Knappster: Big money, big names at stake in Ivanpah airport suit

By George Knapp

A massive lawsuit, scheduled to go to trial in early March, could have Clark County taxpayers on the hook for millions of dollars. It involves some of Nevada's biggest names and potentially explosive allegations that have a certain ring of familiarity.

Clark County officials, in particular those who work for McCarran International Airport, have been accused of welching on a business deal to develop a new airport in the Ivanpah Valley near Primm. The people who've filed the lawsuit say the idea for the new airport was theirs from the very beginning, that they plowed a pile of money into studying the site, and that they had a signed agreement with McCarran folks to develop and operate the billion-dollar project. According to the lawsuit, McCarran boss Randy Walker gave them the brush-off almost immediately after Congress gave its approval to the Ivanpah project.

Of course, anyone can file a lawsuit about anything. What makes this legal fight so interesting are the names involved. The folks making the accusations are no fly-by-night fast-buck artists. They are some of the best known and most respected people in the state. The law firm that filed the suit is Harrison, Kemp and Jones, one of the best known in Las Vegas. One of the key witnesses will be attorney Joe Brown, a partner in Jones-Vargas, the state's largest law firm. Brown, who is also a member of the Republican National Committee, is expected to testify that the Ivanpah litigants were ripped off by the county. Another of the expected witnesses for the plaintiffs is attorney John Laxalt. Perhaps you recognize the last name. Bob Campbell, former city manager of Henderson, joined the Ivanpah project late but is now up to his neck in it and is a potential witness. Ray Young, a former federal transportation consultant, was the driving force behind the airport idea through his company, Hamilton Development Group (HDG). At one point, other potential partners in the proposed venture included the late Bob Broadbent, who formerly ran McCarran and who launched the Las Vegas Monorail, Tony Marnell of Marnell-Corrao Construction, Marvin Suomi, president of Kajima USA, and other assorted heavyweights from the business and legal communities.

Some of the folks who've already been deposed as potential witnesses are also pretty interesting. County Commissioner Bruce Woodbury might be asked to testify about how the Ivanpah deal unfolded. He's already provided a deposition. Ditto for Dr. Troy Wade of the Nevada Alliance for Defense, Energy and Business, and Somer Hollingsworth of the Nevada Development Authority. Both have provided depositions indicating that the Ivanpah idea came from the plaintiffs. I've seen letters writted by Wade in which he describes helping the plaintiffs to scour the desert in search of a perfect location for a new airport, long before the county was brought into the fold. That could be powerful testimony in a jury trial.

I've been assured by several county sources that there is nothing to worry about, that the lawsuit is going nowhere, and that the county expects to win in a slam dunk. The county's primary defense is that the only agreement it had with the Hamilton Development Group was a memo of understanding to work together. The county is confident that a memo of understanding is not a binding contract and therefore the taxpayers are not on the hook for any damages. They also point out that of the six original contentions in the lawsuit, five have already been tossed out by a judge.

That's all fine, but the plaintiffs say it's the other allegation that is the juiciest. It alleges "unfair enrichment" on the part of the county, meaning the county stole the idea. In support of the argument, the plaintiffs have accumulated some interesting statements. For example, there is a letter, dated July 1997 and signed by Randy Walker, that spells out the Department of Aviation "intends to work with...HDG in planning for the acquisition of land and the potential development of an air carrier in the Ivanpah Valley." There is also a newspaper article from March 2000 in which McCarran's planning manager, Dennis Mewshaw, acknowledges that McCarran "begged, borrowed and stole" HDG's plans and that the county was "amenable to carefully structured joint ventures that would serve the public." And the memo of understanding itself, ratified by the County Commission, sure seems like it spells out a deal between the county and HDG to develop the airport. If it wasn't a contract, what was it?

The real question is why the county bailed on the agreement. Sources say HDG simply didn't have the financial resources to get the job done. However, HDG insiders say the airport never allowed the group to make its case. HDG brought in the giant Kajima Corp. and had a meeting set up during which it planned to make the case that it could do the job, but the meeting was abruptly canceled by Randy Walker.

The unspoken question is, if HDG was cut out of the deal, who was going to be brought in? The airport points out that no contracts--okay, ALMOST no contracts--have been issued for work on Ivanpah. But you have to wonder whether any wink-and-nod, secret handshake deals have been made. You can certainly be sure that a scramble is under way for land out in that valley. Real estate in the vicinity of an international airport would be worth a nice chunk of change. We will not only be watching to see who eventually gets the lucrative contracts to build and operate the Ivanpah airport, but also what names surface as land owners out there. Wonder if some of the names will be the same ones that may eventually surface in the ongoing investigation of land deals near McCarran.

Names and faces

A trusted source tells Knappster that last week's column may have given County Commissioner Rory Reid too much credit for brokering the amazing Nevada Power-Colorado River Comission-Southern Nevada Water Authority lovefest. The way I now hear it, Rory's pop is the guy who quietly got the ball rolling. Sen. Harry Reid reportedly made a call or two to the principals, did some friendly arm-twisting, then called on his son to ride herd on the testy participants. It certainly seemed to have been a winning combination. We will wait and see how long the truce lasts. ... Say, is it possible that prominent Las Vegas defense lawyer Jerome DePalma is the same Jerry DePalma who was the son-in-law of late Chicago mob boss Sam Giancana? Former Chicago cop and crime buster John Flood says the two are one and the same, that lawyer Jerry DePalma married Francine Giancana and that the two were the last to see Sam Giancana alive, other than the unknown Mafia killers who carried out a hit on their former boss. ... Got another note or two from Mistress Lee. Apparently, our item last week about actor Corey Feldman and his alleged visit to a Las Vegas swinger's club caught her attention. Mistress Lee says she's been flooded with e-mails from supporters of Michael Jackson who hope that stories about Feldman will be brought up if the actor ever takes the stand in Jackson's child molestation trial. ... Las Vegan Nick Tortarolo, who's been writing an online column about Las Vegas media, may land himself a more permanent gig. The word is that Tortarolo is talking to another weekly newspaper about taking his comments into the print medium. ... So what did Terry Lanni do on the day that federal authorities gave the okay to MGM Mirage's buyout of Mandalay Resort Group? Lanni was all smiles as he had lunch at Cili's with golf course magnate and gambler Billy Walters. Also joining that conversation was Hawaiian businessman Jimmy Gomes. Wonder what those three guys were talking about? ... The Atomic Testing Museum has opened to rave reviews, and it truly is a world-class museum. In honor of the opening, here's a question that needs to be answered: Where is Miss Atomic? The museum would love to locate the local showgirl who posed long ago for the famous Miss Atomic promotional photo. Her real name was Lee Merlin, but no one has been able to find her. Readers, any thoughts? ... A final note--my dad is no longer around to ask, but I know exactly where he was 60 years ago this week. He was driving a landing barge full of Marines during the bloodiest days of the U.S. assault on Iwo Jima. Wish I could hear those stories again.