Could Gypsum Resources Lawsuit Financially Imperil Clark County?

In an ongoing and important case involving Clark County, several Democratic Clark County Commissioners and county employees, a final evidentiary hearing in Gypsum Resource LLC V. Clark County et al (see below), has been scheduled for tomorrow afternoon at the Clark County District Court House. Presiding over the case is Judge Joanna S. Kishner. County Attorney Rob Warhola is expected to be one of two witnesses to provide testimony.

Yesterday’s testimony was provided by Commissioners Marilyn Kirkpatrick and Jim Gibson, who each alleged they “didn’t remember” or “couldn’t recall” instances surrounding many specific events, and each of them admitted to not being “tech” savvy in relation to preserving text messages/electronic communications–communications required by law to preserve.

Last week, Commissioner Justin Jones gave similar testimony akin to selective amnesia. Jones told Judge Kushner he “had no recollection” of deleting text messages and had “no explanation” on how they were deleted.

According to one attendee at yesterday’s hearing, Kirkpatrick also admitted that she always had her phone set to “auto-delete” text messages and only recently removed the auto-delete feature in September 2023.

Kirkpatrick’s admittance is important.

In 2017 in Comstock V. Nevada, a ruling was issued that found electronic communications, including text messages, were part of the public record and must be preserved by law. The fact that Commissioner Kirkpatrick and other defendants were not aware or ignored the law was highlighted by Gypsum’s lawyers.

In 2019, a pivotal year prior to the 2020 election, Gypsum Resources notified the county that they were going to sue for breach of contract after the commission voted unanimously to deny Gypsum Resource’s request to waive a condition and proceed with their preliminary plan to develop 3,000 homes on private land adjacent to Red Rock Canyon, a national conservation area.

Through discovery, Gypsum attorney’s uncovered a political angle to this vote as well as destruction of public evidence and other crimes alleged in their case.

The Globe has extensively covered this case where a federal judge found that Commissioner (and Attorney) Justin Jones lied to the court, destroyed evidence and willfully acted in bad faith. The commissioners have yet to ask for Jones’ resignation, but he has since stepped down as Vice Chair of the Commission which oversees the largest county (and county budget) in the Silver State.

In a previous report by The Las Vegas Review Journal, Commissioner Justin Jones had not only been destroying evidence, but allegedly colluding with then-Clark County Commissioner, Democratic candidate for Governor Steve Sisolak to impede their development efforts.

At the time of Gypsum’s development agreement with Clark County, Attorney Jones had worked pro-bono for Save Red Rock (SRR) and used his position with SSR in his campaign for County Commissioner. Jone’s publicly vowed to oppose Gypsum’s development plans within his first 100 days of office.

Gypsum Resources’ lawyers reportedly obtained a text message thread between Jones and the former head of Nevada Conservation League Andy Maggi in October 2018, in which Jones said, “Well, I’m doing my part. If Sisolak doesn’t want to play, then it’s going to blow up in his face tomorrow.”

A court-ordered forensic audit of Jones’ cell phone and iCloud accounts found that all of Jones’s text messages leading up to the April 2019 vote on Gypsum’s development agreement were deleted and unrecoverable. The earliest messages on Jones’s phone were from roughly six hours after the commission voted unanimously to deny Gypsum Resource’s preliminary plan to develop thousands of homes.

Due to the actions of Justin Jones, Steve Sisolak, and other county officials and employees, Gypsum Resources was forced to file bankruptcy and is seeking restitution in excess of $2 billion in damages–an amount that would imperil the financial stability of Clark County whose 2024 budget is $5.1B.

Tomorrow Judge Kushner will issue her ruling which may include sanctions and allow the case to proceed to a jury trial scheduled for July 8, 2024.