The plaintiffs in a lawsuit over a would-be casino resort dedicated to Elvis Presley have settled their litigation against the investment group that declared bankruptcy after the project failed. The group of plaintiffs, all of whom were shareholders in the company, will receive $950,000 as part of the settlement, a far cry from the $150 million in damages they originally sought.
The failed project first began when a company now known as Circle Entertainment Inc. purchased a plot of land on the Las Vegas Strip using a $475 million mortgage. The company was headed by an investor who owns the name and image rights to Presley, and the plan was to build a Presley-themed casino on the plot.
But the project ran into problems when the 2008 recession hit. Circle Entertainment defaulted on the mortgage and filed for bankruptcy in 2010. Shortly after that, shareholders of the firm’s parent company filed suit in New York. They accused the company’s main investors of purposely going into bankruptcy as a way of stripping the plaintiffs of their property rights to the land on the Strip.
The settlement, announced the week of Sep. 10, ends that litigation. As mentioned above, the plaintiffs will divide $950,000 among themselves. In exchange, they will dismiss their lawsuit and Circle Entertainment will not admit any wrongdoing. Settlement documents indicate that Circle Entertainment agreed to the settlement due to the uncertainty of what could happen in a trial, which is something that businesses should often consider.
It is not clear what plans Circle Entertainment currently has for the 17.72-acre plot.
Source: VEGAS INC, “Settlement OK’d in suit involving planned Elvis Presley resort,” Steve Green, Sep. 13, 2012
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