Though the old Castaways hotel-casino was imploded more than three years ago, the dust has not yet settled from a lawsuit involving employees of the property. The ramifications could affect companies long into the future.

The 9th U.S. Circuit Court of Appeals ruled that three former Castaways workers have the right, under federal labor statutes, to sue their former managers for unpaid wages, even though the company was already liquidated under Chapter 7 bankruptcy.

The court is allowing the former workers, Thelma Boucher, Ardith Ballard and Joseph Kennedy III, to pursue their wage lawsuit against three former Castaways managers and executives under the Fair Labor Standards Act.

 The appeal court's decision has surprised many local law watchers because managers have been generally shielded from wage claims.

"The mere fact that the employer is in bankruptcy and that doesn't protect the individual (manager) ... this is precedent-setting in this (9th) Circuit," said Ann McGinley, an employment law professor at the University of Nevada, Las Vegas Boyd School of Law.
 

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