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Cy Ryan

Court Hears Arguments in Mikohn Employment Lawsuit

22 October 2004

CARSON CITY -- Attorney Charles McCrea Jr. wants his day in court to press his claim that he is owed more than $1.4 million from Mikohn Gaming Corp., which fired him last year.

But Mikohn, which distributes gaming equipment worldwide, says the issues should be decided in arbitration, not in a district court suit in Las Vegas.

The Nevada Supreme Court heard arguments Wednesday whether to uphold the ruling of District Judge Kathy Hardcastle, who decided that the majority of the issues should be heard in district court and not before an arbitrator.

McCrea was general counsel for Mikohn, being hired in 1994 and being terminated in 2003.

Patrick Hicks, attorney for Mikohn, told the court that the original contract with McCrea called for arbitration on employment issues.

Hicks argued that McCrea enforced the arbitration clause against other employees and now he wants to avoid it. He said it would be the "ultimate injustice" now to allow McCrea to pursue his claims in court rather than in arbitration.

"This is an end run to avoid arbitration," Hicks told the court.

But Donald Campbell, attorney for McCrea, said a clause in the agreement stated that the company must defend McCrea and protect him from personal liability and against all losses from any investigation.

"There is nothing under the agreement to require arbitration" in this category, Campbell said.

Campbell said the company was seeking to renew its gaming license in Michigan and part of that investigation focused on McCrea. "They (Mikohn) threw him overboard and invited the sharks to eat him."

Mikohn first filed suit, claiming McCrea owed the company $113,000 he borrowed to buy stock. McCrea filed a countersuit, saying he lost severance benefits of $1.4 million, $67,000 in bonus pay, and loss of stock options for 246,000 shares.

The Supreme Court took the arguments under submission and will rule later.