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New Subcontractors Join Legal Fight Over MGM's Harmon Towers Demolition Plan

By Steve Green, Las Vegas SunMcClatchy-Tribune Regional News

Nov. 29, 2011--Two subcontractors have joined the general contractor in fighting plans by MGM Resorts International to implode the unused Harmon Tower at CityCenter on the Las Vegas Strip.

The CityCenter casino-resort complex, half owned and managed by MGM Resorts International, says the 26-story hotel structure is unsafe because of construction defects and needs to come down.

It's seeking approval to implode the tower from Clark County and in a Clark County District Court lawsuit.

The lawsuit is over the defects and money CityCenter has refused to pay Perini and certain subcontractors for what it calls flawed work on the $279 million building.

The structure, where work was halted in early 2010, had been planned for 47 floors but was capped at 26 when the defects were discovered.

The general contractor, Perini Building Co., insists the structure is safe and the defects can be repaired. It's been leading the charge against the implosion plan, charging MGM Resorts wants to get rid of the building not because of defects but because of its own design errors and because the Harmon is unneeded with the current glut of hotel rooms in the city.

And now two subcontractors have joined Perini in fighting the demolition plan.

Their attorneys filed briefs last week with District Judge Elizabeth Gonzalez, who plans a hearing next month on the demolition proposal.

A team of five attorneys representing Pacific Coast Steel filed one of the briefs.

Pacific Coast Steel has plenty at stake in the litigation.

On the one hand, it's accused of failing to properly construct "link beams" at the Harmon, allegedly resulting in a "substantial and dangerous reduction in the vertical load-bearing capabilities" of the building.

On the other hand, it has filed liens against the Harmon for $8.4 million and is complaining implosion of the building would destroy its collateral for those liens.

Pacific Coast Steel attorneys complained in their brief that destruction of the Harmon would give CityCenter an "insurmountable advantage" against Perini, Pacific Coast Steel and other subcontractors in an upcoming trial on the alleged defects.

"The physical absence of the Harmon caused by its demolition is enough to permanently prejudice Perini, Pacific Coast Steel and the other subcontractors and guarantee a verdict in CityCenter's favor nearly a year and a half before the first juror is sworn in by the court," their filing said.

"Demolition will create an unrebuttable presumption in favor of CityCenter on the two ultimate issues in the case -- whether the Harmon was defectively constructed and whether the building can be repaired rather than demolished," the Pacific Coast Steel filing said. "The jury's decision on both of these issues will be effectively taken out of their hands if the building is allowed to be torn down."

"If CityCenter's motion is granted, and the Harmon is demolished, the parties will be arguing about the safety and integrity of a building that no longer exists," Pacific Coast Steel attorneys wrote in their brief. "It will be impossible for a juror to reconcile this issue with the inherent presumption that there had to be something very seriously wrong with the building if it was demolished. A jury will undoubtedly believe that governmental and judicial authorization was needed for a total implosion."

The Pacific Coast Steel filing also complained that despite assertions to the contrary by CityCenter, "there is no evidence that the Harmon is a public safety risk which must be abated."

Also filing a brief opposing the demolition plan were four attorneys for Ceco Concrete Construction LLC, which has filed a lien against the Harmon for nearly $1.56 million.

That company complained that CityCenter's actions don't support its claim that the building is dangerous and should be imploded.

Ceco attorneys noted that after announcing plans to seek Clark County approval to implode the building on Aug. 15, "inflaming headlines around the world," CityCenter didn't ask the Nevada Supreme Court for an emergency order allowing it to abate the public safety risk. (The lawsuit was stayed at that time so the Supreme Court could decide a side issue).

"Instead, CityCenter sat silently for approximately four months, waiting for the stay to be lifted," Ceco complained in its brief. "That is not the behavior of a public company that truly believes it possesses a building on the Las Vegas Strip that could collapse."

Ceco's attorneys said CityCenter's engineer who predicted the Harmon could collapse in an earthquake has yet to provide documentation to Clark County and the county "seems to have more questions than answers" about whether to allow demolition to go forward.

"It is true as a general principle that owners can do what they want with their property," Ceco's filing said. "Of course, as any parent would tell a 5-year-old boy in a toy store, before you break it, you have to pay for it, and CityCenter is far from accomplishing that where the Harmon is concerned."

CityCenter attorneys have not yet responded to these briefs.

But they're likely to remind Gonzalez they've filed a list of more than 1,700 defects involving the Harmon's reinforcing steel and that plenty of evidence about the defects has been and will be documented prior to the implosion.

They'll likely note that Clark County has ordered CityCenter to abate the public safety risk posed by the Harmon, which CityCenter's consulting engineer has concluded "is likely to collapse in a code-level earthquake."

"CityCenter proposed to demolish the Harmon as the fastest, surest and most cost-efficient means of abating the public safety risk," the company's attorney said in a court filing earlier this month.


(c)2011 the Las Vegas Sun (Las Vegas, Nev.)

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