Trouble in the Valley of the Dolls

The IRS called her clients “hookers and pimps.” Karen Dennison knew better.

Published in 2007 Mountain States Super Lawyers — July 2007

In northern Nevada in the 1960s, no brothel owner had earned more notoriety than Joe Conforte. His bevy of brothels in and around Reno were trailer-sized in their illegal days—big enough to house his customers but small enough to tow over county lines whenever an informant tipped him to an upcoming sheriff raid. Mustang Ranch, a few miles east of Reno near Storey County, became Nevada’s first licensed brothel in 1971, paving the way for legalized prostitution in 12 of the state’s 17 counties.

But Conforte didn’t just use the land for prostitution. He also established rock-bottom low rent for 90 mobile homeowners in a place called the Lockwood Mobile Home Park. When Conforte fled the country and more than $13 million in back taxes, the IRS seized the brothels. It also took over Lockwood.

One IRS agent famously dismissed the trailer park as “nothing but a bunch of hookers and pimps.” That worried the Lockwood residents, who were elderly and on fixed incomes. They were afraid that the feds were planning to evict them and sell the property.

Enter real estate lawyer Karen Dennison. A Reno native and 1971 graduate of the University of San Francisco School of Law, Dennison is a shareholder in Hale Lane Peek Dennison and Howard, a firm that had four lawyers when she started and now employs approximately 50 in Reno, Carson City and Las Vegas. Chairperson of the firm’s real property and finance practice group, Dennison has more than 35 years of experience in real estate sales and acquisitions, development, leasing and financing.

Dennison took on the Lockwood residents’ case pro bono.

“We had an opportunity to more or less save these people’s homes,” Dennison says. “And the [renters] worked very, very hard.”

Dennison was beside them the whole way. Ernest Nielsen, who was the director of Washoe Legal Services and is now an attorney for the Washoe County Senior Law Project, was working with Lockwood residents to find a way to incorporate and purchase the park from the IRS when he asked Dennison for help. She devoted 200 hours to the project. “It was a huge effort and she was the real key,” Nielsen says. “She was so giving of her time. She’s a great credit to the discipline and to the legal profession.”

By the end of 2002, the IRS accepted an offer from residents to purchase the park. Lockwood residents would pay $192,770 for their property and form the Lockwood Community Corp., which maintains the property and collects rent. The IRS also agreed to accept the rent collected from the previous three years as partial payment for the property. Today, she says, the residents run the park.

“I think it was just sheer tenacity,” Dennison says. “[The residents] said, ‘We’re not going to give up; we’re going to keep our homes.’ And that’s what they did.”

“It would have looked really bad [for the IRS] to evict all these people from their homes,” she says. “And it could have happened.”

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