Bankrupt B.B. King’s blues club, Mirage in invoicing dispute

By Steve Green

Friday, Feb. 25, 2011 | 5:15 p.m.

Details surfaced Friday on the dispute between the Mirage hotel-casino on the Las Vegas Strip and the bankrupt B.B. King's Blues Club at the casino.

B.B. King's Las Vegas club and restaurant filed for bankruptcy reorganization last week in Memphis. The club remains open.

The bankruptcy filing at the time listed a disputed debt of $585,000 to the Mirage.

The nature of at least part of that dispute, from the point of view of B.B. King's, became apparent Friday when B.B. King's filed a complaint against the Mirage in the bankruptcy case claiming the Mirage has failed to justify invoices to the club for support services.

The complaint focuses on the club's five-year lease for 11,155 square feet of space in the hotel-casino.

It says that since the club opened in November 2009, the Mirage has been billing the club for "stewarding" services including cleaning its office space.

The complaint also says that as part of the stewarding agreement, dishwashing facilities at the hotel-casino have been shared by the B.B. King club, Mirage's room service operations, its buffet and its Samba Brazilian steakhouse.

From November 2009 through January 2011, the Mirage invoiced B.B. King's more than $486,000 for stewarding services, the complaint says.

"Plaintiff disputed the first bill and continued to dispute the basis and reasonableness of these charges," Friday's complaint against the MGM Resorts International property says.

The issue for B.B. King's seems to involve the dishwashing operation as the $202 monthly office cleaning fee is not in dispute.

"Plaintiff has sought to verify from defendant that the charges invoiced to it for stewarding services represent plaintiff’s cost, distributed equitably among plaintiff and the hospitality services owned and operated by defendant, that utilize those services. Defendant has failed and refused to make an accurate accounting to plaintiff regarding those charges," says the complaint, which asks the bankruptcy court to order the Mirage to provide an accounting of the charges for stewarding services invoiced to B.B. King's.

Attorneys for the Mirage have not yet responded to the complaint.

It's likely the disputed $486,000 is just one of multiple financial issues for the club, which in its filing listed $3.764 million in debt and other liabilities against assets of $2.57 million.