|By Steve Green, Las Vegas
SunMcClatchy-Tribune Regional News
July 15, 2011--The Las Vegas Hard Rock Hotel has closed its Rare 120 steakhouse -- and now it's being sued over that decision.
The Dolce Group of Los Angeles, which says it developed and marketed the restaurant, filed suit Thursday in Clark County District Court charging the Hard Rock wrongfully terminated its contract to share revenue from the business -- and then closed it on Monday.
A request for comment was placed with the Hard Rock. In its online restaurant listings, the property says, "Prepare for an exciting new steakhouse concept coming soon to Hard Rock Hotel & Casino."
Thursday's lawsuit says the upscale restaurant opened on April 15, 2009, and for its first year it "was a huge success among locals and destination travelers, earning approximately $4.7 million in total food and beverage sales."
But mismanagement and cost-cutting ordered by the Hard Rock, which operated the restaurant, later caused sales to decline, the suit charges.
The lawsuit alleges Joseph Magliarditi, who ran the Hard Rock as president and CEO while it was controlled by international financial giant Credit Suisse AG, was responsible for many of these cuts including limiting the restaurant's hours of operation, serving lower-quality meat, reducing the wine selection and decreasing the number of servers and cocktail waitresses, causing guests to complain about the service.
The suit alleges that over several months, the Hard Rock appointed five food and beverage managers to run Rare 120 and other bars and restaurants, "all of whom were incompetent, rarely visited the restaurant, had little interaction with employees and caused sales to drop dramatically."
Thursday's suit was filed against the Hard Rock's current owners including Brookfield Asset Management Inc.
Dolce's contract to share revenue was canceled in June after the restaurant failed to hit a threshold of $4 million in sales during the preceding 12 months, the lawsuit says.
"Defendants wrongfully blamed the Dolce Group for failure to meet the $4 million threshold," the lawsuit says. "The new owners and operators ratified the prior mismanagement of Mr. Magliarditi and others from (the Hard Rock) and its affiliates in order to avoid continuing to pay" fees to Dolce.
The suit says Dolce Group also developed the Johnny Smalls restaurant at the Hard Rock on Paradise Road. That restaurant remains open.
Dolce Group is represented in the lawsuit by the Las Vegas law firm Bailey Kennedy.
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