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No quick decision in Wayne Newton museum lawsuit

The fate of a troubled plan to convert Wayne Newton’s Casa de Shenandoah estate into "Graceland West" to honor the long time Strip entertainer won’t be known until January, at the soonest.

At a Tuesday morning hearing, Clark County District Judge Elizabeth Gonzalez rejected a bid to dissolve CSD LLC, which owns the property and has been transforming it into a tourist attraction based on Newton’s life and career. Instead, she will allow attorneys for Newton and his wife, Kathleen , to interview a potential list of several dozen witnesses and to complete a forensic audit of the company’s spending, estimated to total $60 million in the past two years.

This evidence would set the foundation for a Jan. 7 hearing on whether to bring down the curtain on CSD, which sued the Newtons in May.

Gonzalez said "serious issues" surrounded the conduct of CSD, but did not specify which ones came to her attention. The Newtons, as 20 percent owners, have traded a lengthy list of charges with 70 percent owners Lacy and Dorothy Harber, the Texas investors who have written the checks for the work, and ally Steve Kennedy, the project manager who holds 10 percent, including fraud, sexual harassment, obstructing progress to the point of sabotage and even death threats.

"The evidence now before this court is overwhelming that it is not reasonably practical to carry out the business of this limited liability company," said CSD attorney Charles McCrea. "The situation has gone well beyond both sides claiming that the other is simply uncooperative."

The shutdown package would include paying the Newtons $1.5 million, what CSD calculates as the remaining balance of a $2 million fund to build or buy them a new home, letting them remain in their Casa de Shenandoah mansion for a year, returning his memorabilia from a 50-year career as a Strip entertainer and his antique cars.

NEWTONS TO PAY FOR AUDIT

The Newtons’ attorney, J. Stephen Peek, repeated past testimony by Kathleen Newton that she and Wayne want to finish the project as intended. However, the Newtons will pay for the forensic audit to try to answer large questions they have raised about where the CSD money has gone.

Out of the $60 million, $19.5 million went to purchase in June 2010 the 42-acre walled compound and mansion at the southwest corner of East Sunset and South Pecos roads. But much of the theme park plan – including construction of a visitors center with a small theater, a Wayne Newton museum and renovation of the mansion for tourists – has not been carried out.

ADDED COSTS CLAIMED

However, the Harbers and Kennedy say that they have conducted extensive and badly needed cleanup work at the ranch and have spent heavily on landscaping and other improvements such as drainage. CSD noted in the past that the Harbers paid off liens on Newton’s personal jet, then had it shipped to the ranch from Michigan.

CSD said that a recent audit commissioned by the Harbers and Kennedy was an accounting of all the money.

In the meantime, Harber will remain under a court order first imposed in June to pay for the upkeep of the 51 Arabian horses the Newtons keep at the ranch at a cost of about $37,000 a month. The Harbers and Kennedy wanted to keep 20 horses for equestrian shows and move the rest of the herd elsewhere.

Contact reporter Tim O’Reiley at toreiley@review journal.com or 702-387-5290.

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