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Chris Jones

Las Vegas Convention And Visitors Authority: Fee To Defend $1 Deal: $118,000

7 September 2005

How much does it cost to fix a $1 deal gone bad?

In the case of the Las Vegas Convention and Visitors Authority, nearly $118,000 and counting.

That's how much the agency tasked with bringing more visitors to Southern Nevada is on the hook to pay a San Francisco law firm for its first month's work sorting through the remnants of last fall's controversial sale of the "What happens here, stays here" trademark.

And until a continuing trademark infringement case against a California woman is settled, that bill -- which was $117,692.11 through July 31, to be exact -- will likely continue to grow.

"(It's) brutal. Who did we kill?" Las Vegas Mayor and authority board member Oscar Goodman joked early Tuesday afternoon, adding the cost was akin to what he once charged clients in his days as a high-profile defense attorney.

The authority came under scrutiny in late June when it was revealed that Rossi Ralenkotter, its president and chief executive officer, in November 2004 sold the trademarks for the popular slogan, as well as the lesser-known "We work as hard as we play" tag line, for $1 to Las Vegas-based R&R Partners, a contracted advertising agency that created both campaigns nearly three years ago.

While some cried foul, Ralenkotter and R&R boss Billy Vassiliadis said the sale was a legal maneuver to assist in their organizations' shared legal interests in a trademark infringement case against Dorothy Tovar, a California woman who sells products that say "What happens in Vegas, stays in Vegas."

A team of San Francisco-based attorneys with Morrison & Foerster, an international law firm, was hired June 30 to assist the authority in its ongoing case against Tovar, as well as review the $1 sale and future board policies.

The firm on Aug. 9 cleared Ralenkotter, Vassiliadis and their staffs of any purposeful wrongdoing related to the $1 sale, but it also called for several changes to prevent similar perceived conflicts from recurring.

A four-man special committee formally kicked off the process of enacting new management policies on Tuesday.

Potential changes include requiring the authority president to get an OK from its 14-member board before he or she sells or transfers ownership of any intellectual property; maintaining authority ownership of all trademarks or service marks it uses; and requiring the president to notify the board before entering into any of several types of transactions worth more than $50,000.

The committee's recommendations will be discussed when the full board convenes Sept. 13. A second special committee meeting is scheduled for early October, with final changes in board policy to be ratified by the full board on Oct. 11.

The Tovar case is awaiting an Oct. 17 pretrial conference before Reno-based U.S. District Court Judge Larry Hicks.

Morrison & Foerster's total bill won't be known until that case is settled.

The authority initially refused the Review-Journal's request to examine Morrison & Foerster's bills, including a denial by legal counsel Luke Puschnig immediately following Tuesday's meeting.

Puschnig soon relented and disclosed the amount, but efforts to reach Goodman for additional comment on behalf of the authority were unsuccessful late Tuesday afternoon.

Vassiliadis also could not be reached late Tuesday, but last month he told the Review-Journal he wished the matter never reached a point where outside lawyers were needed to clear his and Ralenkotter's respective reputations.

"I've got people saying, 'Congratulations,' to me today, but it's hard for me to be euphoric," Vassiliadis said. "I hate to think that we had to hire a firm out of California, spending a whole lot of money, to get someone to say I'm an honest guy who didn't try to steal any money."