GAMING CONTROL BOARD:

Regulators question Jimmy Buffett about drug scrapes, endorse licensing request

Singer Jimmy Buffett, laughs as Michael Utley (not pictured), keyboardist for the Coral Reefer Band, answers questions during a Gaming Control Board hearing at the Sawyer State Building Wednesday, March 7, 2012. With Buffett are attorney Jeffrey Smith and John Cohlan of Margaritaville Holdings.

Jimmy Buffett Seeks Gaming License

Singer Jimmy Buffett, center, prepares for a Gaming Control Board hearing at the Sawyer State Building Wednesday, March 7, 2012. With Buffett are attorney Jeffrey Smith, left, and John Cohlan of Margaritaville Holdings. Launch slideshow »

As any Parrothead knows, Jimmy Buffett’s songs are filled with entertaining stories presented in poetry and a Caribbean beat.

On Wednesday, the entertainer — applying as James W. Buffett — shared a few more stories, minus the music, en route to being unanimously recommended for licensing so that he can share gaming revenue with Caesars Entertainment at his Margaritaville Casino and Restaurant at the Flamingo.

The state Gaming Control Board questioned Buffett for about 15 minutes and approved its recommendation in less than an hour. The matter will be considered for final approval by the Nevada Gaming Commission on March 22.

The board questioned Buffett about two scrapes he had with the law involving drug incidents. A Jamaican SWAT team shot at his airplane, which was mistakenly thought to be smuggling drugs, in 1996. And, in 2006, Buffett was detained by French customs officials after he was believed to be carrying Ecstasy.

Buffett told regulators that in both cases, it was determined that authorities were mistaken and the matters were quickly resolved. In the 2006 incident, Buffett paid a fine to avoid further complications with authorities.

In an interview after the hearing, Buffett said Control Board agents were satisfied with his explanation.

During the hearing, at which Buffett and his associates told several stories about his successes with the Margaritaville brand. He said he became interested in the restaurant business when his friend, superstar chef Emeril Lagasse, told him that his best nights at his MGM Grand restaurant occurred when Buffett was performing at the MGM Grand Garden Arena.

Buffett said he approached MGM about opening a restaurant, but the company went with an Irish pub concept instead. That led Buffett to inquire with Harrah‚s Entertainment, now Caesars Entertainment, and the Margaritaville restaurant was born.

“I occasionally wonder about the guy (at MGM) who made that decision and where he‚s working now,” Buffett said.

The Margaritaville restaurant opened at the Flamingo in 2003 and the casino was added in 2011.

The board also questioned two corporate officers, Donna Kay Smith, a friend and business associate of Buffett’s, and Michael Utley, who has been with Buffett’s Coral Reefer Band for 40 years and is referenced in Buffett’s song “Volcano.” Smith opened a T-shirt company in Florida that first exploited the Margaritaville brand. Buffett said it was that experience that enlightened him about the importance of branding and intellectual property law and led him to get patents and trademarks for the Margaritaville name.

“Margaritaville” is Buffett’s most popular song and was released in 1977. Since then, Buffett has developed a large following of fans known as Parrotheads, a term referring to the singer’s tropics-flavored lyrics and beats.

If licensed by the state, Buffett would be able to share gaming revenue with his landlord and casino managers at the Flamingo. The Margaritaville Casino and Restaurant, which Buffett frequents when in Las Vegas, has 220 slot machines and 22 table games. Details of the proposed revenue sharing between Buffett and Caesars were not disclosed.

In an interview after the hearing, Buffett said he attended the hearing between California concert dates. He usually performs two shows a year in October in Las Vegas.

Buffett said he was looking to put together similar gaming deals in Louisiana, where he built a restaurant during a post-Hurricane Katrina renewal, and his native Mississippi. Regulators also asked him whether he would consider developing a property at Lake Tahoe. Buffett said he was fond of Lake Tahoe because it was where he got his start in Nevada and that he would be open to exploring opportunities there.

Control Board Chairman Mark Liparelli said that while the conversation was light at Wednesday’s hearing, Buffett’s application received the same scrutiny that all license investigations get. Buffett affirmed that agents carefully scrutinized his record and that he conducted interviews between concert dates.

In other business, the Control Board recommended approval of the licensing of Michael Gaughan to operate a race and sports book for Hotspur Resorts and Herbst Gaming at the Rampart Casino at the Resort at Summerlin.

The board also delayed a hearing on the parent company of the Cosmopolitan of Las Vegas, which is attempting to deregister as a publicly traded corporation.

In separate votes, the board also recommended licensing Navegante Gaming to operate the bankrupt Hooters Casino Hotel and recommended approval of a nonrestricted gaming license for slot machines only for a Dotty's casino site on South Boulder Highway.

Navegante, managed by Larry Woolf, is frequently licensed to manage distressed properties until new buyers or managers can be licensed. The company plans to rehire casino workers at the property until a deal is closed with Canpartners Realty Holding Company IV, a subsidiary of Canyon Capital Realty Advisors, which is acquiring the property in a $60 million credit deal.

Richard Bosworth, managing director of Canyon Capital, said the property would retain the Hooters name in the short term, but he is contacting representatives of major hotel chains to take over the property and rebrand it.

Nevada Restaurant Services acquired a property at 754 S. Boulder Highway and will convert it to a Dotty's with no more than 50 slot machines. Regulators said the property is similar to other Dotty‚s properties in the chain.

The board also delayed a hearing on the parent company of the Cosmopolitan of Las Vegas, which is attempting to deregister as a publicly traded corporation.

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