Boys and Girls Clubs could net $5,000 from Station Casinos bankruptcy

By Steve Green

Wednesday, Dec. 15, 2010 | 1:06 p.m.

The Boys and Girls Clubs of Las Vegas may be receiving a $5,000 donation from an unlikely source: the Station Casinos Inc. bankruptcy.

Station, as it prepares to exit bankruptcy, this week asked Bankruptcy Judge Gregg Zive in Reno for permission to cash out certain creditors that otherwise would receive warrants to buy an ownership stake in the company emerging from bankruptcy.

Among these creditors are some 22,400 current and former Station workers entitled to receive payments after Station settled a class-action lawsuit charging the workers were shorted on pay because a timeclock system had improperly rounded their hours worked.

The settlement resulted in Station agreeing to fund $1.2 million in payments to certain workers as well as the legal and administrative costs of the case. That's expected to yield payments of $64 to $74.51 for Station workers employed from Jan. 29, 2009, to July 16, 2010.

A second component of the settlement gave workers an unsecured claim valued at $5 million in the bankruptcy case. This claim is for people employed by Station from Feb. 4, 2005, to Jan. 28, 2009.

In court papers this week, Station said that as part of the process of resolving this claim, the workers would receive warrants that turned out to be worth 12 cents in cash for each of the 22,400 workers.

Since it would cost more than $60,000 to issue and send checks for 12 cents to each of the 22,400 workers totaling $2,850, attorneys for Station this week proposed an alternative.

"The debtors seek authority to make the expected $2,850 aggregate cash-out payment to the (class-action plaintiffs) to a charity in the Las Vegas area that serves the needs of the members of such class – the Boys and Girls Clubs of Las Vegas – under the doctrine of 'cy pres,'" attorneys for Station said in a court filing.

"Cy pres" is defined as carrying out the intention of one making a payment when literal compliance is impossible.

"Whether distributing warrants or cashing them out, it is entirely impractical to make any payment other than a lump sum payment to a charity that would provide benefits to the debtors’ employees, like the Boys and Girls Clubs of Las Vegas," Station's brief said. "The debtors seek an exemption from distributing warrants or cash to the individual members of the (class action) and seek authority to make a lump sum $5,000 charitable contribution to the Boys and Girls Clubs of Las Vegas in lieu thereof."

Court records show several current and former Station employees opted not to receive any payment from the settlement. Most didn't say why, but a few did.

"I have worked at Texas Station for five years. I do not feel as though Station Casinos has mistreated me in any way. For this reason I would like to be removed from the class action lawsuit," one worker wrote the lawsuit claims administrator.

"I have not had a problem with the issues in this case and do not believe it is right to accept money for issues that did not affect me," another employee wrote.