Inside Las Vegas: Crime, strip clubs, Mayor Oscar Goodman
Rizzolo's Going Away Party Backfires
By Steve Miller, AmericanMafia.com
Sunday, May 27, 2007
Buffalo Jim's Harassment Lawsuit may be reopened
LAS VEGAS - Last month's festive GoingAway Party held in Newport Beach revealed that convicted racketeer RickRizzolo and his lawyer Tony Sgro have a sense of humor. But italso revealed that the federal court has no funny bone after JudgePhilip Pro considered the party a reason for denying Sgro's motion tokeep his biggest client out of prison.
But that was not Sgro's only recent court motion that may come back toslap him in the face. Another motion that temporarily caused thedismissal of the harassmentlawsuit brought by Rizzolo's next door neighbor BuffaloJim Barrier is back in the spotlight. It may soon be reversed based on Sgro's own damning words. More on that later.
But first, the party.
The very private event attended by hundreds of SinCity and Orange County movers and shakers including JerryTarkanian, the husband of LV CityCouncilwoman Lois Tarkanian, was not intended to attract prying eyes.But despite hosts Rick Rizzolo and Freddie Glusman's best efforts,INSIDE VEGAS was there.
Just when it looked like Rizzolo's lawyers were about toget him a reprieve from having to turn himself in at the gate of TaftFederal Prison this Tuesday, Rizzolo's own sense of humor got intheway.
Two days before the party, Sgro filed a motion with JudgePro asking that his client be allowed to remain free until apurported deal to sell his Crazy Horse Too topless club goes through.In themeantime, Rizzolo told everyone he knows that his lawyer fixed it so hewould not have to go to prison, hence the faux Farewell Party.
Sgro's motion backfired whenFederal Prosecutors learned of the party in the May7 editionof INSIDE VEGAS.
Of course, no one actually knows ifor when the sale of Rizzolo's CrazyHorseToo strip bar will ever happen since Police Special Investigationsofficers told the city council that the purported buyer, a twicebankrupt guy named Mike Signorelli, can'tprove he hasthe money to match his offer of $45 million dollars. They also told thecouncil that Rizzolowas still in charge of the daily operation of the club despite ordersfrom the council and federal court to stay away.
So it looked like Sgro's motion to let his client stay on the streetuntil his club is sold was intended to be a permanent stay out of jailpass, but the judge didn't fall for it.
Two experts say the club is worth no more that $21 millionincluding the land and building, and the Nevada Dept. of Transportationplansto take a 23 foot deep slice of its' frontage for a roadwidening. Business has dropped to a trickle of what it once wasnow that the place is being closely watched by the Feds and peoplecan't be drugged or beaten into signing inflated credit card tabs.Also, the semenstained velvet seats that once served as a bordello in the VIP roomhave been shut down along with the limos parked behind the club thatwere mobile bed rooms. This means that Signorelli's $45 million dollaroffer is pure fantasy-- a ploy to keep Rizzolo out of jail, and to delay him having to payoff his court ordered debts.
But that didn't deter the city council from their political obligation togrant the permanent liquor license! They obediently voted unanimouslyto let the troubledbusiness stay open after 16 of its employees pleaded guilty to chargesincluding racketeering, and after their own city attorney and policetold them Rizzolo is still in charge. Voting with the majority was thewife ofRizzolo'spal and Newport Beach party goer former UNLV basketball coach JerryTarkanian. Despite saying otherwise, Councilwoman Tarkanian voted togive Rizzolo et. al. a permanent liquorlicense after previously voting to shutthe bloody place down.
Both her votes were used as reasons in Sgro's motion to let Rizzolostay on the street:
And had the judge granted the extension, I'm sure additional extensionrequests would follow because Signorelli is suspected of being only astraw man, and he obviously does not have the financial ability toclose the deal.
But the most interesting part of Sgro's motion is this sentence -- asentence that includes way too much information to be of benefit to hisclient:
Hello Mr. Sgro! Did you havewax in your ears when Judge Pro ruled that Rizzolo could not step footon his property and must remainout of the adult entertainment industry for the rest of his life? Whendid the judge say your client could have an ongoing business thatincluded the profit? Hello!
Sgro inadvertently revealed in the above sentence that Rizzolo neverrelinquished his interest in or control of the club -- the mainconditions of the plea agreement imposed by Judge Pro. Sgro's carelesswords did the oppositeof what he intended and sent his client to the slammer on Tuesday withno delays.
After the fun party, and with false confidence he was not going to havetospend a long hot summer watching Jerry Springer in the prison TV room,Rizzolo resumed his clandestine day to day operation of theCrazy Horse Too -- probably skimming the cash while Signorelli claimedto barely be making payroll. In the meantime, the city council timidlylookedthe other way.
Rizzolo may have been able to keep this scam going for years saying hewas just about to sell his club and dangling beatingvictim Kirk Henry in front of the judge and council members like acarrot, but then he threw that party and his plan to stay out of prisonsoon fell apart.
The council seems to be having a love affair with Rizzolo and hismoney.At the hearing that granted Signorelli a permanent liquor license,Councilman Steve Wolfson said Signorelli has "an unblemished financialrecord" after receiving copies of court documents from his twobankruptcies. It was also mentioned that the only way quadriplegic KirkHenry could be paid was if the club was sold. But no mention was madeof liquidating Rizzolo's personal assets that would more than cover the$9 million he still owes the Henry family.
Here's the Fed's response toSgro's motion to keep Rizzolo on the street, and their thoughts on theill-timed Farewell Party:
After reading Myhre's response, Judge Proimmediately denied Sgro's motion, and sent Rizzolo to pack his bags (gray sweats, whitesocks, white underware/boxers, white t-shirt, white or mostly blackshoes not worth over $100, a watch not worth over $100, and a necklacewith a religious item attached not worth over $100 according to arecently released Taft inmate.)
But Judge Pro's denial may be the beginning of the end of Rizzolo'spersonal fortune. If Judge Pro stays on course, the transferof most of Rick Rizzolo's personal assets to his ex wife just weeksbefore his 2005 indictment can be reversed. Rizzolo has over $17million in personal obligations that are supposed to be paid by June 30 throughthe sale of the Crazy Horse. If they are not paid by then,both Judge Pro and the city council have vowed to place a receiver inthe business to supervise liquidation.
I don't expect much from the city council, but Judge Pro's actions areless predictable. He doesn't have to answer to Mayor Oscar Goodman whowas Rizzolo'sattorney, or answer to Goodman'slaw partners who are well known political fund raisers and pals ofUS Senator Harry Reid -- someone else who pulls financial stringsaround election time.
Auctioning off the Crazy Horse is not all that the federal court canimpose on June 30. Since thetransfer of assets (another brilliant idea of Tony Sgro) occurredduring the federal investigation, and since Lisa Rizzolo was married toRick at the time of the damages, in acommunity property state like Nevada, his trust funds,cash, homes, cars, stocks, and bonds can be seized from Lisa to pay their court orderedobligations including Kirk Henry's past due medical bills, taxes,penalties, and fines.
Henry has yet to receive one cent of Rick or Lisa Rizzolo'spersonal fortune causing me to question why Henry's attorneys DonaldCampbell and Stan Hunterton have not yet filed motions in Federal Courtto force liquidation? Maybe they're waiting until June 30 to see ifJudge Pro or the city council orders sale of the Crazy Horse Too to a qualified buyer?
If the Judge so chooses, the Rizzolo's assets can be seized andimmediatelyliquidatedwhile he sits watching Springer during his twelve months and oneday stay at Taft.
But that'snot the only setback this week suffered by the firm of Patti & Sgro. Another motion to benefit their main client also looks like its about to backfire on the prestigious mob lawyers.
On Thursday, ClarkCounty District Court Judge Elizabeth Gonzaleztemporarily re-opened Buffalo Jim Barrier's harassment law suit againstRizzolo.
Judge Gonzalez heard arguments from Barrier's attorney Kim Price with the Flangas McMillan Law Group, and from a lawyer with Patti & Sgro.
I'm sorry I can't identify Rizzolo's attorney because he mumbledincoherently when the judge asked him to identify himself, however hewas a middleaged man with bushy gray hair wearing a wrinkled suit.
Attorney Price explained thatBarrier's civilharassment law suit should never have been dismissed based on thefive-year-rule because the Federal Government had placed at least threestays on the case that prevented discovery andstopped the taking of Rick Rizzolo's deposition on at least threeoccasions.
Rizzolo's disheveled attorney mumbledthat thestays were not official federal orders, and were not mentionedinBarrier's recent motionfor reconsideration.
He then mumbled, "The stay is notin this court's record," saying the dismissal should stand.
Despite his words, several otherlawyersfromPatti & Sgro previously used the stays tostallBarrier's case pending Rizzolo's trial for racketeering andtax evasion. They had also used the stays andclaims of Rizzolo'sill health to argue against their 48 year old client being deposed.
Judge Gonzalez asked attorneys forboth sides to calculate how many years the stays set the case back, andif it can be proven the stays were actually in place. She ended thehearing with the door open for the case to be reinstated.
Mr. Price has until May 23 to submit abrief stating the date the stay first went into effect, and when thestays were released. Patti & Sgro have until May 30 to answer Mr.Price's brief and argue why the stays should not affect thefive-year-rule that triggered the dismissal of Barrier's lawsuit.
If Judge Gonzalez allows the case tocontinue, another lawsuit will also be resurrected.Rizzolo suedBarrier for defamation in 2002 for his public statements that Rizzolowas engaged in racketeering. Since then, Rizzolo pleaded guilty toracketeering so this element of the lawsuit is expected to be summarilydismissed in the event the two casesproceed to trial.
The irony is that it was Rizzolo's attorney John Norheim of Patti & Sgro who first advised the court that there is a Federal Order estopping the case back on December 15, 2004 (see below).
(Excerpts from the Court Record)
12/15/2004: Mr. Norheim advised there is a Federal Order estopping and it is expected this will be in U.S. Court next year. Also, his client is very ill and in the hospital. Mr. Flangas confirmed that the Federal order has kept them from doing discovery. He requested a six month status check.
Then on March 20, 2006, the attorneys for Barrier and Rizzolobrought uptwo Federal holds andrequested the matter be continued.
(Excerpts from the Court Record)
03/20/06: Both counsel confirmed there were two Federal holds and requested the matter continued. COURT SO ORDERED, CONTINUED to 9/18/06.
Then once again, on November 13,2006, attorneys for Barrier and Rizzolo both told the court that stayswere preventing discovery.
(Excerpts from the Court Record)
11/13/2006: Re Status Check: Set New N-J Trial Date: COURT NOTED that nodiscovery has yet been done because of all the stays and Mr. Rizzolo's health. COURT INQUIRED about the five-year rule. Both counsel stated that the exact date is not known at this date because of the many past stays.
Whenit suited their needs last week, Rizzolo's attorney tried to convincethe courtthat stays were never a factor in this case and Barrier's attorneyssimply let the case expire. But when his law firmneeded to stall the case to keep their client from being askedembarrassing questions during a deposition,Patti & Sgroeffectively argued that stays weredefinitely in effect, and discovery is not permitted during stayedproceedings!
You can't have it both ways.
JudgeGonzalez has scheduled a hearing on May 31 to give her decision as towhether BARRIER v. RIZZOLO will be reinstated.
Since the case was dismissed on May 4,several acts of vandalism similar to the acts that inspired theoriginalharassment lawsuit have been reported. Vehicles owned by customers ofBarrier's Allstate Auto and Marine have been keyed or had their windowsbroken while waiting for repairs outside his shop.
But as soon as JudgeGonzalez indicated she may reopen the case, thevandalismsuddenly stopped.These actions further affirm that a vindictiveRick Rizzolo is still in charge of the Crazy Horse.
After Thursday's hearing, Barrier's attorneys showed renewed energy andsaid theylook forward to using Patti & Sgro's own words to prove their casewas stayed, and also look forward to deposing the elusive Rizzolo.
"This time he'll be easy toaccess," said attorney Gus Flangas, "He can't duck a deposition whenhe's sitting in prison."
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