Shareholder files suit over casino complimentaries

Tuesday, April 1, 2003 | 11:14 a.m.

MGM MIRAGE shareholder and customer John Michael Schaefer has filed suit in U.S. District Court in Las Vegas over the company's practice of refusing him complimentaries.

Shaefer is a Las Vegas attorney who calls himself a "shareholder advocate" and has sued several casinos over personal issues and on behalf of casino customers. Any person who gambles enough to be entitled to complimentaries shouldn't be discriminated against, he said Monday.

"Plaintiff is one of those persons singled out as a matter of policy to be discriminated against, by prohibiting ordinary thank-you complimentaries," the suit states.

"I think that's a lousy policy as a stockholder," he said.

Schaefer is asking for a temporary restraining order or a preliminary injunction to prevent the company from printing its shareholder proxy materials today so he can include a shareholder proposal that would require stockholders to vote that the company should have a consistent complimentaries policy. The company's annual shareholder meeting is May 13.

U.S. Securities and Exchange Commission rules allow shareholders to include policy changes but not matters relating to ordinary operations, Schaefer said.

"This is clearly without merit," said Alan Feldman, a spokesman with MGM MIRAGE. "We have already received approval with the Securities and Exchange Commission to move forward."

Schaefer was disbarred from practicing law in Nevada in 2001 but is an active member of the State Bar of California. He claims the procedure to disbar him began over a newspaper ad that invited customers with disputes with particular casinos to call him for legal advice -- a move that inflamed the gaming industry, he says.

Several years ago, he also filed suit against Mirage Resorts Inc. for failure to extend him credit. A federal judge in Las Vegas ruled that the company has the discretion to extend or reject credit to anyone it pleases.