Vegas Nightclubs Boogie Into Bankruptcy
By Melanie Cohen
Friday, November 13, 2009
Wondering how a nightclub boasting the combination of “the ethereal whimsy of South Beach” and “dramatic whiskey a-go-go elements” ended up in bankruptcy? So were we.
Earlier this week, Privé Vegas LLC, which owns nightclubs Privé Las Vegas and The Living Room, filed for Chapter 11 in U.S. Bankruptcy Court in Miami. Court filings report assets of less than $50,000 and debts of $1 million to $10 million, as well as 50 to 99 creditors. Vegas Nightclub Partners LLC, the company’s largest unsecured creditor, is owed $2.2 million. William Richardson of Las Vegas and ADT Construction Group Inc. are each owed $1.6 million, though Privé Vegas disputes ADT’s claim.
In 2008, the clubs were cited for three violations by the Clark County, Nev., Business License Department, including permitting topless and lewd activity. In July, Clark County shut down Privé and The Living Room after the owners’ liquor license had been revoked. Both the clubs and the Planet Hollywood Resort, where the clubs are located, weren’t following the rules of a liquor licensee.
Roman Jones, Privé Vegas’ principal owner, told the Las Vegas Review-Journal in a text message that the clubs will stay open during reorganization. The clubs are currently staying open under a temporary liquor license while Las Vegas police conduct background checks on their new owners and managers, who took over following the closures. Judge Jay A. Cristol approved a motion Thursday to keep paying wages and benefits to 100 employees and 14 independent contractors of The Living Room and Privé Las Vegas, which last year hosted a “father of the year” award party for Kevin Federline, Britney Spears’ ex-husband and the father of her two sons.
Information From: The Wall Street Journal