Prive-Gate Continues in Las VegasAugust 6, 2009 By: Bryan Bass
The streets of Sin City are still abuzz as city officials continue their assault on Planet Hollywood hot-spot Prive Nightclub; meanwhile, other nightclub operators and resort landlords watch with baited breath to see what the fallout might be. On the heels of a $750,000 penalty from the state’s powerful Gaming Control Board, Clark County officials denied a permanent liquor license for the venue, ordering that it be closed when the temporary license expired on July 28.
The club, which has 30 days to appeal the decision but cannot remain open during that time, got back in front of department of business license director Jacqueline Holloway on July 28 to ask for a temporary license to continue operating while the decision is appealed. Holloway reviewed a summary of corrective actions that had been put in place but decided against issuing a temporary license, noting, “While I am encouraged by the proposed plan presented today, I am not satisfied that it goes far enough to address the myriad problems that were uncovered.”
Holloway continued by saying that the current management team “cannot be relied upon to address these violations,” and also denied the applications of directors Greg ‘J’ Jarmolowich and Frank Tucker as key employees for the venue. “I believe we need a corrective action plan that includes a new management team and comprehensive management oversight that addresses all of our concerns,” she explained.
It is rumored that Holloway was greeted at her office on the morning of July 28 with as many as 30 e-mails and at least two notarized affidavits from former employees who were hardly praising the practices of the Prive team — although whether this had any impact on Holloway’s decision is not known. Additionally, the whispers of other government agencies getting further involved continue to pick up velocity, as many in the LV nightlife industry expect some kind of intersection between the Gaming Control Board’s investigation and the Internal Revenue Service. Whether that includes the taxman’s ongoing investigation of PURE Management Group or another round of investigations remain unclear at this time.
On Aug. 4, the Clark County Commission agreed to delay the appeal of the liquor license revocation until Aug. 18. The appeal is being held because of new developments, including reorganization of management. Sources suggest the still-silent investment group behind the Prive project might develop a different plan to move forward, which may or may not include members of the Opium Group or the current management team. Sources indicate the investors are reviewing a few different strategies and are content to stay in the shadows as things play out.
It also has been confirmed that multiple interested parties — organizations both in and outside of Las Vegas — have stepped out of the woodwork and expressed interest in the Prive space, should it become available. That being said, the investment group, which includes former Mandalay Bay scion Billy Richardson Sr., seems dead-set against giving up the space, purportedly in part because they have not yet recouped their initial investment in the popular nightclub.
And speaking of Mandalay Bay, the property might be the next player to enter the fray, not for Control Board violations but because Jarmolowich and Tucker are rumored to be involved in multiple projects on the property. Since all sides are off-the-record, it is unknown if either are currently listed as key employees for those projects or how the latest ruling would affect those venues in development.
The Gaming Control Board has been somewhat quiet in the days since it levied the large penalty and fine against Planet Hollywood, although it officially announced investigations of as many as nine other properties that host nightclubs or adult-directed pools on property for violations similar to those aimed at Prive. So as the slot reels keep spinning, this story just keeps growing. Stay tuned, as there is certainly more to come.