and his representatives at Station refused to supply such information, notwithstanding my repeated requests,” Greenspun’s filing said. The property, which opened in December 2001, has more than $770 million in debt, including a $523 million loan maturing in 2014. It also has a $250 million loan due in 2014.
