Published July 11, 2012
LAS VEGAS – Amid a court battle over their stalled development plan, a company planning to turn entertainer Wayne Newton's Las Vegas estate property into a tourist attraction told a state court judge it will borrow $1 million for upkeep of the "Danke Schoen" crooner's 51 Arabian horses.
Clark County District Court Judge Elizabeth Gonzalez decided Tuesday not to give her backing to the loan sought by CSD LLC, saying she hadn't had time to fully review it.
Newton lawyer J. Stephen Peek welcomed the decision, the Las Vegas Sun reported (http://bit.ly/Nhjg6y). He said Newton's developer partners would have used Gonzalez's endorsement of the loan to push Newton and his wife off the 40-acre property.
The battle over the loan and the judge's rulings on other issues relating to Casa de Shenandoah illustrated a deteriorating relationship between the former Las Vegas Strip headliner and his estranged CSD business partner, Steven Kennedy, the Las Vegas Review-Journal reported (http://bit.ly/N3F46v).
CSD attorney Charles McCrea Jr. depicted the loan as necessary for CSD to pay an estimated $37,000 a month to board and feed the horses, as Gonzalez ordered last month. McCrea told the judge that CSD has put $30 million into the project and has no operating budget for the horses.
In a lawsuit and counterclaims filed since May, the two sides have traded allegations of breach of contract, fraud, mismanagement, animal abuse and sexual harassment.
Kennedy bought the sprawling compound for $19.5 million in June 2010 with the intent of building the Newtons a new $2 million home on the grounds and converting the gold-trimmed main house into a public "Graceland West" venue.
But Doreen Hartwell, a CSD attorney, alleged Tuesday the Newtons "took the $19.5 million and then basically hunkered down in the mansion," refusing to cooperate with the developer.
The project was supposed to have opened in February 2011, but Newton still lives in the main house with his wife, Kathleen McCrone Newton, and their 10-year-old daughter. The Newtons hold a 20 percent interest in CSD, and Newton has said he regrets going into business with Kennedy.
Peek said the real aim of the loan was to "try to get rid of the horses and squeeze" Newton and his family off the property. A default would set the stage for foreclosure, but Peek promised the Newtons would fight such a move.
In other rulings, Gonzalez dismissed Kennedy allegations that the Newton's dogs had attacked workers and that Newton sexually harassed female employees unless Kennedy supplies specific claims.