Aladdin Hotel Corporation, and Josephine Alexander D/B/A Hairem Beauty and Barber Shop, Plaintiffs- Intervenors v. Nevada Gaming Commission

637 F.2d 582 ALADDIN HOTEL CORPORATION et al., Plaintiffs-Appellees, and Josephine Alexander d/b/a Hairem Beauty and Barber Shop et al., Plaintiffs- Intervenors, v. NEVADA GAMING COMMISSION et al., Defendants-Appellants. No. 79-3497. United States Court of Appeals, Ninth Circuit. June 5, 1980. Richard H. Bryan, Atty. Gen., Carson City, Nev., argued, for defendants-appellants; Nancy S. Roberts, San Francisco, Cal., and Raymond D. Pike, Edward R. Kane, Las Vegas, Nev., on brief. Richard Wright, Stanford J. Rosen, Rosen, Remcho, Henderson, San Francisco, Cal., argued, for plaintiffs-appellees; Dennis M. Sabbath, Las Vegas, Nev., on brief. Appeal from the United States District Court for the District of Nevada. Before TANG, SCHROEDER and POOLE, Circuit Judges. SCHROEDER, Circuit Judge: 1 This is an appeal from a preliminary injunction entered by the Nevada district court barring revocation of the Aladdin Hotel Corporation's gaming license by the Nevada Gaming Commission in order to permit the owners of the casino a reasonable time to find a purchaser for the hotel. We reverse the district court's order for lack of federal jurisdiction. 2 In March, 1979, the Nevada Gaming Control Board…

This is an appeal from a preliminary injunction entered by the Nevada district court barring revocation of the Aladdin Hotel Corporation’s gaming license by the Nevada Gaming Commission in order to permit the owners of the casino a reasonable time to find a purchaser for the hotel. We reverse the district court’s order for lack of federal jurisdiction.

In March, 1979, the Nevada Gaming Control Board initiated efforts to revoke the Aladdin’s gaming license following the Corporation’s conviction of federal felony offenses. Pursuant to Nev.Rev.Stat. § 463.-312(9), the Commission entered an emergency order which suspended Aladdin’s gaming license but permitted continued gaming upon certain conditions pending action on a formal administrative complaint seeking revocation.

On June 11, 1979, the Aladdin and Holding Corporation of America (HCA) executed an agreement calling for sale of the casino and resort to HCA. On June 14, 1979, the date set for hearing on the administrative complaint, the Aladdin and the Gaming Control Board entered into an agreement, accepted by the Commission, to the effect that the Aladdin would forego procedural rights accorded a gaming licensee by Nevada…

concurring in part and dissenting in part:

I concur in reversing the preliminary injunction orders of the district court, but respectfully dissent from the majority’s conclusion that the action should be dismissed for lack of jurisdiction.

I believe the district court acquired and retained jurisdiction to consider appellees’ claims. Their complaint made some showing that after voluntarily surrendering their plenary rights to a full-dress revocation proceeding, they still retained some due process right entitled to federal protection. That right was to have, before termination, a meaningful hearing preceded by reasonable notice, at which would be considered the questions whether by reason of the collapse of the HCA negotiations, and the appearance of unspecified “problems” with the potential second purchaser, the terms of the stipulation and order had been “violated” so as to call for termination instan ter; or, in the Commission’s own discretion, for some further consideration. If this analysis is correct, then the district court would have had jurisdiction to grant relief which would have required the Commission to give what was due from that arm of the state.

The district…