Twenty miles outside of Las Vegas, two Texas billionaires set up camp—and construction—around the large artificial Lake Las Vegas, complete with upscale homes, high-end hotels like the Ritz-Carlton, “a recreated Mediterranean village, golf courses, and, of course, a casino” in the 1990s. It held enough promise for big names to buy into it, with Vegas-based singer Celine Dion purchasing a home in the development, for example, but the hope for the mini-city didn’t last. Going bankrupt in 2008, the entire development lost its viability after the Bass brothers pulled out $470 million from the investment in 2004, according to this article in the Star-Telegram. And while the bankruptcy and real estate lawyers in Las Vegas and Texas representing the parties in the case aren’t talking to press, they do report that a settlement has been reached in the long legal battle.
So what’s the inside story? The Bass brothers are citing the 2008 American housing market collapse as the reason for the Lake Las Vegas development’s bankruptcy, but others—including some real estate lawyers in Las Vegas familiar with the area and timeline—see the market collapse as a convenient coincidence on which the Texas investors blamed their failing project. The unsecured creditors watching the brothers take out the $470 million in 2004 tended to agree, and filed a lawsuit to that effect.
With so much money at stake, the case was dubbed “the mega-case” on the Las Vegas Bankruptcy Court website and was scheduled to go to trial later this month. With attorneys on both sides of the case probably preferring to avoid a trial, they reached a settlement—or at least according to federal court filings reviewed by the owner of the Star-Telegram; “the judge approved the resolution in June, but the settlement has not been announced and the court date has not yet been taken off the docket.” Still, it may be close enough to count, especially with the real estate lawyers in Las Vegas following the case acknowledging that the defendants in the case including the “famously press-shy Bass family” and their lawyer would avoid embarrassment by settling.
Everything about the settlement, though, is confidential. That is, no one is talking. Court documents don’t specify the amount of the agreement, longtime Bass attorney Dee Kelly, the trustee in the case as well as his lawyer, and a Houston attorney representing the defendants all denied comment on the case. Credit Suisse, the multinational financial company making the loan to the Bass brothers are the plaintiffs in the case, but have also been quite on the details.
Interestingly enough, the Lake Las Vegas settlement has rebounded. Real estate lawyers in Las Vegas like Michael Van and bankruptcy lawyer James Shea could attest to the “mind boggling” scope of the project development. A small city “out of nothing, out of rock,” in the desert, an offshoot of Las Vegas, the housing development wasn’t abandoned, but is being reborn. “Another upscale hotel replaced the Ritz-Carlton, Dion is building an even bigger home there, and for some people, it is still a place of dreams.”