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November 24, 2014

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Whittemore lawsuits raise curtain on political deals

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Steve Marcus

Harvey Whittemore, the former lobbyist and businessman behind the stalled Coyote Springs development, looks out in 2006 over a portion of 43,000 acres he purchased for $15 million.

Former lobbyist Harvey Whittemore’s financial troubles, detailed in lawsuits and clouded by an FBI investigation, have pulled back the curtain on some dealings among Nevada’s power elite.

Wingfield Nevada Holding Co., Whittemore’s company, paid R&R Partners, the state’s most powerful lobbying firm, $70,000 a month for more than five years, the Las Vegas Sun has learned.

Whittemore also ordered the company in 2004 to loan $250,000 to Pete Ernaut, a principal at R&R and a political adviser to former U.S. Sen. John Ensign, Gov. Brian Sandoval and other prominent Republicans.

Whittemore forgave the loan, for which there was no documentation, three years later, according to a lawsuit filed by his business partners.

Neither R&R nor Ernaut are referenced by name in the lawsuit. But sources with knowledge of the case confirmed their identities to the Sun.

R&R Partners CEO Billy Vassiliadis said the company’s work for the Coyote Springs development included lobbying, advertising and public relations. Ernaut said the portrayal of the loan in the lawsuit is "not accurate.”

It shouldn’t be surprising to find well-placed figures involved in Whittemore’s business dealings. He was until recently a prodigious political fundraiser.

On one day in 2007, Whittemore and people associated with him contributed $124,200 to Sen. Harry Reid, according to Las Vegas Sun columnist Jon Ralston.

Whittemore was also one of Nevada’s preeminent legislative lobbyists. The complaint said that between January 2004 and June 2010, he took $600,000 in cash from Wingfield for meals and entertainment. “Wingfield employees always kept approximately between $5,000 to $10,000 in cash in $100 denominations in a safe in the office,” according to the complaint.

Whittemore was a daily presence at the Legislature until about 2003, when he shifted his focused to a grander project: Coyote Springs.

•••

Coyote Springs would be a massive housing development — 43,000 acres, 159,000 homes — 50 miles outside Las Vegas, on the border of Clark and Lincoln counties.

To develop it, Whittemore formed a partnership, first with Thomas Seenos in 2004 and then his brother Albert D. Seeno Jr.

The Seenos are partners in the Peppermill Resort Casino in Reno and housing developers in Northern California and Northern Nevada.

The project was just beginning to gather momentum as the recession hit. Today, evidence of the grand plans includes a Jack Nicklaus golf course and some signage.

At some point, the business relationship between Whittemore and the Seenos turned contentious. And on Jan. 27, the Seenos' attorneys filed a lawsuit, alleging that Whittemore used their companies to fund his standing in the Nevada political community.

A few days later, Whittemore and his wife, Annette, filed a countersuit, alleging the Seenos had ties to organized crime and had threatened the Whittemores. They alleged Albert Seeno, Jr., said “he would personally bring down every member of the political ‘machine’ in Nevada, including references to U.S. senators.” He also said, according to the lawsuit, that “he would bring down any business or friend associated with Mr. Whittemore.”

After the lawsuits were filed, the FBI interviewed Nevadans about campaign contributions tied to Whittemore and subpoenaed documents, sources told the Sun.

Sens. Harry Reid and Dean Heller, and Rep. Shelley Berkley have donated contributions from Whittemore to charity.

“Understandably, based on the reckless accusations made in the civil lawsuit ... law enforcement is requesting information from knowledgeable parties,” Elizabeth Trosper, the spokeswoman for Whittemore’s attorney, told the Reno-Gazette Journal this week.

Trosper told the Las Vegas Sun that Whittemore and his attorneys would have no further comment at this time.

•••

Billy Vassiliadis, CEO of R&R Partners, said his firm was on retainer for the Coyote Springs project but would not discuss how much the firm was paid.

The $70,000 figure would dwarf what the state’s largest industries pay lobbying firms during legislative sessions, which sources said is at the most $25,000 a month.

The complaint said that between February 2005 and July 2010, Wingfield and its associates paid almost $4 million to R&R. Some of the work was for the Whittemore Peterson Institute for Neuro-Immune Disease, which is housed at the University of Nevada, Reno, according to the complaint.

Vassiliadis said the work his firm performed went beyond lobbying and included “the full spectrum. Public relations strategies, research, government affairs — the whole shooting match.”

Kent Robison, attorney for the parties suing Whittemore, said what the company did for that money will be examined as the case progresses. “All of our allegations in the complaint will be subject to the discovery process and thoroughly investigated,” he said.

Robison would not comment on the $250,000 loan to Ernaut. But the complaint alleges Whittemore used the company to benefit “personal friends and business contacts. Whittemore made loans of hundreds of thousands of dollars to his personal friends from Wingfield accounts,” it states.

It also alleges that Whittemore didn’t seek approval or consent from the Seenos for the loans, some of which were never documented.

Ernaut said because the matter was going to be litigated, he would not go into details.

“This is a situation involving close friends and clients,” he said. “Given the accusations flying around, given the multiple lawsuits, it would be irresponsible to comment at this time.

“My private business matters are just that: private. I take my personal and profession reputations very seriously. If there’s any effort to drag me or my family through the mud, it will be met with a swift and vigorous response.”

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  1. Gee, what a surprise! A lobbyist under suspicion of having dirty hands. Who'd have thunk it? Paid lobbying should be outlawed or, at the very least, made a non-deductible expense for tax purposes. Lobbying is often a way of laundering bribe money to venal & corrupt public officials. How else do certain companies, especially in Clark County, get most of the big ticket contracts? By blatant favoritism and cronyism, that's how and the means to that end is often facilitated by oily lobbyists funneling money to less-than-honest officials.

  2. Gee, LV "Facts," your side of the aisle gave us unlimited campaign spending. How do you propose to keep lobbyists from exercising THEIR free speech rights? Or do "rights" only matter to the right-wing when they need to lie?

  3. Ok folks, let's keep our Casablanca [I'm shocked, shocked I say] moments to the minimum. Politics is a knock-down, drag-out business and has been for many years [see Machiavelli, N. The Prince]. One of the best, LBJ, is reputed to have said that if you can't "...eat their food, drink their booze, screw their women, take their money then vote against them..." you shouldn't be in politics. Mr. Wittemore made a mistake in allowing a couple of amateurs to buy in the the operation and we all know that amateurs screw things up for everybody.

    This is a great story which will keep pundits employed and political junkies fixed for a couple of years.

  4. Sorry, Michael, but you're wrong. "My side" did nothing. It was the U. S. Supreme Court that made the ruling and I agree with it. Apparently, you do not. That's the American way we know & love. We can disagree without being disagreeable. And I did not "propose to keep lobbyists from exercising their free speech rights." I only proposed making the expenses non-deductible. After all, when you contact your legislator, can you deduct the costs as a "business expense?" I think not. Buying steel to form a fender on a car is a "business expense." Leasing computers to do desk-top publishing is a "business expense." Paying your employees for work performed, well, it's a given that it's a legitimate "business expense." Greasing the palms of bureaucrats? No way is that a "business expense." The left is constantly railing about "corporations" having too much sway when it comes to legislation. Making corporations and other businesses shell out non-deductible money to grease politicians would make them a bit more careful in how they "spread the wealth." I don't want to help GE, Boeing, Wal-mart or Miller Brewery, etc. pay for their self-serving lobbying efforts. Do you? Along with that, we have to rein in the unions as to how they spend members dues on partisan political agendas. Let's face it, many union members are not "progressives," liberals, conservatives, Dumbocrats or Republicrats. Many don't care about politics at all. Yet the outlay by unions on partisan politics is massive; generally their biggest cost outside of health & welfare benefits. That's not fair to those footing the bills in the form of higher & higher dues. Reduce members dues by the amount now being spent on lobbying & campaign contributions and let individual members decide for themselves whether they want to support anyone or spend the money on something else. Have the unions get back to basics - negotiating contracts with the businesses of the employees they represent.

  5. R&R is, of course, one of the biggest lobbying firms in the state. It is interesting to note, though, that they also work for the Southern Nevada Water Authority, and the company also vigorously lobbied for the Water Grab pipeline - the same pipeline Whittemore needed to build his new city at Coyote Springs, according to SNWA boss Pat Mulroy.