The federal government has wanted to unload the Crazy Horse Too strip club in Las Vegas ever since the U.S. Marshals Service assumed ownership of it in 2007 as part of a plea agreement with its former owner, felon Rick Rizzolo.
After two years and at least one failed attempt, the marshals finally have an agreement in place, largely confidential, with a new potential buyer, Mayor Oscar Goodman and several attorneys close to the case confirmed late last week.
Pete Rinato, a local attorney for the prospective buyer, said the buyer signed a contract with the Marshals Service about three weeks ago. He declined to name his client, who he said is a “non-local,” but added that his name would be released soon.
In a larger sense, an alliance of sorts has been formed, said several attorneys knowledgeable about the deal, a kind of “strange bedfellows” pact in which many of the normally adversarial parties are now allied because they’re eager for the sale to go through.
Those parties include the prospective buyer, the federal government, Rizzolo and the man who successfully sued the now-shuttered club after his neck was broken there. This alliance doesn’t yet include the city, though it might before all is said and done.
The agreement hinges on the owner of a Russell Road strip club, calling itself the Crazy Horse 3, giving up that name so future owners of the Crazy Horse Too, on Industrial Road, can retain sole rights to the name.
The pact is also relying on the city to grant a liquor license and exotic dance permit to the club’s buyer, so the value of the club can be boosted. Without a liquor license, the club is valued at about $5 million — chump change compared to what it would be with the proper licenses. As of 15 months ago, with the licenses, the club was valued at $32 million.
Rinato said a lawsuit will soon be filed against the owners of the Crazy Horse 3, demanding that they give up that name.
After serving roughly 10 months in federal prison for tax evasion, Rizzolo was released in early 2008. As part of his guilty plea, Rizzolo was allowed to use proceeds from the sale of the gentleman’s club to satisfy tens of millions of dollars in debts he owes various parties.
Goodman said he didn’t know who the potential buyer is- and hasn’t asked.
Others who do know, include federal officials, but they aren’t talking.
Federal agents seized the Crazy Horse Too in September 2007. The following June, Pro criticized the marshals for not applying for a city liquor license and simply taking over the club.
At the time, the marshals said they didn’t want to run a strip club. Three months later they changed their tune, recognizing that they needed the licenses to get a higher sale price.