Galardi tries to make deal with LV

Sito Negron

Wednesday, Feb. 18, 2004 | 10:15 a.m.

Jack Galardi, who faces losing the liquor license for his topless club Cheetahs, has offered to settle his differences with Las Vegas by paying a $1.017 million fine in exchange for the city dropping further complaints against the license.

"We're in discussions," Dominic Gentile, the lawyer for Jack Galardi, who had appealed the fine in court, said this morning. "I don't think there's anything decided yet."

The offer was made Tuesday in a letter containing photocopies of two checks, for $500,000 and $517,000. The city today is to consider whether to pursue a second complaint against Cheetahs liquor license, held by Galardi's company, La Fuente Inc.

Councilwoman Janet Moncrief, who emerged as a strong opponent of allowing Cheetah's to keep its license, a stand that put her at odds with some colleagues when she sent a letter to the media urging them to support her, was not impressed with the settlement offer.

"I'm just going to stand the way I stood from the beginning," Moncrief said this morning. "It was the worst criminal activity on a special use permit (on record), which is what staff said, and the staff asked for revocation."

The City Council ordered the fine of just over $1 million for criminal acts committed by Jack Galardi's son, Michael Galardi, while the younger Galardi was a 40 percent owner of La Fuente. Last fall, after he pleaded guilty to corruption charges first in San Diego and then in Las Vegas, Michael Galardi retired his share of the company, giving full ownership of La Fuente to his father, Jack Galardi.

During the first penalty hearing, the city's chief litigation counsel, William Henry, told council members that Michael Galardi's crimes "went to the heart of the regulating authority."

The fine amount was based on city statutes that allow up to $1,000 a day for each day of violation -- between August 2000 and May 2003.

Acting for Jack Galardi, Gentile appealed the fine, claiming in court that the city did not have jurisdiction to impose the penalty, which he called "arbitrary and capricious."

He argued that that the city has no jurisdiction regarding discipline in connection with the license because Michael Galardi was not convicted. Gentile also noted that two portions of the city code conflict over whether a conviction is required for disciplinary action.

The court case is pending.

The city's first complaint was based only on Michael Galardi's guilty plea in San Diego. The city's second complaint, which if approved today would be followed by a hearing to assess potential penalties, is based on Michael Galardi's guilty plea in Las Vegas.

Also part of the second complaint is the charge that Jack Galardi did not get the council's approval of the ownership transfer when Michael Galardi gave up his share in the company.

City rules say that ownership transfers of more than 10 percent must be approved by the council. Gentile has argued that Michael Galardi simply retired his 40 percent stake in Cheetahs in October, and no ownership interest was transferred.

Mark Vincent, city finance director, said disposition of the second complaint "is really up to council."

"I certainly think the second complaint is a valid complaint and worthy of council's consideration," Vincent said.

Gentile said he wants Las Vegas to drop any further charges against Las Fuente's license in exchange for paying the fine.

"It's a typical settlement (offer). Any time you settle any type of litigation you settle all differences that may exist, otherwise there's no motivation to settle. All you're going to do is close one lawsuit and start a new one. It doesn't make any sense."