Lawsuit over restaurant slot contracts settled

Wednesday, July 5, 2000 | 10:51 a.m.

A slot machine operator agreed to dismiss a lawsuit it filed June 23 against four Las Vegas-area restaurants and their parent company for allegedly terminating five-year slot lease contracts early.

Green Valley Gaming Inc. of Las Vegas had sought $500,000 in restitution from Dine West Inc., parent company of Sahara Diner Inc., Pebble Diner Management Co. LLC, Flamingo Diner LLC and Stephanie St. Diner Inc.

Green Valley alleged the defendants improperly demanded to have Green Valley's slot machines removed from their restaurants and refused to reimburse Green Valley for gaming license fees. Green Valley said it had to file for licenses before the Nevada Gaming Control Board, Clark County and the cities of Las Vegas and Henderson.

"It's a misunderstanding," said Kenneth Green, Dine West's president. "Both parties have now agreed that the slot machines aren't going to be placed in the restaurants ... It isn't financially feasible because Green Valley needed a full-time person watching the machines to ensure no underaged people played them."

He declined to reveal further details of the settlement.

The suit said the four restaurants agreed in July 1999 to grant Green Valley exclusive rights to provide slot machines at the restaurants for five years after it obtained government licenses and approvals.

Green Valley, which was to pay the restaurants $175 a month in rent for each slot machine, allegedly had the sole right to terminate the agreement and to remove its machines.

The suit said that after Green Valley started to install slot machines at the Flamingo and Stephanie Street restaurants, Don Souffrant, Dine West's director of operations, told the Gaming Control Board the restaurants wanted to terminate the contract because of customer complaints.

"Before the machines were turned on, our guests saw them and were very vocal in their opposition to having gaming in our restaurants ... I contacted Green Valley Gaming to have them removed and not installed at our Sahara and Eastern locations," said Souffrant in a March 16 letter to the board.