Pinnacle sees setback in attempt to block former exec from competing

By Steve Green

Published Friday, Dec. 10, 2010 | 9:53 a.m.

Updated Friday, Dec. 10, 2010 | 3:15 p.m.

Casino operator Pinnacle Entertainment Inc. of Las Vegas suffered another setback Thursday in efforts to block former CEO Dan Lee from competing against Pinnacle in Lake Charles, La.

D. Kent Savoie, a state judge in Louisiana, signed an order granting partial summary judgment to the port of Lake Charles in a lawsuit that Pinnacle had filed against the port.

In the order, Savoie dismissed Pinnacle's request that he block the port from working with Lee's company, Creative Casinos LLC, on plans for a casino resort at Pinnacle's former proposed Sugarcane Bay casino site in Lake Charles.

Savoie, a judge in Louisiana's 14th District Court for Calcasieu Parish, found a 2007 lease between Pinnacle and the port for 50 acres at issue in the lawsuit is unenforceable because Pinnacle surrendered its gaming license for the site after canceling the Sugarcane Bay project earlier this year.

The dispute pitting Pinnacle against the port and Lee erupted after Lee left the company last year and started working on plans for a casino resort called Mojito Pointe.

Mojito Pointe would be near Pinnacle's existing L’Auberge casino, at the now-canceled Sugarcane Bay site.

As Pinnacle’s CEO, Lee worked to develop Sugarcane Bay. Last month, Pinnacle sued Lee in a Nevada state court, charging his efforts to develop Mojito Point involved violations of his separation agreement -- charges denied by Lee.

Clark County District Court Judge Kathleen Delaney on Nov. 22 denied Pinnacle's motion for an injunction barring Lee from competing against Pinnacle, and that lawsuit remains active.

In order to develop a casino at the Lake Charles site, Lee first must win Louisiana's 15th and final casino license.

Presentations to Louisiana regulators concerning the license are set for Dec. 16 by Lee and developers of competing proposed casinos.

Jack Godfey, general counsel at Pinnacle, said Friday the company was considering its options regarding Savoie's ruling.

He noted the lawsuit against the port remains active with Pinnacle still asserting financial claims against the port as well as a claim of non-compatability of the proposed development with the L’Auberge lease.

"We're continuing to protect our rights" with the cases against the port and Lee, Godfrey said.