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Topless club may get new life

The doors of the Crazy Horse Too have been shuttered for nearly five years, but the strip club with a checkered history may be on the verge of a comeback.

Las Vegas City Councilman Bob Coffin confirms that he plans to introduce an amended zoning ordinance next month that would pave the way for the property, which sits in his ward on Industrial Road near Sahara Avenue, to once again open as a topless club.

The Crazy Horse Too has been closed since September 2007, when the U.S. Marshals Service seized the club after former owner Rick Rizzolo was unable to sell it as part of a plea agreement with the government to end a decade-long racketeering investigation. Rizzolo, long suspected of having organized crime ties, wound up serving 10 months in prison on a tax conviction.

But the Marshals Service also struggled to find a buyer for the colorful club in a declining real estate market and eventually allowed its licenses to lapse, leaving it an eyesore in the shadow of the Strip.

The proposed amendment is the result of months of high-powered talks behind the scenes between city officials and the current owners of the property, Canico Capital Group, a Southern California investment firm that owns the property’s first deed of trust. The company bought the vacant club for $3 million in July at a court-ordered public auction.

Before it shut down, the Crazy Horse Too, known as a hangout for mobsters, politicians and celebrities, was worth as much as $35 million.

“It could rise from the ashes,” said Las Vegas attorney Michael Mushkin, who represents Canico Capital.

Coffin last week did not want to discuss details of the zoning amendment. But Mushkin said it would allow his client to either sell or lease the property to someone who could apply for the business, liquor and adult entertainment licenses needed to revive the strip club.

The amendment, among other things, addresses the loss of use of a property obtained by the government through forfeiture, as in the Crazy Horse Too’s case, Mushkin said.

In an effort to bolster support for the amendment, Canico Capital agreed to pay the city a $1.5 million fine still on the books from the days when Rizzolo operated the club, Mushkin said.

Coffin likes that idea, but he wants to see the money go to Kirk Henry, a Kansas City-area tourist paralyzed after a fight at the Crazy Horse Too in September 2001.

As part of his 2006 deal with the government, Rizzolo agreed to pay Henry $10 million. But since then, Rizzolo has ducked his responsibilities, only turning over $1 million from the club’s insurance.

“Right now, I’m introducing this ordinance with what I hope is not a faint hope of getting some money to Kirk Henry,” Coffin said.

The city attorney has told Coffin that legally the city may not be able to give Henry cash, but Coffin said he still is looking for a way to do it.

He said it would give the city a chance to make up for allowing the Crazy Horse Too to operate as a “renegade club” for years.

Last month, Senior U.S. District Judge Philip Pro concluded in a written decision that Rizzolo was hiding money from Henry. The judge ordered Rizzolo and the widow of his father to take steps immediately to pay Henry $1 million earned from the sale of a strip club in Philadelphia.

Pro sent Rizzolo back to prison last year for violating the terms of his supervised release.

Prosecutors contended that Rizzolo had concealed from probation officers the financial transactions involving the Philadelphia sale, which occurred one day before Rizzolo’s 2008 release from federal custody. Some of the trans­actions were done through offshore accounts.

Mushkin said he has been fielding inquiries about the Crazy Horse Too, but would not discuss them.

He acknowledged that the property would be worth much more than $3 million as a strip club, but he would not estimate how much.

“It would be worth a lot more than a warehouse, which is what it is now,” he said.

Both Mushkin and Coffin said they were expecting the proposed amendment to be introduced at the June 6 City Council meeting.

Contact Jeff German at jgerman@reviewjournal.com or 702-380-8135.

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