US casino powerhouse Las Vegas Sands is facing a $12 billion lawsuit filed in Macau by a former partner. The case casts light on how officials in the world’s biggest gambling hub awarded casino licenses two decades ago, Reuters notes.
Las Vegas Sands partnered Asian American Entertainment Corporation, a company headed by Taiwanese businessman Marshall Hao, in 2001 to jointly pursue a license to operate casino establishments in Macau.
The two companies submitted a bid for a gaming concession that year. However, during the process, Sands dropped Asian American as its partner and instead teamed up with Hong Kong casino group Galaxy Entertainment, according to the lawsuit.
Sands and Galaxy eventually won a license in the former Portuguese colony. Sands now operates The Venetian Macao, Sands Macao, The Londoner Macao, The Plaza Macao & Four Seasons Hotel Macao, and The Parisian Macao in the world’s gambling capital.
In its lawsuit against its former partner, Asian American seeks damages of around 70% of Sands’ profits generated from its Macau properties from 2004 to 2022. Reuters estimates the figure to be around $12 billion.
A trial is set to kick off in a Macau court on June 16. Asian American alleges that Sands breached their 2001 contract for a casino license in the city, which is the only place in China where casino gambling is permitted.
Prolonged Legal Battle
The looming trial is just the latest legal challenge for Sands from its former partner. The US casino giant has been battling Asian American’s claims since 2007 when the case was first launched in Sands’ homeland.
The US case was dismissed for statute of limitations and different procedural reasons and a new one was lodged in Macau in 2012.
Asian American’s boss, Mr. Hao, told Reuters that after terminating its joint venture with his company, Sands went on to submit a near replica of its previous bid with its new partner Galaxy. Mr. Hao went on that his company has been “winning all major legal battles in the Macau lawsuit since we filed it in 2012” and that they are confident in their success.
Sands has tried to avoid trial by launching legal action in Nevada and Macau. The company said back in 2019 that it “has consistently maintained that this case has no merit” and that they are confident “that ultimately the Macao judicial process will reach the same conclusion.”
In its most recent annual financial report, Sands said that its management was at that point unable to “determine the probability of the outcome of this matter or the range of reasonably possible loss, if any.”
Sands’ Macau license expires next year and the company will have to re-bid for it via a public tender, details of which are yet to be released by Macau officials.
Source: Las Vegas Sands faces $12 billion claim in Macau court, Reuters, June 9, 2021