Developer, casino owner Black and wife seek bankruptcy protection

Longtime real estate developer and casino operator Robert R. "Randy" Black Sr. and his wife, Katherine, filed for Chapter 7 bankruptcy protection on Wednesday in the midst of a Bank of America lawsuit to collect millions of dollars from them.

The Blacks gave a personal guarantee in 2005 to cover the difference between the amount owed on an office building, constructed by Randy Black on the western edge of Summerlin, and its value now that the loan has matured. In federal court papers filed in February, the bank set the loan total at $14.6 million, not including ongoing interest and fees, and estimated the building was worth less than $11 million.

The bankruptcy petition did not include detailed financial information. It merely set the Blacks' liabilities at $10 million to $50 million against less than $50,000 in assets. Under Chapter 7, the so-called fresh start part of the U.S. Bankruptcy Code, a debtor is allowed to wipe away all debts and keep possessions allowed by certain exemptions. Everything else can be claimed by a trustee and sold to repay creditors.

The bankruptcy clerk's office accepts new cases around the clock and on holidays, allowing the Blacks' attorneys to move on the Fourth of July.

Black & LoBello, the law firm representing the Blacks, did not return calls seeking comment.

Bank of America brought its collection action in U.S. District Court. On July 3, Magistrate Judge George Foley Jr. allowed the bank to subpoena lease information from three tenants at the building, located at 10777 W. Twain Ave., including Black & LoBello. However, he deferred ruling on the Blacks' request to combine the action with a parallel one filed in Clark County District Court.

One element of the state court case is on appeal to the Nevada Supreme Court. Bank of America has sought clearance to foreclose on the building.

The bank funded a $12.2 million construction loan in 2005 that was used to build the 70,000-square-foot office. After several changes and extensions, it came due in September.

As a side effect of the Las Vegas real estate implosion, several developers have faced collection actions on personal guarantees, often considered afterthoughts when the local economy was booming and prices soaring. In addition, Randy Black's 99 percent ownership of Black Gaming LLC was slashed to 10 percent two years ago as part of a Chapter 11 bankruptcy reorganization of that company's crushing debt. The company owned three resorts in Mesquite that suffered from the recession.

While applying for a gaming license in July 2011 for Mesquite Gaming LLC, the successor to Black Gaming, Randy Black told the Nevada Gaming Commission that he hoped to buy out the other owners and regain full control of the company.

Contact reporter Tim O'Reiley at toreiley@reviewjournal.com or 702-387-5290.