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Best of Howard Stutz

Gaming Guru

Howard Stutz
 

Nevadan at Work: Transplant didn't want to leave Las Vegas

23 July 2012

David Arrajj literally received his latest job offer during his going away party.

In 2000, Arrajj was corporate counsel for Park Place Entertainment, which operated the Hilton Hotels' gaming properties, including the former Las Vegas Hilton and Bally's Las Vegas.

Company executives asked Arrajj to transfer back to back to Atlantic City. At the time, the company was negotiating to acquire Caesars World and was increasing its presence on the Boardwalk.

Arrajj wasn't thrilled about the move.

He had spent the first 27 years of his legal career in New Jersey.

"My wife and I talked ourselves into the idea that it was a good thing to go back to the East Coast," Arrajj said. "We could be closer to relatives and all that stuff."

His house was already up for sale, his bags were packed and Park Place officials threw Arrajj a going-away party. While talking with a partner in the firm of attorney Frank Schreck, who was at the event, Arrajj learned the Las Vegas firm was trying to replace a recently departed senior associate in its gaming division.

"I told him I might be interested in the position, and he said they were interested in having me," Arrajj said. "So I got lucky. I was in the right place at the right time. I've never looked back."

Not that the couple didn't make a move.

"My wife wanted a bigger kitchen, but that's another story," Arrajj said with a laugh.

Arrajj's legal and gaming career have included stints as both a prosecutor and public defender, private practice and jobs in both areas of New Jersey's gaming regulatory structure.

He was special counsel for licensing and director of the license division for the New Jersey Casino Control Commission, and a deputy attorney general for the New Jersey Division of Gaming Enforcement.

His badges from those jobs hang today in his 16th-floor office, which overlooks downtown, as does memorabilia of his hometown Boston Red Sox, Boston Bruins and New England Patriots.

Also hanging in the office are large black-and-white photos of two of Arrajj's favorite bosses, Joe Lordi, first chairman of New Jersey's Casino Control Commission, and Bud Read, the second commission chairman.

"I worked for them for a long time," Arrajj said. "Joe was called 'The Boss.'"

He moved to Las Vegas in 1995 for an opportunity to become general counsel at Bally's Las Vegas, which was owned by a company headed by the late Arthur Goldberg.

"If you want to be a gaming lawyer, Nevada is where you need to do it," Arrajj said.

Over the past 12 years, Arrajj has represented some of the top companies and principals within the gaming industry. Schreck's Las Vegas firm merged a few years ago with a large national firm out Denver and became Brownstein Hyatt Farber Schreck.

Arrajj, 64, focuses most on Nevada and works closely with Schreck, one of the industry's most respected gaming attorneys. During the gaming licensing process for the complicated $29 billion private equity buyout of Harrah's (now Caesars) Entertainment, Schreck worked on out-of-state jurisdictions while Arrajj handled Nevada licensing.

"There was quite a bit to do in Nevada," Arrajj said. "Nevada regulators do more work on cases like that than anywhere else."

Over the years, Arrajj's clients have included Caesars, Wynn Resorts, the Bank of Scotland, Tropicana Entertainment and financier Carl Icahn.

Question: What were some of your more high-profile cases in New Jersey?

Answer: When I was with the Division of Gaming Enforcement, we objected to the renewal of the license for the Atlantis, which was owned by the Elsinore Corp. (which also owned the Four Queens). We took their license away and the place was sold to [Donald] Trump. While I was in private practice, I represented a lot of Atlantic City casinos, such as Caesars, Showboat, Sands and Harrah's.

Question: What brought you to Las Vegas?

Answer: A good friend of mine told me than I can stay working for the government and make a nice living, get a steady income and have a nice pension, or, I could roll the dice and go out and try to make some money. I saw that Bally's was looking for a general counsel and I talked with Arthur. I handled his licensing. He said I would have to interview with the team in Las Vegas.

What's funny is that before I got here, Bally's had Pete Bernhard in the seat three days a week on loan from the Schreck firm. Pete kept all the balls in the air and doing what was need to get done before I arrived and he continued to help us out. Now, Pete is chairman of the Nevada Gaming Commission and he was my lawyer for a while.

Question: How big was the change was from gaming regulation to general counsel?

Answer: The first big transaction I worked on was putting the Paris construction deal together. I worked with outside firms on the design contracts, the construction management contract and the actual construction contract. I was right in the middle of it. I called a friend back in New Jersey after a few weeks and told him, "Hey, I can do this job."

Of course, I lived in the hotel for about six months until my wife could move out here. I had a room in the north tower and I must have gained 20 pounds eating in the restaurants. I would get up at 5 a.m., work out, and then be at my desk at 7. I'd still be there until 7 p.m. I had unlimited time to devote to the job, and that's what I needed to make the transition.

Question: What's the difference between being an outside counsel and an in-house lawyer?

Answer: I like that question. When you're an outside counsel, you can fire your clients. That's it. That's the difference. What I mean by that is that you are independent. Especially now in the age of online gaming and social gaming, sometimes clients don't like the advice you give them. We're very conservative in our advice. People in business don't always want to hear the worst news. We do our best to be creative and arrive at solutions to make everybody happy.

When you're in-house, it's a lot harder because you wear more than one hat. You're wearing the business hat and you're at the table when people sit down to talk about marketing and the strategic business plan. The objective is to make money, and that makes it little more difficult to give independent advice.