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October 24, 2014

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Legal battle heats up over finances of Eva Longoria’s Beso nightclub at CityCenter

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Erik Kabik/Retna/www.erikkabikphoto.com

Eva Longoria Parker hosts the grand opening of her Beso restaurant and Eve Nightclub at CityCenter on Dec. 3, 2009.

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Eva Longoria Parker and Kim Kardashian at Beso and Eve on Dec. 30, 2009.

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The grand opening of Beso restaurant and Eve Nightclub at CityCenter on Dec. 3, 2009.

Eva Longoria faces more legal drama as an investor in her Las Vegas restaurant Beso is asking that Beso's Jan. 6 bankruptcy petition be thrown out of court, charging it was filed in bad faith.

Attorneys for the investor, Mali Nachum, said in court papers filed Tuesday that Beso at the Crystals mall was "operating at a huge profit margin" while she and her husband Ronen Nachum were managing the restaurant and Eve nightclub.

But after the Nachums were removed from the business on May 5, 2010, the new management "effectively ran the restaurant in to the ground," Mali Nachum's court filing says.

New information surfaced, in the meantime, showing Beso filed for bankruptcy in part because it faced eviction because it was delinquent on lease payments to the high-end Crystals shopping center. Crystals is owed at least $1.8 million, records show.

Crystals is part of the CityCenter casino-resort complex on the Las Vegas Strip. MGM Resorts International co-owns and manages CityCenter.

Tuesday's court filing by Nachum brings to three the number of courts in which she and Ronen Nachum are in litigation involving Beso and Longoria.

The legal actions started in June, when the Nachums sued Longoria and fellow Beso investor Jonas Lowrance in Clark County District Court in Las Vegas, charging they were wrongly removed as Beso managers and from the Beso partnership and that the partnership owes them hundreds of thousands of dollars.

After the Jan. 6 bankruptcy filing, Mali Nachum filed suit on Monday in state court in Los Angeles charging an agreement in which Longoria loaned money to Beso violates California usury laws.

Tuesday's court filing in the Las Vegas bankruptcy case of Beso focuses on either having the bankruptcy case dismissed or entry of an order lifting the "automatic stay" of the Clark County District Court litigation in Las Vegas.

Attorneys for Mali Nachum -- Matthew Callister and Matthew Pawlowski of the Las Vegas firm Callister + Associates LLC -- said in their filing that the Beso bankruptcy was improper.

According to Nachum's attorneys, Beso says it's being managed by a Nevada company created Jan. 4, Beso Mangement LLC, which is headed by William Braden of San Antonio, described as Longoria's accountant.

But the Nachums insist a company called ROK Management Group LLC -- owned by Mali Nachum and Lowrance -- is the only authorized manager of Beso.

Mali Nachum's court filing charges that on May 7, Longoria and Lowrance tried to remove ROK as manager of Beso by filing an annual list of managers and managing members with the Nevada Secretary of State listing Lowrance at that time as the sole manager of Beso.

Mali Nachum's brief charges that appointment is invalid because there was no meeting of the members of Beso to approve the action.

"The filing of an untrue annual list with the Nevada Secretary of State was a violation of Nevada law," Mali Nachum's filing said.

At the heart of the dispute between the Nachums, Longoria and Lowrance are claims by the Nachums that they did a good job in supervising the development and operation of the Las Vegas restaurant and club, yet were kicked out of the business and are owed money -- and conflicting claims by Beso, Longoria and Lowrance that the Nachums mismanaged the business and that Ronen Nachum embezzled money from Beso.

In her Tuesday court brief, Mali Nachum said that in 2006 Ronen Nachum successfully oversaw construction of the Beso restaurant in Hollywood and that one of the Beso Las Vegas investors later asked him to supervise construction of the Las Vegas restaurant.

The Nachums initially received a 21 percent membership interest in Beso for services supervising the construction of Beso Las Vegas, Tuesday's filing said.

"Beso Las Vegas opened on time (on Dec. 3, 2009), as promised by the Nachums, due to Ronen Nachum's supervision and dedication to the construction progress," the filing said.

Shortly after Beso and its Eve nightclub opened, the businesses' director of operations resigned and Lowrance and the Nachums took over, the filing said.

Among the problems the Nachums had to deal with was that after the resignation of the former director of Eve, who wasn't identified, the Nachums discovered he "had run up an approximately $400,000 debt to Beso's liquor supplier, which threatened Eve's viability as a going concern because the supplier could cut off sales of liquor if Beso did not pay its outstanding balance," Nachum's filing said.

The filing also said that at some point the Nachums became aware of an April 22, 2010, e-mail falsely insinuating "Ronen Nachum was stealing cash from the company and that claimed Ronen Nachum was acting like a 'tyrant.'"

These allegations were repeated by Longoria, Lowrance and Beso in a Nov. 15 counterclaim against the Nachums in the Clark County District Court lawsuit.

That filing said that while Ronen Nachum made representations that he was a licensed contractor who was qualified to oversee the construction of Beso, he was not a licensed contractor in Nevada.

Operating under the contractors license of Baz Construction LLC, Ronen Nachum controlled every aspect of the construction with BAZ involved in name only, the counterclaim says.

It says Ronen Nachum's "serial mismanagement" of the construction of Beso led to the filing of some $1.2 million in construction liens as well as lawsuits and breaches of Beso's lease agreement with Crystals at CityCenter.

Later, in managing Beso, "the Nachums operated as though they were members of a criminal enterprise rather than investors in a restaurant and nightclub," the counterclaim says.

"Although Ronen Nachum was not himself a member of Beso LLC, he nevertheless acted as the de facto owner of Beso through the assistance of Mali Nachum, using his access to engage in a chronic pattern of theft, intimidation and brutal mismanagement of the business," the filing said.

In denying those allegations Tuesday, the attorneys for Mali Nachum said the Beso bankruptcy filing was "quite clearly and transparently an action brought to avoid the current, pending state-court litigation of Beso and to essentially seek an alternate forum for the two-party dispute."

"As such ... the (bankruptcy) petition should be dismissed in its entirety" on the grounds of bad-faith filing, wrote Nachum's attorneys, who said Mali Nachum is owed about $400,000 by Beso and is at risk of not being paid because of the bankruptcy.

The filing said Mali Nachum and other creditors have a significant interest in seeing the current management of Beso "removed of their ill-equipped command of the restaurant, thereby allowing the restaurant to recover from its mismanagement."

"The appropriate remedy lies within the (Clark County) District Court, to appoint a receiver over the restaurant and continue operations through a qualified and competent manager, as opposed to the persons and entities currently running the establishment," Nachum's Tuesday filing says.

Separately, a court exhibit shows Beso's Las Vegas bankruptcy attorney, Lenard Schwartzer, on Jan. 7 told Matthew Callister, one of Mali Nachum's attorneys, that the Nachums should be supportive of the bankruptcy filing.

"This debtor is very delinquent on its lease to Crystals, facing eviction and is unable to reorganize its finances outside of bankruptcy. Unless your client merely wants to see the debtor cease operating, they should support the opportunity to reorganize," Schwartzer said in an email.

Attorneys for Beso and Longoria have not yet responded to Mali Nachum's filing of Tuesday. A February hearing has been scheduled on the motion that the bankruptcy case be dismissed or that the stay of the Nevada state court litigation be lifted.

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  1. What a mess.

  2. A word of advice to any actors or sports stars who are deriving great pleasure from reading about this restaurant's legal fiasco.
    Let this be a lesson to other movie or sports celebrities.
    Stick with the craft you know and have mastered.
    Don't let smooth-talking financial advisors persuade you to branch out into "sure-fire" investments.
    Stay debt-free, pay all your taxes honestly and on time, and invest your spare money in ultra-safe
    places only, like bonds or term deposits.
    You've already hit the income home run in your chosen field. Don't risk your success by diversifying.
    That way might seem boring, but you can stay happy and free of embarrassing controversy and accusations.

  3. This is the kind of b.s. deal that costs everyone but the people that owe the dough a pile of money.

    Eva's a doll... but c'mon! Did anyone REALLY think this was gonna be a huge, long-term, successful business venture?

    It was a (very expensive) party for the well-heeled and their pals, until somebody figured out the whole thing was a shell game with money.

    Another one bites the dust.

  4. If only these aspiring restauranteurs/night club operators would read Anthony Bourdain's book, Kitchen Confidential, they might reconsider trying to get into one of the most difficult businesses that one can enter. The gentleman from north of the border, as usual, has some sound advice. Eva is going to lose a bundle on this deal. I think she has already advanced 1.375 mil to Beso, LLC as an unsecured loan. Add to that the legal fees involved in defending/being represented in multiple lawsuits. What a nightmare, get out Eva, cut your losses before you become a truly desperate housewife!!

  5. All this make me appreciate my dog- even more!!!

  6. I guess some of these celebs didn't learn from the Planet Hollywood fiasco with all those well-known names involved. How long did their involvement last? A year or two?

    This sounds more like a pissing match than a legal matter - "they said", "she said", "they did" "they didn't do".

    Settle it Eva.

    PS DOesn't she own or is part owner in a restaurant in LA that is successful? Maybe that is why she went with this venture but just hired the wrong people.