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Tuesday, June 18, 2024 | Back issues
Courthouse News Service Courthouse News Service

No Commission for $150 Million Casino Sale

LAS VEGAS (CN) - The new owners of the former Hilton Hotel and Casino in Las Vegas need not pay a $1.5 million commission to a woman who claimed her late father brokered the deal, a federal judge ruled.

Now called the Westgate Las Vegas Resort & Casino, the casino is headquarters hotel for Las Vegas Convention Center. Westgate Resorts bought the property this year at a reported sale price of about $150 million.

In its original lawsuit, filed in August, Resort Properties of America claimed it brokered the deal through its president, David Atwell, who was a licensed real estate broker. Resort Properties claimed it had contracted with Westgate in September 2011 to help it buy a hotel.

But Atwell died in November 2013, and his daughter, who took over the business, sued to collect the 1 percent commission the she said her father was promised.

U.S. District Judge James Mahan dismissed the complaint without prejudice on Dec. 1.

Mahan found that Resort Properties did not incorporate until March 2013, and so could not have entered a contract with Westgate in 2011.

"Plaintiff alleges that RPA provided brokerage services through a licensed broker, Mr. Atwell," Mahan wrote in a 7-page order. "While plaintiff's complaint alleges that RPA and Westgate contracted for real estate broker services, plaintiff fails to allege that it is a licensed real estate broker."

Westgate owner and president David Siegel told Courthouse News that Resort Properties of America had nothing to do with the deal - that it went through a different broker. Nor, Siegel said, had Westgate ever agreed to pay Resort Properties a 1 percent commission.

"David Atwell and his daughter, Heather Atwell, had nothing to do with the sale," Siegel wrote in an email to Courthouse News.

"I never had a deal (with the Atwells), I never reneged on it," Siegel told Courthouse News in a telephone interview. "He never lifted a finger to help me buy that.

"I've been in business for 45 years and I've got a stellar reputation."

In his "Background" summary of the case, Judge Mahan referred repeatedly to "Document 1," which was the original complaint. It was filed in state court and removed to Federal Court.

Citing Document 1, Mahan wrote that Westgate Resorts had agreed to pay a 1 percent commission on any property it bought with David Atwell's assistance - a claim that Siegel denied.

Heather Atwell claimed that Westgate acknowledged to her in May this year that it owed her 1 percent commission, according to Judge Mahan's summary of the original lawsuit. ) "These references by the court were based upon the allegations of the complaint alone, and there was not a determination made that the facts as alleged were truthful," said Siegel's lawyer.

Westgate sought dismissal due to Resort Properties' failure to state a claim upon which relief the court can grant relief.

For relief to be granted, Westgate claimed, Nevada law requires Resort Properties to have been a licensed real estate broker at the time the commission deal was made. But Resort Properties did not incorporate until March 2013, Westgate says, and did not exist when the commission deal was made with Atwell.

Mahan agreed.

Resort Properties claimed that a 2014 fee agreement entitles the company to the 1 percent commission. Mahan found that the complaint "still fails to allege any facts supporting licensure. Instead, plaintiff alleges that it is owed a commission based on the work of Mr. Atwell, and that he was acting as a licensed real estate broker at the requisite time."

"Mr. Atwell is now deceased," Mahan wrote. Resort Properties' "complaint fails to demonstrate how [it] became entitled to Mr. Atwell's commission, nor does it allege any authority to assert any claim on behalf of Mr. Atwell's estate."

Saying Resort Properties did not state any "plausible claim to relief," Mahan granted Westgate's motion to dismiss.

"While my client is deeply sorry for Mr. Atwell's untimely passing there is simply no basis for a commission claim," said Siegel's lawyer, Michael Marder. "In fact a commission was paid to another broker."

The Westgate's 30-story hotel and casino is one of the world's largest hotels, with 2,956 rooms and 305 suites.

Originally named the International, and owned by entrepreneur Kirk Kerkorian, the hotel was the Las Vegas home to Elvis Presley, who lived in a penthouse suite on the 30th floor and performed hundreds of sold-out shows in its theater. Liberace performed many sold-out shows on the same stage, and the resort boasts of having the world's largest race and sports book. Hilton Hotels bought the property in 1970 and changed its name to the Las Vegas Hilton. The property underwent another name change in 2012, becoming the LVH-Las Vegas Hotel & Casino after Hilton Hotels ended its decades-long relationship with the property, which by then was owned by Resorts International Holdings.

CORRECTION: An earlier version of this article should have more clearly attributed all the factual allegations about the merits of the case. The allegations repeated in the article, including but not limited to the allegations that Resort Properties of America brokered the deal through its president, David Atwell, and that a Westgate Resorts official acknowledged that it owed Resort Properties a commission, were set out in the court's decision, which the court - in ruling on a motion to dismiss - took from the complaint of plaintiff Resort Properties. The allegations in the complaint have not been proven true in the case, and are disputed by Westgate and its President and CEO, David Siegel.

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