Las Vegas City Commission Minutes, November 7, 1949 to May 21, 1952, lvc000007-421

Pursuant to the instructions of the Board of Commissioners that I in­vestigate the above named application in connection with his request for a renewal of gaming license for the Eldorado Club, Inc., I wish to advise as follows: Dr. Berstein owned a 10% interest in the Fremont Arcade acquired in 1941 with Roscoe Thomas, Art Ham and Guy McAfee. This interest was sold to Guy McAfee in 1950. In 1944 Dr. Bernstein acquired a 7½% interest in the Frontier Club with the same group above mentioned and on or about the year 1947 sold this 7½% interest to one Alex Block. In 1950 he purchased two-thirds (2/3) of the real property upon which the Frontier business is located from Messrs. Wengert and Ronnow and still owns that 2/3 interest. In 1950 he purchased 2½% of the Frontier Club stock from Mr. Schellang and still owns this interest. In 1944 Dr. Bernstein purchased and owned 10% in the El Rancho Vegas and later in the same sold his interest to Wilbur Clark. At the time his interest was acquired in this operation the other owners were Messrs. Clark, Barish, and Wilkerson. Dr. Bernstein acquired a 6% interest in the Golden Nugget at the time of its organization and building and later sole 2% of this amount. He has owned since its inception, and still owns, 4% of this business. His realty holdings in the past in the Las Vegas area include the co-ownership of the Flamingo Hotel real property, prior to the building of the hotel, with Mr. Wilkerson. In addition he owned real property in Henderson, Nevada. In 1945 Dr. Bernstein purchased the lease on the premises sub­sequently occupied by the Eldorado Corp., Clover Club, etc. Thereafter, a suit was brought in the Federal Court for an accounting as a result of claimed failure to pay the amounts due Dr. Bernstein on the lease. This matter was settled by a sale by Dr. Bernstein and the payments to him by Mr. Rosen and other operators. The operators of the business got into difficulty involving their licenses late in the year 1950 and being de­linquent in their payments the Dr. went into possession as of December, 1950, to protect his leasehold interest. Thereafter a license was granted to Eldorado Club for the 1st quarter, 1951, with Dr. Bernstein as president of the corporation and Attorneys Louis Wiener and Dave Zenorr as the other officers. The second quarter, 1951, the license was issued to the Eldorado Corporation, Inc., dba the Clover Club with the same officers. The third quarter 1951, a renewal was applied for with Dr. Bernstein as president of the corporation and Mr. Hibbs and Mrs. Chandler as the other officers. Dr. Bernstein operated the Eldorado Club during the months January, February and March, 1951, and claims to have operated at a profit. Thereafter, due to difficulty with Mr. Silvagni, the owner of the premises, a nominal oper­ation was continued so that the lease would not be violated and the licenses cancelled. During the 2nd Quarter, Mr. Binion purchased Silvagni's 1/2 interest of the slot machines for $175,000, by payment of $50,000 cash with a note due January, 1952, in the sum of $62,5000 and a note due in January, 1953 in the sum of $62,5000 with Dr. Bernstein required to co-sign on the notes. Thereafter Binion purchased the bar from Matt Howard and Binion and Dr. Bernstein entered into an agreement for the sale and purchase, respec­tively, of the Eldorado Club, including the lease holdings. Mr. Binion was to pay $50,000 of the Eldorado corporate debts assumed by Dr. Bernstein in the total amount of $87,000 and Dr. Bernstein to pay the remaining sum of $37,000, which was done. Mr. Binion was further to pay to Dr. Bernstein $1500 a month plus 12½ of the net profits. When Mr. Binion could not ac­quire a State License the sale was voided with Mr. Binion given an option to purchase on the same conditions for a two year period provided he obtains a license. In the meantime, Binion started to remodel the premises and spent approximately $350,000. An audit is now being made to determine the exact amount Binion has put into the premises and after this has been completed the corporation will give its note to Mr. Binion for that amount of money. Dr. Bernstein is the sole stock holder of the corporation and claims no other person has an interest in the corporation. He further advises that he intends to start with a bank roll of $100,000 and can raise $150,000 with­in three (3) days if necessary. The corporation owes no debts except a claim by Ira Goldring in the amount of $5100.00, which is disputed, and one other bill in the sum of approximately $60.00. Dr. Bernstein further represents that Mr. Pat Collins will act as manager of the operation. In my investigation of licenses it appears that Dr. Bernstein was not on the license nor an officer of the corporation at the time the license came in jeopardy. The record in the City Hall shows further that Dr. Bernstein was on the Golden Nugget license for the last quarter of 1949, first quarter of 1950, and second quarter of 1950. The third quarter of 1950 the Golden Nugget ap­pears as a corporation and Dr. Bernstein was not listed as one of the officers. The Doctor does not appear on the Eldorado Corporation license nor any other corporation licensed for the Apache Hotel premises, prior to the first quarter of 1951, and he was licensed both by the State and the City for the first and second quarter of 1951.