Kurt Gratzer testified that Rick Tabish, his friend from childhood, asked for assistance to kill Ted Binion.(Court TV)

By Laura Barandes
Court TV

A childhood friend of Rick Tabish testified Tuesday that the struggling Montana businessman approached him to kill Las Vegas millionaire Ted Binion.

Read the Arrest Report of Kurt Gratzer

Kurt Gratzer told the court that Tabish wanted the casino mogul's money and girlfriend, co-defendant Sandra Murphy. Tabish offered him $100,000 to murder Binion, said Gratzer, who has been granted immunity in exchange for his testimony. Prosecutors also presented several witnesses from Montana who said Gratzer told them about his alleged discussions with Tabish.

In Sept. 1998, a month after Gratzer said he was approached by Tabish with a "special mission," Binion was found dead. Prosecutors allege Tabish and Murphy killed him and then staged the murder to look like he had overdosed on heroin and the anti-anxiety drug Xanax.

Gratzer testified that a staged overdose was one of the murder scenarios he and Tabish discussed. Others included killing Binion with one of his own weapons, shooting him through a window of his Pahrump ranch house, and an odd plan to attack Binion after jumping from a helicopter.

Prosecutors focused on the overdose scenario, which Gratzer said consisted of "getting this man [Binion] to consume a lethal amount of heroin...Xanax...and another anti-anxiety drug."

Palazzo: Is this all like a dream to you? Gratzer: More like a nightmare. Palazzo: It's a nightmare for all of us, believe me.

Gratzer said he went so far as to call a pharmacist in Montana, a friend of his, to ask what would constitute a lethal dose of the drugs.

"I think I mentioned shoving it down his throat with a stick...I was just using my imagination," he said.

The payoff for the murder was to come from silver and a life insurance policy Tabish planned to steal from Binion, Gratzer said.

Gratzer said he ultimately did not go through with the plan and learned of Binion's death from a newspaper. He saw Tabish in Montana in Oct. 1998 and said, "You crazy f***er, you actually did it, didn't you?"

The defense tried to undermine Gratzer's credibility by portraying him as mentally unstable. Under questioning from Tabish's attorney Louis Palazzo, Gratzer admitted that he was taking the anti-depressant Welbutrin "one in the morning and one at night, if I remember."

Palazzo also questioned Gratzer about the circumstances of his discharge from the Army. At one point, Gratzer admitted that he got drunk several times while in the service.

"I went out with some people in Seattle," said Gratzer. "I drank beer all night with the lead singer of Soundgarden and the bass guitarist from Nirvana."

Palazzo also pressed Gratzer on his five DUI convictions, getting him to acknowledge that he was unable to get a job because of these marks on his record.

In addition to Gratzer and his associates from Montana, several other state witnesses took the stand Tuesday. Binion business associate Jerry Keener told the jury that during an August 1998 telephone call, Murphy told him she was concerned about Binion's heroin use and her own financial situation in the relationship.

Rick Tabish's father leaves the courthouse after hearing damaging testimony against his son. (Court TV)

"She said something to the effect of Ted is doing it again," said Keener, an Oregon jeweler. When he asked Murphy to explain, he testified, she said, "Heroin, and he's killing himself."

According to Keener, Murphy went on to say, "I'm getting a million dollars and that's not enough."

Keener, who described Binion as a "big brother" to him, said he was "taken aback" and "saddened" by the drug use Murphy was describing. Of Murphy's financial concern, he said, "The impression I got was that she was going to feel like she was stranded."

In addition, prosecutors used testimony from a former employee at the Peninsula Hotel in Beverly Hills to show that Tabish and Murphy spent the weekend before Binion's death together in a hotel suite. The defense has already conceded that the two had a romantic relationship behind the back of Tabish's wife and Murphy's boyfriend, Binion.

The prosecution also introduced documents into evidence showing Tabish's dire financial situation, a possible motive for killing Binion.

Testimony will continue Wednesday.