Morris and bank company Drexel Burnham Lambert began a search in 1989 for a new owner to take over the Landmark. At the end of the year, a U.S. bankruptcy court judge gave Morris until 1990 to find a buyer or refinancing. Otherwise, the Landmark would be liquidated to pay off creditors, in accordance with a court order. On January 2, 1990, the Landmark was ordered into Chapter 7 bankruptcy after a judge ruled that the creditors would not be able to receive compensation under the reorganization plan. Between $43 million and $46 million was owed to various creditors. Morris' gaming license expired that month after the resort failed to pay $500,000 in taxes and penalties. Richard Davis, a Las Vegas-based real estate agent, was appointed by the bankruptcy court that month to temporarily operate the resort. On February 21, 1990, the Nevada Gaming Commission extended the gaming license and allowed the resort to stay open for at least two additional weeks while its financial problems were analyzed by state experts. At that time, the hotel had $562,000 in cash, including $175,000 in revenue that had accumulated in the prior six weeks.