Phoenix, Denver And Las Vegas - Corporate Counsel The Las Vegas Legal Community - Like The City Of Las Vegas Itself - Growing By Leaps And Bounds

Friday, April 1, 2005 - 00:00

The Editor interviewsEd Mulholland,Associate Corporate Counsel, Tropicana Resort and Casino, andLou Dorn,Vice President and General Counsel, Colony Resorts Acquisitions LLC.

Editor: Las Vegas is enjoying booming growth. Are you newcomers to Las Vegas yourselves?

Mulholland: Originally from Iowa, I went to Creighton University for undergrad and the University of Nebraska for law school. Several friends in law school received summer associate positions with the firm of Lionel Sawyer & Collins, so I sent resumes to firms in Las Vegas as well. I lucked into a fantastic job with the firm now called Schreck, Brignone. My good fortune continued when I joined Tropicana in 2000.

Dorn: A Nevada native, I went to law school at Lewis and Clark in Oregon. Coming back to Nevada after law school, I found my way into the gaming industry after serving as a law clerk for a judge and ultimately worked as the Chief of the Corporate Securities Division of the Nevada Gaming Control Board. I then went into private practice, specializing in gaming and transactional work before joining Colony Resorts about one year ago.

Editor: Why is Las Vegas an attractive place to do business?

Dorn: With neither a corporate nor a personal income tax, the tax climate is highly favorable.

Mulholland: Because people are moving into Las Vegas like crazy, there is a lot of labor available.And, of course, if you're in the gaming industry, Las Vegas is the place to be.

Editor:How is your company organized?

Mulholland: Our parent is Aztar Corporation, a publicly traded entity, headquartered in Phoenix. Tropicana Resort and Casino operates as a wholly owned subsidiary of Aztar. Our operating entity is Hotel Ramada of Nevada, which is a Nevada corporation.

Dorn: We are a limited liability company with a fairly complex organization structure. Two of our membership entities own voting units, and two own nonvoting units. This structure allows private equity to be invested in a gaming company without requiring non-voting investors to be licensed.

Editor:Does the Sarbanes-Oxley Act apply to Colony Resorts since you are a reporting company in all material respects in the eyes of the SEC but you do not have publicly traded stock or debt?

Dorn: Sarbanes-Oxley applies in many respects. For example, we are required to comply with Section 404 and we are currently in the process of documenting all of our internal controls.This is a tremendous effort that will be very expensive and will require significant involvement from every level of our management.I'm on the steering committee to ensure that any legal issues that arise are properly addressed.

Editor: Please tell our readers about the Las Vegas legal community.

Mulholland: It is a small, tight-knit group of congenial lawyers. Just like the city of Las Vegas itself, the legal community is growing rapidly. We are seeing larger firms coming here including regional firms like Snell & Wilmer and Lewis Roca LLP from Phoenix and national firms like Littler Mendelson.

Editor: How is your legal department structured?

Mulholland: Aztar does not have a general counsel at its corporate office. In our resort operations division, my boss Nick Moles is stationed at Tropicana in Atlantic City. Another associate counsel works in Atlantic City with Nick.

As well as the legal functions you'd expect, security and risk management functions report to me. It's a busy department with a third-party administrator handling workers' compensation claims and a two-person staff handling personal injury cases.

Dorn: I handle all legal issues with the assistance of outside counsel when appropriate. Risk management reports to me. One of the staff handles all workers' compensation claims and the other handles all guest liability claims. We have a third-party administrator for workers' compensation claims as well.

Editor: What types of issues do you address in your day-to-day practice?

Mulholland: Among the myriad legal issues, every contract and every agreement goes across my desk before the company signs it. Because Tropicana has collective bargaining agreements with seven different unions, employment and labor issues seem to take up a lot of my time.

Dorn: The issues I handle are much like those handled by Ed. Contract review and claims management typically takes up at least half my day. Fortunately, I do not have any litigation pending right now.I also sit on our Administrative Committee for our 401(k) Plan and am directly involved with any issues concerning gaming and regulatory compliance, intellectual property, litigation and employment matters.Our outside counsel typically handles our labor issues.

Editor: What technology tools help you in your practice?

Dorn: When I have a relatively small, yet novel legal issue, I'll do a quick LexisNexis search from my desktop so that I can be comfortable in the legal advice I give.The Internet is extremely useful in many respects.For example, I was recently able to get a quick answer on an ADA question through an Internet search.

Mulholland: I use WestLaw for the same purposes as Lou uses LexisNexis. The Internet from time to time can be a very helpful tool to track down information. For example, on the relatively few occasions when I've had to address immigration issues, I've found the immigration websites helpful.

We use a program here called STARS, which is a risk management program that enables us to track the status of our workers' compensation claims, reserves and those sorts of things.

I also visit the website of the Association of Corporate Counsel (ACC) at www.acca.com, which has a wealth of forms, checklists and other resources to help in-house counsel.

Editor: What contributes to successful relationships between in-house counsel and their law firms?

Mulholland: Communication is the key. When I assign a matter to outside counsel, I expect to be informed about the status of a case and where it's headed, not only for oversight purposes, but also so that I can inform ourexcess liability insurance carriers as appropriate.

In addition, I like the firms that have served the casino industry for a number of years because they have a sense for how the business works.

Jerry Glassman of Grotta, Glassman & Hoffman, P.C. has served as the labor counsel for Tropicana in Atlantic City for quite some time, and he's done a very nice job handling many matters for us here in Las Vegas.

Dorn: It helps to flip the question by asking what contributes to an unsuccessful relationship. Two things cause me to terminate a relationship. One is poor billing practice. For example, if I talk with outside counsel for 15 minutes and do not ask for additional work, I expect a bill for 15 minutes. I find it rude if the firm sends a bill a month later for a couple hours of follow-up work. The other is being unresponsive. I do not have time to be calling the firm with reminders. If I have a time sensitive matter, I expect the law firm to be proactive in keeping me up to date.

Adam Turtletaub is an example of a very good lawyer. He's with Willkie Farr out of New York and helps address our SEC and other corporate matters.

Editor: What professional associations do you find helpful?

Mulholland: As well as the helpful website I previously mentioned, ACC sends its members a useful hardcopy periodical.Our state bar and Clark County bar offer us seminars to meet Nevada's CLE requirements.

Dorn: I always attend the annual meeting of the International Association of Gaming Attorneys where in-house counsel and their law firm counterparts and gaming executives establish relationships that can be helpful later down the road when confronting common issues. I'm also a member of the Executive Committee of the Gaming Law Section of the State Bar of Nevada.

Editor: How do the state and federal courts in Nevada keep their dockets moving?

Mulholland: Nevada has one of the busiest court dockets in the country, both at the state and federal level. The wonderful people who serve as judges here are dedicated to eliminating any backlog of cases. Over the years, they've done a number of things to keep their dockets moving. At the state level, they implemented a mandatory arbitration program for matters that fall below a certain dollar value. They also have a short trial program to try to expedite some of the more minor matters. As our region has grown, the judiciary has been adding judges to help ensure that all parties have timely access to their day in court.

Editor: Do your legal departments prefer mediation and arbitration to litigation?

Mulholland: The court mandatory arbitration is perfect for the types of personal injury claims we get here because the vast majority of them are of a smaller nature. In a commercial setting, I've used mediation more often than arbitration as a nonbinding mechanism for reaching prompt resolution. If a dispute is of a substantial nature, I typically prefer litigation to arbitration. The attorney's fees in Las Vegas are not cheap. They are not much less than those in Los Angeles or Dallas. Because they can add up quickly, it is generally in the best interest of all parties to resolve their disputes as quickly as possible.

Dorn: Like Ed, I think mediation is the best way to go. Most disputes can be resolved before any action is filed if you get the interested parties together as early as possible.Our financial exposure for any claim, regardless of its size, grows significantly once litigation ensues, and pretty soon the attorney's fees for both sides become a predominant component.Thus, my goal is to get all disputes resolved before the cost begins to grow unnecessarily.

Please email the interviewee at louis.conti@hklaw.com with questions about this interview.