LAS VEGAS – Developers of the Fontainebleau Las Vegas casino-resort filed a $3 billion lawsuit against 11 lenders late Thursday, alleging they reneged on their promise to provide about $800 million in prearranged financing for the 3,800-room project on the Las Vegas Strip.
The complaint filed in Clark County District Court alleges that the lenders, including Bank of America and JPMorgan Chase, notified Fontainebleau developers on April 20 that they had “terminated” their agreement to provide an $800 million revolver loan due to one or more unspecified “events of default” by Fontainebleau.
But the developers say they haven’t defaulted on any part of their agreement.
“Without these funds — which cannot be replaced in today’s economic environment — the project cannot be finished and will never open,” Fontainebleau attorney Steve Morris wrote in the complaint. “Construction will cease, contractor liens will accrue and revenues from the project will never be realized.”
Telephone calls to spokesmen for Bank of America and JPMorgan Chase did not immediately return phone calls Thursday night.
The lawsuit notes that lenders charged in the lawsuit collectively received tens of billions of dollars in federal bailout money that was meant to increase the flow of credit.
“This case arises from the breach by a group of unscrupulous banks of their clear and unequivocal written promise to Fontainebleau to finance the construction of its multibillion-dollar casino-resort development project in Las Vegas — a promise in exchange for which the banks have already secured for themselves tens of millions of dollars in fees,” the complaint said.
The $800 million loan was in addition to more than $2 billion in debt and equity that Fontainebleau Las Vegas had already borrowed to build the resort.
Spokesmen for Fontainebleau said work was nearly 70 percent done on the 24-acre, 63-story project, with casino officials eyeing an October opening for the $3 billion resort.
Fontainebleau’s owners said in the lawsuit that about 3,300 construction workers are currently onsite daily, and the resort’s opening is “expected to result in over 6,000 full-time jobs at the facility, and approximately 2,000 additional jobs in Las Vegas.”
Also named in the suit are Merrill Lynch Capital Corp., Barclays Bank PLC, Deutsche Bank Trust Company Americas, Royal Bank of Scotland PLC, Sumitomo Mitsui Banking Corporation New York, Bank of Scotland, HSH Nordbank AG, Camulos Master Fund LP and MB Financial Bank, N.A.
Fontainebleau Las Vegas is represented by Kasowitz, Benson, Torres & Friedman LLP of New York, and Morris Peterson of Las Vegas, Nevada.
The company said neither the lawsuit nor the $800 million loan affect its Fontainebleau Miami Beach property.
