Wednesday, Nov. 10, 1999 | 10:46 a.m.
Nevstar Gaming and Entertainment Corp. is seeking a court order to force Desert Mesa Land Partners Ltd. and its partner TSRS Inc. to honor an agreement granting Nevstar the right until February 2000 to buy an indirect 20 percent stake in Desert Mesa's property in North Las Vegas.
In a Clark County District Court suit, Nevstar alleged Desert Mesa had reneged on the agreement after Nevstar paid legal costs to sue the City of North Las Vegas, seeking to reverse the city's decision in October 1998 that denied a request for a special-use permit for the proposed casino.
"Nevstar is trying to get the dispute resolved with Desert Mesa. It can't go forward with the project until this is resolved," said Stephen Peek, Nevstar's attorney.
Nevstar wanted to build Nevstar 2000, a $140 million hotel-casino and entertainment center at Martin Luther King Boulevard and Coralie Avenue by 2000. Plans for the 35-acre complex include a 200-suite hotel, a 37,000-square-foot casino, a bowling center, a 12-screen movie theater, an arcade, retail shops, restaurants and meeting rooms.
Though the project lies in the City of North Las Vegas's resort development zone, the City Council had voted down the project after some 50 residents protested its construction, citing concerns over possible increased traffic and crime as well as a drop in property values and possible future expansion of the casino.
But the litigation was successful and in February this year, the city was ordered to issue a special-use permit for the proposed gaming project because the court ruled Nevstar was in compliance with the city's master plan and the city was wrong in denying the permit.
But Nevstar alleged it was notified on Sept. 22 in a letter from Desert Mesa's counsel that its option to buy the indirect 20 percent stake was void.
Nevstar said it agreed on Sep. 15, 1998, to undertake litigation costs because it had already made significant investments to acquire the property and had also relied on Desert Mesa's indications at the time of its purchase on April 23, 1996, it could be used and developed for gaming projects.
The suit said Desert Mesa allegedly agreed it would sell 33 acres of its 95-acre property instead of the originally planned 25 acres, and the Sept. 15 agreement would be extended beyond Dec. 31, 1998, for one year after a final resolution of the suit against the city.
The suit said the parties allegedly agreed Nevstar will receive credit for all litigation expenses as an offset against the development funds it had to make on the property.
Ian Ross, president of TSRS, a general partner of Desert Mesa, declined comment. Desert Mesa's attorney Stan Hunterton, could not be reached for comment.