Blocked club door sparks lawsuit, accusations of racism

The most direct route from the opulent Caesars Palace casino to the upscale Poetry nightclub above Wolfgang Puck's Chinois restaurant is to walk through Forum Shops, perhaps the fanciest and best-known mall in Las Vegas.

But customers who dress up and head to Poetry during prime party hours don't get to stroll across that glamorous real estate.

Instead they are directed outdoors, past some trash bins and into a desolate, windowless hallway marked by litter and rat traps until they emerge back at the Forum Shops near the Poetry entrance.

That doesn't sit well with Poetry managing partner Mike Goodwin.

He says the circuitous route imposed on his customers is a deliberate attempt by Caesars and mall owners Simon Property Group Inc. to drive Poetry out of business because they don't like that the club plays hip-hop music and attracts a largely black clientele.

"There is a belief in Corporate America that too many black people on your property harms business," says Goodwin, who is white."It seems to be the way they are acting."

Later this month, a federal judge is scheduled to decide if Goodwin's allegations have merit.

Goodwin, along with partners in Puck's restaurant, sued Caesars and Forum Shops, demanding an end to the practice of blocking the main entrance to the mall at night so Poetry customers can enter through the front door.

"I think it is despicable," said Tom Kaplan, senior managing partner of the Wolfgang Puck Fine Dining Group. "To block (access) and make people walk around into a corridor is inappropriate and unfitting of the facility."

Lawyers and officials for Simon Property Group and Caesars' parent company Harrah's Entertainment wouldn't consent to an interview.

But in court documents asking a judge to dismiss the case, attorney Samuel Lionel blasts the plaintiffs for "playing a race card they do not hold," in an attempt to gain an upper hand in a business dispute.

Lionel writes the racial allegations, "are absolutely false and undescribably (sic) offensive."

He says Chinois is violating terms of its lease by allowing the nightclub to operate on its premises and accuses Poetry customers of, "public drunkenness, shouting of obscenities, urination and vomiting in public areas, fighting, vandalism to property of other tenants in the Forum Shops and assault and battery of customers and security personnel."

The dispute dates back several years. Since becoming a court case in Nevada in January it has generated hundreds of pages of legal documents in addition to the bad blood.

It taps into a long-simmering debate in Las Vegas that crops up whenever black people get caught up in a prominent incident of violence or trouble on the Strip, especially if the problem can be traced to a club, event or business that attracts a black clientele.

The debate, which often devolves into name-calling or recitation of racial stereotypes, typically plays out on Internet message boards or letters to the editor during the aftermath of the latest incident.

It usually boils down to an argument about whether black-oriented events and clubs attract a hip-hop element who dissuade mainstream visitors from returning to Las Vegas or that the city's reputation as the "Mississippi of the West" is alive and well and prompting potential black visitors to spend their time, and their money, someplace else.

"There is also a historically justified hypersensitivity on the part of Afro-Americans for the radar to go up at all seeming affronts," said Rainier Spencer, director of Afro-American Studies at University of Nevada, Las Vegas.

Spencer says he doesn't know enough about the Poetry situation to judge whether club owners' allegations of racism are legitimate.

"The thing to do at such times is take a deep breath and determine whether real racism or something else is going on," Spencer said. "Sometimes it is; sometimes not."

Clark County Commissioner Lawrence Weekly said he encountered the situation at Poetry a few weeks ago while entertaining out-of-town guests.

The group, which he said included a doctor, lawyer and two professional athletes, dressed in evening wear and headed to Caesars Palace and the Forum Shops.

Weekly said he was surprised to find the Forum Shops entrance blocked and the only way to the club was out a side door from the casino and through the hallways.

"Before you knew it we were walking through an alley," Weekly said. "I thought it was pretty awkward."

Weekly, who is black, said whether the situation is racially motivated or not, it is giving customers a bad impression of Caesars Palace and Forum Shops.

"I've heard people share that it has a serious racial overtone," Weekly said. "I hope they will work it out. Caesars is a beautiful place ... especially to take guests."

Goodwin and Kaplan both say they are unhappy about racial overtones of their dispute with the mall. But they are also adamant about their position and say the evidence backs it up.

According to Goodwin and court documents, the relationship between Forum Shops, Caesars and the nightclub started smoothly when he opened for business above Chinois in 2003.

At the time the club was called OPM, but it was essentially the same in terms of music and clientele as it is today under the Poetry name.

The business arrangement, which Goodwin and Kaplan say was approved by Simon and Caesars, was a deal that allowed Goodwin and his partners to use space above Chinois at night.

Chinois, which has been at the location since 1997, was enjoying success in part because its long-held lease meant the restaurant was paying less for space than other, less-established businesses in the mall.

The lower cost structure also helped Goodwin's group because it provided an opportunity to launch a small, specialty nightclub in a prime location on the Strip.

"We were open about 15 months before anything was an issue," Goodwin says. "Everything was lovey-dovey."

During the good times, Goodwin said Simon and Caesars helped the club by allowing it to advertise itself in good location on the property and honoring the understanding that the public space in Forum Shops would be easily accessible at all hours.

The relationship changed in late 2004, according to court documents.

The court documents state that on Dec. 24 several black men got into an altercation in Caesars Palace. After the incident, Caesars sent a video of the incident to the club, implying there was a connection, the documents state.

However, that evening Poetry -- then OPM -- was hosting a mixer for Jewish singles, "and not one African-American person attended this event," according to court records.

A week later on Dec. 31, Pure nightclub opened at Caesars. The club, with about 40,000 square feet of space, attracts as many as 7,000 to 10,000 customers in an evening, according to the documents.

Owners of Chinois and Poetry say the new, much larger, club coincided with a spike in problems such as fights, public drunkenness and loitering.

According to allegations in the court papers, OPM was being blamed whenever late-night problems at Caesars or the Forum Shops involved black people.

Kaplan says Caesars and Simon kept up the scrutiny on OPM even though Goodwin's group increased spending to hire private security and Las Vegas police officers and lack of evidence the club generated an undue amount of problems.

"Whenever there has been an issue he has corrected it immediately," Kaplan said of Goodwin. "They are rock-solid in our opinion."

The tension between the sides intensified further in early 2006, the records suggest.

In addition to allegations from OPM and Chinois that Caesars and Simon targeted the businesses with formal notices alleging tenant violations, Simon sent a letter that stated Chinois was violating its lease by allowing the club to operate and both businesses could be kicked out of the mall.

After a flurry of correspondence the dispute died down, the records state.

It picked up again in 2007 after the National Basketball Association All-Star Game was held in Las Vegas.

On Feb. 27, 2007, Simon sent a letter to Chinois alleging OPM generated crowds that caused congestion in the mall to the point of violating fire safety regulations.

Goodwin says the Forum Shops were crowded throughout the weekend of the All-Star Game and the congestion had nothing to do with the club. He says the club hired extra security officers, something operators of Pure and Atlantis, another attraction in the mall, failed to do.

Again, the flap subsided for a while. It reignited in August 2007 after a highly publicized shooting at Caesars.

According to news reports, a fight started in the casino involving two black men and a woman.

The altercation ended with one of the men shooting the other man in front of a bank of elevators.

After the incident, security officers began barricading the main entrance to Forum Shops nightly at 1 a.m., blocking the best access to OPM even though video of the shooting shows the people involved wore clothes that didn't meet the club's dress code, suggesting they couldn't have been customers there.

"Our numbers dropped after that door closed," says Goodwin, whose club is the only business in the mall that operates after 1 a.m.

The dispute became a court case in October 2007 when Caesars and Simon sued Chinois alleging the restaurant was subleasing space to the club in violation of its lease agreement.

That lawsuit was filed in Delaware, where both Simon and Chinois maintain corporate charters.

Chinois and OPM, now Poetry, countered with a lawsuit in Nevada that was shifted to federal court because of the racial allegations.

Simon and Caesars are asking a judge to dismiss the case. A hearing is scheduled for Oct. 30.

"We have a policy of not commenting on pending litigation, however the implication that our casino discriminates is preposterous," a spokeswoman for Caesars said in an e-mail.

"Our diversity and inclusion strategy spans our entire business and we welcome guests and employees from all backgrounds at our property."

Goodwin says he's already turned down a $25,000 offer to move out because the money wouldn't even come close to covering the cost to close down, let alone the cost of moving and establishing the business someplace else.

He wouldn't say what he would consider a reasonable offer to relocate. But he referenced reports that Las Vegas Sands Corp. paid rap entrepreneur Jay-Z about $44 million for a stake the 40/40 Club in August, about two months before the Sands bought out the remainder of the club's lease at Palazzo.

He also notes there are four years and eight months remaining on his lease at Forum Shops.

"If they would like us out before that, why don't they make a reasonable offer," Goodwin said.

Contact reporter Benjamin Spillman at bspillman@reviewjournal.com or 702-477-3861.