Hotel-casino sues Las Vegas Grand Prix, Clark County over alleged losses from construction, closures

LAS VEGAS, Nev. (FOX5) - A Las Vegas Strip-adjacent hotel-casino sued the Las Vegas Grand Prix and Clark County over millions of dollars in alleged business losses and expenses caused by construction and road closures for the 2023 inaugural race.

Ellis Island, which is located near Koval Lane and Flamingo Road on the circuit, filed a lawsuit April 30 against race organizers and Clark County. The suit claims ongoing traffic issues significantly impacted customers, vendors and overall operations of the hotel and casino, and the property spent “hundreds of thousands of dollars to employ their own flaggers” to mitigate traffic issues.

Spokesperson Lisa Mayo-DeRiso, who represents a group of businesses at the intersection of Koval and Flamingo, told FOX5 that Ellis Island reported losses of $4 million. Last summer, Ellis Island partnered with the race for grandstands at “Turn 4,” offering hotel packages and even a beer garden experience. FOX5 could not confirm the cost of upfront expenses required of participating businesses.

Documents allege that race organizers failed to communicate the extent of forthcoming closures impacting the property and promised county leaders that customers would not lose access.

“[The project manager] represented that ‘[t]he entrances/exits for Ellis Island will not be impacted during construction.’ This representation turned out to be false,” the lawsuit said, referencing an email from September from race officials.

“F1′s announced construction schedule, inclusive of paving and constructing the [temporary] Flamingo Bridge, would continue to fluctuate with no advance notice to Plaintiffs, with each construction event impeding and interfering with Plaintiffs’ customers’ ingress and egress, as well as the ingress and egress of Plaintiffs’ vendors and other third-parties it conducts business with, which caused disruption to those contracts and Plaintiffs’ business and business dealings,” the suit states.

“Between June and September 2023, F1 and its agents inconsistently timed their road paving schedules, leading to road closures on a daily basis with no notice to Plaintiffs. Plaintiffs were forced to pay for road flaggers to work between 12 and 14 hours a day to minimize (if not prevent) the resulting traffic build-up from blocking entrances to Ellis Island,” the suit states.

The lawsuit alleges that Clark County granted the race a “conditional use” permit to avoid some of the requirements of a “special use” permit, like a public hearing, greater notification of surrounding property owners and more rigorous approval standards. It also states that the property has “apparently entered into contractual agreements to continue to do so for up to an additional nine (9) years into the future.”

“Clark County has appropriated said property for the exclusive benefit of F1. Clark County’s taking of Plaintiffs’ property constitutes a taking by inverse condemnation, which requires full and just compensation under Article 1, Section 8 of the Nevada Constitution,” the suit reads.

Officials with the Las Vegas Grand Prix and with Clark County said they cannot comment on pending litigation.

Attorneys representing Ellis Island told FOX5 on Tuesday, “Ellis Island’s damages to date are already in the millions of dollars. And as you know, F1 is planning on holding its race every year for the next 9 years which will continue to cause Ellis Island significant economic losses in the future.”

FOX5 filed a public records request for the race’s 2024 traffic plan, which was filed to Clark County on May 1. Clark County has declined to release the plan, saying that it is a “working draft” that needs to be reviewed by officials.

In late April, F1 LVGP CEO Renee Wilm promised FOX5 viewers and the Las Vegas Valley a significantly different approach to year two of the race.

“Year one was tough in so many ways and we want to create an incredible race and incredible fan experience, but also be a better member of this community. Good communication. Good community engagement. And we’re really excited about what we have coming forward this year,” Wilm said.

“We are not doing what we did last year. It was a nine-month long beatdown, and for that we will be eternally grateful to the city of Las Vegas for tolerating us. This year, significantly less construction. We will start installing barriers and lighting fixtures. It will be done on a rolling basis, but it won’t be till much late this year-- really until sometime in September, October. So we are going to continue to be vibrant, helpful part of this community and not cause so much disruption,” she said.

Economic analysts for F1 predicted an infusion of more than $1.2 billion in economic revenue for the inaugural race.

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