Federal
Court Cripples Rizzolo
Freezes fraudulently transferred
U.S. and off shore assets
"The Court concludes
Plaintiffs have established
that they are likely
to succeed on the merits,
the balance of equities
tips in their favor."
Senior U.S. Judge
Philip M. Pro - October 10, 2012
INSIDE VEGAS by Steve Miller
AmericanMafia.com
October 15, 2012
LAS VEGAS - For the first time in the eleven-year-long
HENRY v. RIZZOLO case, United States Senior Judge Philip M. Pro stated
that he believes beating victim Kirk Henry will prevail at his upcoming
Uniform Fraudulent Transfers Act (UFTA) jury trail scheduled to begin on
March 26, 2013.
During last Wednesday's hearing in the
Lloyd D. George U.S. Courthouse to determine whether convicted
racketeer Rick Rizzolo's ex-wife Lisa Rizzolo and his step mother Kimtran
Rizzolo should be prohibited from withdrawing further funds from off shore
accounts and annuities, Judge Pro referred to case law created in 1998
by U.S. Judge Lloyd George that will allow Lisa to be jailed
if she attempts to prevent transfer of her Cook Islands money to beating
victim Kirk Henry in the likely event Henry prevails on March 26, 2013.
Stan Hunterton, one of Henry's attorneys,
told Judge Pro that he was concerned that if his client won the UFTA case,
the Rizzolos would refuse to repatriate their off shore stash to make good
on Rick's agreement to pay Kirk 
Henry
(LV Review-Journal photo) $10 million in restitution for the crippling
injuries Henry suffered in 2001 at the hands of one of the Rizzolo's Crazy
Horse Too topless bar managers after Henry disputed a padded bar tab.
In response to Hunterton's concerns, Judge
Pro cited case law established by Federal Judge Lloyd D. George, the namesake
of the Las Vegas Federal Courthouse.
According to a June 19, 1998 Federal Trade
Commission PRESS RELEASE entitled Couple
Jailed for Failing to Repatriate Almost $1.3 Million in Offshore Account;
"Judge Lloyd D. George, of the U.S. District Court for the District of
Nevada, on June 17, 1998, found San Diego defendants Denyse Anderson and
Michael Anderson in contempt of court for failing to repatriate almost
$1.3 million in assets located in an offshore trust. As a result of the
contempt order, the Andersons will be jailed until the money is recovered."
The Anderson's money was stashed in the
same Cook
Islands bank as the Rizzolos.
In a written opinion issued on May 22,
1998, Judge George ruled that "there is a substantial likelihood that the
(Plaintiff) will succeed on the merits in its litigation..." He then "froze
the assets in the possession or control of the defendants."
Judge George's colleague Judge Pro said
the same on October 10, 2012 about the Henry's case; "The Court concludes
Plaintiffs have established that they are likely to succeed on the merits..."
He then froze the Cook Islands assets of the Rizzolos.
Lisa and Kimtran Rizzolo should be concerned
following Judge Pro's Wednesday ORDERs. The first of two ORDERs stops Lisa
from continuing to draw funds from the Cook Islands to provide support
for her freeloading adult children and extended family members:
Several minutes after publishing his first
ORDER, Judge Pro published a second ORDER freezing Kimtran's U.S. accounts:
Full docket text for
document 656:
MINUTES OF PROCEEDINGS
- Motion Hearing held on 10/10/2012 before Judge Philip M. Pro. Crtrm Administrator:
D. Sherwood; Pla Counsel: C. Stanley Hunterton, Philip R. Erwin; Def Counsel:
Mark B. Bailus, Herbert Sachs, George P. Kelesis; Also Present - Brett
I. Johnson for Garnishee Defendant Transamerica Life Insurance Company;
Court Reporter/FTR #: Henry Enriquez; Time of Hearing: 10:30 a.m.; Courtroom:
7C; The Court, having heard the arguments of counsel, finds as follows:
Plaintiffs' Motion [603] for Order to Hold Defendant Kimtran Rizzolo in
Civil Contempt for Failure to Comply With Order (#583) and Judgment (#584)
is DENIED. IT IS FURTHER ORDERED Defendant Kimtran
Rizzolo shall not attempt to withdraw, or withdraw, funds from her accounts
at Transamerica Life Insurance Company, Metlife and Citi National Bank.
Counsel shall submit a Proposed Order for the Court's signature containing
the account numbers for these accounts. Plaintiffs' Motion [641] for Order
to Show Cause Why Garnishee Defendant Transamerica Life Insurance Company
Should not Be Held in Contempt for Failure to Comply With Order (Dkt. No.
634) is DENIED. The Court finds Plaintiffs' Renewed Motion for Injunctive
Relief Against the Dissipation or Transfer of Assets [635] stands submitted.
Court grants counsel's request to file Proposed Joint Pretrial Order on
10/11/2012. (Copies have been distributed pursuant to the NEF - DMS) |
The ORDER freezing Kimtran's accounts was
in response to an earlier ORDER issued on April 19, 2012:
IT IS FURTHER ORDERED
that Judgment is hereby entered in favor of Plaintiffs Kirk Henry and Amy
Henry and against Defendants Rick Rizzolo and Kimtran Rizzolo. The
transfers to Bart and Kimtran Rizzolo in the total amount of $1,052,996.03
were fraudulent pursuant to Nevada Revised Statutes § 112.180(1)(a)
and therefore should be avoided. Defendants Rick Rizzolo and Kimtran Rizzolo
shall make the necessary arrangements to transfer funds in the amount of
$1,052,996.03 to Plaintiffs Kirk Henry and Amy Henry within thirty (30)
days. Any such funds transferred to Plaintiffs Kirk Henry and
Amy Henry shall be credited toward the Judgment entered against Rick Rizzolo
and The Power Company in Kirk and Amy Henry v. The Power Company, Inc.,
et al., Case No.A440740 in Nevada state court.
DATED: April 19, 2012
PHILIP M. PRO
United States District
Judge
http://www.stevemiller4lasvegas.com/RizzoloKimtranOrderedToPayHenry-04-19-12.pdf |
Immediately following the April 19, ORDER,
Kimtran's attorney Herb Sachs filed an APPEAL with the Ninth Circuit Court
in San Francisco to try to have the $1,052,996.03 overturned. This
inspired two Las Vegas Review-Journal columns by John L. Smith::
http://www.lvrj.com/news/lawyer-wants-prosecutors-to-follow-money-not-rizzolo-name-172793441.html
http://www.lvrj.com/blogs/smith/Sachs_More_to_Rizzolo_case_than_meets_the_eye.html?ref=011
and several Steve Miller INSIDE VEGAS
E-Briefs critical of Kimtran.
Mr. Sachs responded with the following
letter addressed to John L. Smith, and copied to me. The letter reveals
the strategy Sachs plans to use with the Ninth Circuit Court:
Having carefully reviewed both Lisa's and
Kimtran's Appeals, I must admit that the Appeal filed by Herb Sachs is
the superior work product.
KIMTRAN'S
FULL 41 PAGE APPEAL
Kimtran's Appeal is pending, but I believe
-- though it's better written and more complete than LISA'S
32 PAGE APPEAL written by attorneys Mark Balius and George Kelesis
-- it's still very similar to Lisa's that failed miserably in August 2012:
Both Lisa and Kimtran's Appeals make three
of the same arguments; that third parties ruined the value of the Crazy
Horse Too, that the purported $30 - $45 million dollar proceeds from its
sale was the only means Rick ever agreed to use to pay Henry and the IRS,
and that Lisa and Kimtran are not personally responsible for paying Rick's
court ordered debts even though the Court concluded that he fraudulently
transferred the bulk of his ill-gotten fortune to them in an effort to
avoid paying Henry and the IRS (Kirk Henry has been given priority over
the IRS in order of payment).
Lisa
claimed in her Ninth Circuit Court Appeal that the then-operating Crazy
Horse Too that Rick individually received in the divorce settlement was
valued at the time of their divorce "in excess of $45 million." That was
an outrageous claim that could only be supported if new owners continued
robbing
and beating patrons as was the
Rizzolo's business model. (INSIDE VEGAS photo by Mike Christ showing
Rizzolo leaving court on 02/22/2011 with his "spiritual advisor" Father
Dave Cassilegio)
Lisa also told the appeals court that what
she received in her settlement was worth a fraction of what her ex-husband
got, therefore she should be allowed to keep the community property that
was derived from Rick's criminal activities including cash and assets she
stashed in the Cook Islands out of the reach of Kirk Henry and the IRS.
The Ninth Circuit Court denied her claims,
but she will get another bite of the apple on March 26 when a jury will
hear her pleas.
Not mentioned in Lisa's claims was that
a straw man appeared in 2007 to run the club after Rick began his first
shortened prison sentence. Soon thereafter, the Las Vegas City Attorney
was informed by citizens and the Las Vegas Metropolitan Police that the
straw man slept in Rick's back office while Bart,
Dominic, Annette, and Ralph Rizzolo continued running the business
against the City Council's orders. Upon receiving this information, the
City Council shut
the place down before anyone else could get hurt.
One year after the City jerked the liquor
license, with no business operating,
and after all the purported "buyers"
failed to perform, the adult use zoning expired. Then the recession
hit. Six years later the
court ruled: "As this Court already has determined a reasonable jury
could find the Rizzolos? divorce constituted a fraudulent transfer."
Lisa also failed to tell the Appeals Court
that just before Rick and her 2005 "sham
divorce," the couple borrowed $5 million from a California bank. They
used the Crazy Horse Too as collateral, stashed the money in the Cook Islands,
and never paid a single payment on the loan. It was not the first highly
questionable loan that bank made.
Six years later in July 2011, the bank's
collateral including the Crazy Horse Too was auctioned by the FDIC. A California
investor who owned stock in the failed bank and was trying to recoup
his loss bought the Crazy Horse Too for only $3 million, and is currently
trying to sell it
off. Because of bad loans including the Rizzolo's, the taxpayers ended
up paying for the bank's flawed judgment.
Now,
Herb Sachs (left), the veteran 82 year old attorney for Kimtran Rizzolo,
tells INSIDE VEGAS that he will use a similar argument as used by Lisa
to again try to convince the Appeals Court that the Crazy Horse Too was
once worth at least "$30 million dollars" before it closed, and if sold,
would have covered all of the Rizzolo's debts including the alleged debts
of Sachs' client Kimtran Rizzolo.
However, Mr. Sachs' claim that the property
was ever worth over thirty million was dispelled in 2007 when all purported
buyers "failed to perform" as stated in a letter
faxed to Steve Wynn's representative by Rick Rizzolo's former attorney
Marc Hafer:
Lisa tried many of the same arguments back
in May 2012 as those now planned by Mr. Sachs, but the Ninth Circuit Court
did not concur.
Sachs plans to again tell the Ninth Circuit
Court; "The failure of the government and/or the Henry's attorney to permit
the city license of the Crazy Horse Too to expire, reducing the property's
value from well over thirty million to zero was the fault of either the
city and/or the attorneys for the Henry's."
Here's Lisa's similar argument that was
soundly rejected by the Ninth Circuit Court:
| Case: 12-71545 05/18/2012
ID: 8184651 DktEntry: 1-2 Page: 13 of 32
In September 2006,
the City of Las Vegas revoked the liquor and/or business license of the
Crazy Horse Too. At the time of the revocation, an escrow had been opened
for the sale of the Crazy Horse Too in the amount of $45 Million. The planned
sale of the Crazy Horse Too reportedly failed because of the revocation
of its liquor license which diminished its value. |
It was previously found that the person
purported to offer $45 million in the escrow had no source of funding.
According
to Las Vegas City Attorney Brad Jerbic; "(The buyer), on multiple occasions,
has informed the City staff and the City Council that he has legitimate
commercial financing for the $45 Million purchase of Crazy Horse Too. LVMPD
has repeatedly asked for evidence of this. No evidence has been forthcoming...
LVMPD has been unable to verify any source of funding for the purchase
of the business."
In fact, all the purported "buyers" failed
to perform prior to the expiration of the liquor license, so the claims
that the Crazy Horse Too was once worth tens of millions of dollars is
bogus. It was proven that the only way the Rizzolos made their obscene
profits was through racketeering -- the beating and robbing of bar patrons,
and suspected dope sales and prostitution. As of today the Crazy Horse
Too is a tear down, with multiple structural defects caused by years of
water and sewer leaks under the foundation.
(INSIDE VEGAS photo by the late Buffalo
Jim Barrier)
I've been covering this story since 1999.
During that time I have written dozens of stories about brutal beatings,
at least one murder,
and the corrupt judges,
mayor,
city
councilman, district
attorney, and other
public officials who allowed the crimes to continue.
Now, I expect Kimtran's Appeal will fail
for lack of merit as did the appeals of Lisa and Rick Rizzolo. I also agree
with Judge Pro that Kirk Henry will prevail at his Uniform Fraudulent Transfers
Act trial in March.
Now, my only concern is that Kirk Henry
is paid for his pain and suffering, and that the example set by HENRY v.
RIZZOLO discourages future criminal enterprises patterned after the Crazy
Horse Too, and warns would-be Rick Rizzolos that you cannot stash your
ill-gotten gains in annuities, or in off shore accounts to avoid paying
your debts.
MORE INFORMATION:
Ninth Circuit Court of Appeals
to hear
exaggerated claims about
the value
of the Crazy Horse Too strip
club
INSIDE VEGAS by Steve Miller
AmericanMafia.com
June 18, 2012
http://www.americanmafia.com/Inside_Vegas/6-18-12_Inside_Vegas.html
