Lake Las Vegas creditor asks court to dismiss bankruptcy case

By Jennifer Lanning Drey

Portland, Ore., Aug. 20 - Lake at Las Vegas Joint Venture, LLC creditor Transcontinental Properties, Inc. asked the U.S. Bankruptcy Court for the District of Nevada to dismiss the company's Chapter 11 bankruptcy case, according to a Thursday filing.

Transcontinental said the case should be dismissed due to lack of good faith and because the company has no reasonable likelihood of rehabilitation.

More specifically, the creditor said cause exists to dismiss the case under bankruptcy law because Lake Las Vegas only has one asset and one primary secured creditor, Credit Suisse.

Unsecured creditors hold roughly $15 million of claims against the company, which are dwarfed by the $600 million owed to Credit Suisse, Transcontinental said.

Transcontinental claimed Credit Suisse had effective control over the company's assets and affairs for seven months prior to the filing and could have foreclosed and continued to operate the assets directly.

"The exact reason for the lender's attempt to conduct the charade of these Chapter 11 cases, and what the lender originally sought to gain, remains a mystery, but in all events appears to be devoid of any legitimacy," Transcontinental said.

A hearing is scheduled for Oct. 2.

Lake at Las Vegas Joint Venture LLC, a 3,592-acre master-planned residential and resort community, filed for bankruptcy on July 17, 2008. Its Chapter 11 case number is 08-17814.

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