May 12, 2014, UPDATE: The case against Peter DeMangus has been settled.
Jerry’s Nugget and an executive at the company’s North Las Vegas casino are being sued over a defaulted loan involving land in Mesquite.
2010-1 CRE Venture LLC, which holds some of the loans from the failed Community Bank of Nevada, filed suit Wednesday in Clark County District Court against Jerry’s Nugget, a Nevada corporation.
Also sued were Jerry’s Nugget’s licensed general manager and investor Peter DeMangus, the Peter G. DeMangus Gaming Properties Trust and Michael Kennedy.
The lawsuit said Community Bank in 2007 loaned $40.3 million to Barcelona Partners LLC, an entity managed by DeMangus and Kennedy.
Barcelona Partners LLC before the recession proposed to develop a resort community with a hotel and casino in Mesquite called Solstice. All that was fully developed was a motorcoach park, the Mesquite Local News reported.
Wednesday’s lawsuit says the loan was guaranteed by Jerry’s Nugget and personally by DeMangus and Kennedy.
The lawsuit says Barcelona failed to pay the balance due on Nov. 24 and that the guarantors are liable for payment of the principal of $33 million plus interest and costs.
“Guarantors have breached their obligations to plaintiff by failing to pay the remaining amount due,” the lawsuit alleges.
DeMangus said Thursday he was unaware of the lawsuit and couldn’t comment.
Lawsuit records show the loan at issue initially involved 178 acres. After several transactions involving the land, the parcel named in the trust deed now consists of 20.31 acres.
That land has been subject to at least two foreclosure notices, but as of Thursday Barcelona Partners was still listed as the owner.