Atlanta lender sued over LV casino loan fee

Monday, Feb. 5, 2001 | 11:18 a.m.

Flamingo Paradise Gaming LLC sued to recover a $350,000 fee from an Atlanta lender after negotiations collapsed for a $36 million loan to build Terrible's hotel-casino in Las Vegas.

The $65 million locals-oriented hotel-casino on Paradise Road at Flamingo opened Dec. 6 at the site of the former Continental hotel-casino.

The 400-room hotel-casino is the largest owned by Herbst brothers Ed, Tim and Troy, who currently own two smaller casinos in Pahrump and E-T-T Inc., the second-largest slot route chain in Nevada. The Herbst family also owns the Terrible's chain of convenience stores and gas stations.

In a U.S. District Court lawsuit, Flamingo sued Choice International Corp., alleging the lender repeatedly refused to return what Flamingo called a "refundable commitment fee" after the Atlanta lender and the Herbst brothers didn't come to terms on a loan.

Negotiations reached an impasse and both parties agreed that Choice would not provide the $36 million loan, the suit said.

Vestin Mortgage of Las Vegas provided the $36 million loan and the Herbst family provided the rest of the financing for the project, a Vestin official said.

Choice could not be reached for comment.