Las Vegas Sands Sued for $5 Billion: Accused of Misappropriating Funds
HONG KONG — (Reuters) A former Macau business partner of Las Vegas Sands Corp. accused the casino operator of misappropriating trade secrets and is suing the company for at least $5 billion in profits that it says are owed via their joint ownership of copyright related to a casino license bid.
Asian American, headed by Taiwanese businessman Marshall Hao, filed the complaint in U.S. District Court in Nevada on Wednesday. The case is in addition to two separate, ongoing legal actions in Macau over an alleged breach of contract.
Las Vegas Sands, which is controled by billionaire Sheldon Adelson, and Asian American jointly submitted a bid for a gaming concession in 2002 in Macau, which has since become the world’s largest gambling market. But during the process, Las Vegas Sands switched partners, teaming up instead with Hong Kong group Galaxy Entertainment .
The Sands-Galaxy combination went on to win a license in the former Portuguese colony over a decade ago, beating contenders that included MP Entertainment Co. Limited, MGM-Grand Macau Limited, and Macau Star Limited, a subsidiary of Malaysia’s Genting Bhd.
Asian American alleges in its latest filing that after Las Vegas Sands terminated its joint venture, the company submitted a near-identical replica of its previous submission with new partner Galaxy.
“This is an action for money damages arising out of profits owed to plaintiff by LVSC for use and benefit of the work which ultimately led to the Las Vegas Sands enterprise securing a Macau concessions contract,” the company said in the complaint.
Las Vegas Sands, in a statement on Friday, denied the claims.
“Using a different lawyer every time, AAEC (Asian American) has repeatedly filed lawsuits trying to take credit for that which they didn’t do,” Las Vegas Sands said in the statement. “U.S. courts have consistently rejected those efforts. Las Vegas Sands will respond to this latest version of the same meritless lawsuit in court.”
The case is the latest in a string of court cases that involve Las Vegas Sands’ earlier dealings in Macau. Las Vegas Sands was ordered by a Clark County jury to pay more than $100 million to Hong Kong businessman Richard Suen last year, after he sued the company claiming it had failed to make good on a promise to pay him for helping it get permission to operate a Macau casino.
The case is on appeal to the Nevada Supreme Court.
Macau, on China’s southern coast, is the only part of the country where citizens are legally allowed to gamble in casinos. With $45 billion in revenue last year, seven times that of Las Vegas, it has proved a gold mine for operators.
Asian American argues that Las Vegas Sands’ record earnings were in large part due to its Macau resort and claims that Sands is guilty of disclosing information to Galaxy which was so sensitive that the parties “hired bodyguards” to protect the documents.
Details included the cost of the project, its impact on Macau, construction of a Venetian-style resort casino and a partnership with Jerde Partnership International. Adelson’s Macau unit, Sands China, is now the world’s second largest gaming company by market capitalization, behind its Las Vegas parent.
Asian American’s Macau lawyer Jorge Menezes said the Nevada and Macau lawsuits have different causes of actions.
“Suing in Nevada does not hinder the Macau lawsuit’s progress,” he told Reuters.
Another case plaguing Sands is a long-running legal tussle with former employee Steven Jacobs, who is suing for wrongful termination of his contract.
Investigations by the U.S. Department of Justice and the Securities and Exchange Commission are examining whether Sands has violated federal anti-corruption laws.
Despite the ongoing legal cases, Sands is building a new casino resort in Macau called the Parisian, a replica of the Eiffel Tower expected to open in the next two years.
- Farah Master, Reuters
