Las Vegas nightclub execs in legal battle over club profits

By Amanda Finnegan

Published Thursday, Oct. 14, 2010 | 12:08 p.m.

Updated Thursday, Oct. 14, 2010 | 3:37 p.m.

Nightclub executives Jesse and Cy Waits are claiming that nightclub impresario Victor Drai didn’t pay them their share of profits from the nightclubs they managed, according to a lawsuit filed this week in Clark County District Court.

The Waits brothers are suing Drai and his related companies for alleged breach of contract, misrepresentation and deceptive trade practices, among other claims. Drai hadn't responded Thursday afternoon to a request for comment.

Jesse and Cy Waits’ business relationship with Drai began in December 2006 when they entered into an agreement to manage Drai’s nightclubs, which grew over time to include Drai’s Afterhours at Bill’s Gamblin’ Hall, Tryst at Wynn and XS at Encore. That agreement ended when Drai severed ties with Wynn Resorts in August and the Waits brothers were left as managers of the club.

On the day of the announcement of the Wynn-Drai split, Cy Waits was arrested with girlfriend Paris Hilton on the Las Vegas Strip on drug-related charges. Wynn Resorts later announced Cy Waits had “separated” from the company, but Jesse Waits still remains at his post.

Under the agreement with Drai, Jesse and Cy Waits were to receive 16.66 percent of the monthly net profits from Tryst and XS and 33.33 percent from Drai’s Afterhours, according to the lawsuit.

They were also to receive 49 percent of the net profits and employee compensation at Drai’s Hollywood in Los Angeles, which they also managed, the lawsuit states.

The lawsuit claims that beginning in July 2010, Drai failed to give the brothers their share of the net profits from XS, Tryst and Drai’s Afterhours.

The lawsuit also claims Drai failed to compensate the Waits brothers for their efforts at Drai’s Hollywood, but does not give a timeframe.

Jesse and Cy Waits are seeking more than $3 million in damages.