Tuesday, June 17, 2003
Copyright © Las Vegas Review-Journal

Sahara parent trying to evict NASCAR Cafe

The NASCAR Cafe is fighting the Sahara's efforts to evict the restaurant and roller-coaster operator from the hotel-casino. REVIEW-JOURNAL FILE PHOTO

The Sahara is moving to evict the NASCAR Cafe from its Strip-front property, but the roller-coaster operator is fighting back.

The 1,750-room hotel notified the roller coaster and restaurant operator, Dyer Ventures, on May 23 that it wants the property at 2535 Las Vegas Blvd. South vacated by Monday.

Gordon Gaming Corp., holding company for the 51-year-old Sahara, wrote Dyer on April 22 outlining nonmonetary defaults in the property's 25-year lease.

NASCAR Cafe said it offered to correct the alleged defaults in a "conciliatory reply." But its response was a letter saying the lease was being terminated and the cafe was being evicted, said Efrem Rosenfeld, a partner in Rosenfeld & Money, the law firm representing the NASCAR Cafe.

"Frankly, we've been operating in good faith. This is really all about money," he said.

In the Sahara's original April 22 letter, Gordon general counsel Matt McCaughey wrote that the NASCAR Cafe was not being operated "so as to maximize its gross sales." The letter cited dents in one of the race cars on display and other alleged defaults, which Rosenfeld said were false issues.

"It's a race car, for Pete's sake," he said. "What this case is really all about is the $40 million," or $2 million plus a year in revenue the Sahara could realize if it operated the amusement area on its own for the remaining 22 years of the lease.

In addition, "since the death of (Sahara owner) Bill Bennett earlier this year, the inconsistent management has turned inexplicably hostile," Rosenfeld argued in court documents.

The lease calls on the NASCAR Cafe to pay the Sahara hotel 50 percent of its gross revenues from the roller coaster, restaurant and related amusements.

In the three years since the 90,000-square-foot NASCAR Cafe opened, Dyer has paid the Sahara more than $6.6 million.

In 2000, the Sahara spent more than $6 million on an updated facade, the racing-themed NASCAR Cafe and amusements, and the roller coaster, called "Speed -- The Ride."

Gordon Gaming Chief Operating Officer Al Hummel and McCaughey declined to comment because of the pending litigation.

Rosenfeld argued there is not "material breach" of the lease agreement.

A hearing has been scheduled for Thursday before District Judge Sally Loehrer seeking a preliminary injunction to block the Sahara from evicting the NASCAR Cafe.