Columnist Jeff German: Slogan deal approved quickly and under radar

Wednesday, June 29, 2005 | 10:45 a.m.

The Thunderbirds would be proud of the precision by which R & R Partners flew off with the lucrative rights to the most successful marketing slogan in the history of the Las Vegas Convention and Visitors Authority.

But the members of the LVCVA board, who by all appearances so far were duped into paving the way for the $1 sale of "What happens here, stays here," shouldn't be smiling today.

This deal went down so fast that the clueless board members -- some of the brighter minds in the community, including Las Vegas Mayor Oscar Goodman and Henderson Mayor Jim Gibson -- didn't even have a chance to blink.

Gibson, who chaired the board at the time, tells me he's embarrassed by it all and wants some answers.

"There are a lot of questions that will be asked, and I expect we're going to get the answers to those questions," he says.

The agreement was locked up, records show, through a series of orchestrated events on Nov. 9 that began when LVCVA President Rossi Ralenkotter, longtime buddy of R & R Partners CEO Billy Vassiliadis, asked the board at its regular meeting to approve changes to its governing policies.

The summary of the agenda item gave the board members no inkling of what they were about to approve.

It said: "Staff has consolidated and compiled all former board polices into one document, incorporating changes that are required by statutory amendments and current business conditions."

The summary then went on to talk about some of the changes being recommended, primarily relating to the Ralenkotter's duties, such as increasing his spending authority without board approval from a ceiling of $25,000 to $50,000.

Included in the backup material was the 10-page policies document, and buried deep within it was an innocuous item giving Ralenkotter responsibility to "register, protect and assign all intellectual property" of the LVCVA without having to present it to the board.

This new responsibility (item number 23 of 24 items relating to the president's duties) wasn't mentioned in the summary. And it certainly wasn't linked to "What happens here, stays here," which happens to be intellectual property.

Gibson says he can't recall any discussion at all about those two subjects.

But this little item was vitally important in the clandestine effort to put the valuable slogan back in the hands of R & R Partners, which created it for the LVCVA.

The story we keep hearing from Ralenkotter and Vassiliadis is that the agreement was struck solely to allow R & R, which has held the LVCVA's marketing contract for 25 years, to pursue legal action against those who have been infringing on the prized slogan.

But what Ralenkotter and Vassiliadis don't like to talk about are the flaws in the agreement -- the biggest of which is that it appears to legally turn over all rights to profit from the trademark, which some experts say could be worth millions of dollars to R & R.

Back at the meeting, meanwhile, the unsuspecting board members, following a motion by then County Commissioner Mary Kincaid-Chauncey, voted unanimously to approve the new written board policies, with apparently no debate, according to the minutes.

Now that he was free to wheel and deal with Vassiliadis without the board's interference, Ralenkotter moved quickly to cement the deal behind closed doors.

He no longer had reason to worry that any inquisitive board members might want to question what he was doing.

On that same day (Nov. 9) Ralenkotter and Vassiliadis signed an eight-page agreement giving R & R the rights to "What happens here, stays here."

R & R lawyers also express-mailed an application to the U.S. Commissioner of Trademarks in Alexandria, Va., to market "souvenirs and clothing" under the "What happens here, stays here" name.

In a flash the mark was gone, and the board members never knew what hit them.

But they know it now.