Judge keeps lawsuit involving Simon alive-WEB ONLY

A Las Vegas casino and Indianapolis-based Simon Property Group Inc. lost a bid last week to throw out a hip hop nightclub’s lawsuit alleging it is being discriminated against because most of the patrons of the Vegas establishment are black.

U.S. District Court Judge James Mahan said it was too early to make a decision until he hears more about Poetry nightclub’s claims of corporate racial bias against Caesars Palace, the Forum Shops and property owner Simon.

“There’s enough here that it survives a motion to dismiss,” Mahan said from the bench March 12 at the end of a one-hour procedural hearing.

The judge said that the civil lawsuit was still in early pleading stages, and called for written motions before scheduling more arguments.

Club owner Phase II Chin LLC, in a civil lawsuit filed Feb. 7, 2008, seeks unspecified monetary damages and orders prohibiting “racially-motivated” discrimination by the corporate entities.

“They don’t want black patrons in this establishment,” club attorney Harold Gewerter told the judge Thursday. “They don’t come out and say they don’t want minority patrons in there. But they show it with their conduct.”

Caesars, Simon and the Forum Shops deny the bias claims, and lawyers argued that the case amounts to a lease contract dispute. They said Poetry was operating under an illegal sublease with the Wolfgang Puck restaurant, Chinois.

“Any claims of any racial bias are outrageous and completely false,” Gary Thompson, spokesman for Caesars Palace owner Harrah’s Entertainment Inc., said in a telephone interview. “The actual facts will come out as the case proceeds.”

Lawyer Charles McCrea Jr., representing Forum Shops and Simon Properties, said there was no evidence of bias in the four breach-of-lease notices he said the property owners sent to Chinois.

“We have a right to notify them the management contract violated the lease,” McCrae said. “Nothing in those notices alludes to race or demography.”

Caesars lawyer Steve Morris said the casino was even further removed from any relationship with the club.

“There is no contract with Caesars,” Morris told the judge, arguing that without a contractual relationship between the club and the casino, there could be no bias.

Club representatives say they have a management contract, not a sublease, to operate an after-hours club upstairs from Chinois. Gewerter argued that made the club a “third party beneficiary” of the Chinois contract with Forum Shops, Simon and Caesars.

The club, initially called OPM, opened in May 2003. The lawsuit alleges that by January 2005, Caesars, Forum Shops and Simon began “an ongoing campaign of harassment and misconduct” to force the club out.

Club manager Michael Goodwin said outside court Thursday that because his club caters to a black clientele, casino and mall managers blame it for “every negative activity in Las Vegas and around Caesars Palace having to do with African-American people.”

Goodwin denied incidents that officials cite involved club patrons, and said owners of the casino and upscale 160-store mall also imposed prohibitively expensive security requirements as a condition of allowing entry to the club through the main Forum Shops concourse – which Goodwin called “the only dignified way to enter.”

Goodwin said he employs 30 security staffers inside the club and hires four armed Las Vegas police officers per night outside the club, which is open 10 p.m. to 6 a.m. four nights a week. He said he can’t pay what he called “impossible money” for more.

That means patrons in trendy club clothing have to enter by a back door and an unsightly litter-strewn service hallway.